Delaware | 06-0842255 | |
(State or other jurisdiction of incorporation or organization) | (I.R.S. Employer Identification No.) | |
1775 Sherman Street, Suite 1950, Denver, Colorado | 80203 | |
(Address of principal executive offices) | (Zip Code) |
Title of each class | Name of each exchange on which registered | |
Common stock, par value $0.01 per share | NASDAQ Capital Market |
Large accelerated filer o | Accelerated filer o | Non-accelerated filer o | Smaller reporting company þ | |||
(Do not check if a smaller reporting company) |
ITEM | PAGE | |
PART I | ||
PART II | ||
PART III | ||
PART IV | ||
Oil (Mbbls) | ||
United States Reserves: | ||
Proved developed producing ("PDP") | 792 | |
Proved developed not producing ("PDNP") | 103 | |
Proved undeveloped ("PUD") | — | |
Total reserves | 895 | |
PDP% | 88 | % |
PDNP% | 12 | % |
PUD% | — | % |
June 30, | |||||
2016 | 2015 | ||||
United States: | |||||
Volumes (Mbbls) | 60 | 79 | |||
Average realized prices ($/bbl) | $33.17 | $56.44 | |||
Lease operating expenses ($/bbl) | $42.67 | $64.42 |
Productive Wells | ||
United States: | ||
Gross oil wells (1) | 24.0 | |
Net oil wells (2) | 21.0 |
June 30, | |||||||||||
2016 | 2015 | ||||||||||
Productive (2) | Dry (3) | Productive (2) | Dry (3) | ||||||||
United States: | |||||||||||
Development wells, net (1) | — | — | — | — | |||||||
Exploratory wells, net (1) | — | — | — | — | |||||||
Total net wells | — | — | — | — |
Developed (1) | Undeveloped (4) | Total | |||||||||||||||
Gross (2) | Net (3) | Gross (2) | Net (3) | Gross (2) | Net (3) | ||||||||||||
United States (Poplar) | 22,913 | 22,669 | — | — | 22,913 | 22,669 | |||||||||||
United Kingdom | 80 | 28 | 293,749 | 138,420 | 293,829 | 138,448 | |||||||||||
Australia (NT/P82) | — | — | 1,566,647 | 1,566,647 | 1,566,647 | 1,566,647 | |||||||||||
Total | 22,993 | 22,697 | 1,860,396 | 1,705,067 | 1,883,389 | 1,727,764 |
License | Geologic basin | Expiration date | Operator | Ownership interest | Gross acres (1) | Net acres (2) | ||||||||
Central Weald licenses (3): | ||||||||||||||
PEDL 231 | Weald | 6/30/2016 | Celtique (4) | 50% | 98,800 | 49,400 | ||||||||
PEDL 234 | Weald | 6/30/2017 | Celtique (4) | 50% | 74,100 | 37,050 | ||||||||
PEDL 243 | Weald | 6/30/2016 | Celtique (4) | 50% | 74,100 | 37,050 | ||||||||
Subtotal | 247,000 | 123,500 | ||||||||||||
Licenses containing Horse Hill-1: | ||||||||||||||
PEDL 137 | Weald | 6/30/2018 | HHDL | 35% | 24,525 | 8,584 | ||||||||
PEDL 246 | Weald | 6/30/2017 | HHDL | 35% | 10,769 | 3,769 | ||||||||
Subtotal | 35,294 | 12,353 | ||||||||||||
Other licenses on periphery of Weald Basin (5): | ||||||||||||||
P1916 | Wessex | 1/31/2017 | UKOG | 22.5% | 11,535 | 2,595 | ||||||||
Total | 293,829 | 138,448 |
License | Geologic basin | Expiration date | Operator | Ownership interest | Gross acres (1) | Net acres (2) | ||||||||
NT/P82 | Bonaparte | 11/12/2017 | Magellan | 100% | 1,566,647 | 1,566,647 | ||||||||
Total | 1,566,647 | 1,566,647 |
• | require the acquisition of various permits before drilling commences; |
• | restrict the types, quantities, and concentration of various substances that can be released into the environment in connection with oil and natural gas drilling and production and saltwater disposal activities; |
• | limit or prohibit drilling activities on certain lands lying within wilderness, wetlands, and other protected areas, including areas containing certain wildlife or threatened and endangered plant and animal species; and |
• | require remedial measures to mitigate pollution from former and ongoing operations, such as requirements to close pits |
• | unexpected drilling conditions; |
• | title problems; |
• | disputes with owners or holders of surface interests on or near areas where we intend to drill; |
• | pressure or geologic irregularities in formations; |
• | engineering and construction delays; |
• | equipment failures or accidents; |
• | adverse weather conditions; |
• | compliance with environmental and other governmental requirements; and |
• | shortages or delays in the availability of or increases in the cost of drilling rigs and crews, equipment, pipe, water, and other supplies. |
• | the possibility that such third parties may not be available to us as and when needed; and |
• | the risk that we may not be able to properly control the timing and quality of work conducted with respect to our projects. |
• | worldwide and domestic supplies of oil and gas, and the productive capacity of the oil and gas industry as a whole; |
• | changes in the supply and the level of consumer demand for such fuels; |
• | overall global and domestic economic conditions; |
• | political conditions in oil, natural gas, and other fuel-producing and fuel-consuming areas; |
• | the extent of UK and Australian domestic oil and gas production and the consumption and importation of such fuels and substitute fuels in UK, Australian, and other relevant markets; |
• | the availability and capacity of gathering, transportation, processing, and/or refining facilities in regional or localized areas that may affect the realized price for crude oil or natural gas; |
• | the price and level of foreign imports of crude oil, refined petroleum products, and liquefied natural gas; |
• | weather conditions, including effects of weather conditions on prices and supplies in worldwide energy markets; |
• | technological advances affecting energy consumption and conservation; |
• | the ability of the members of the Organization of Petroleum Exporting Countries and other exporting countries to agree to and maintain crude oil prices and production controls; |
• | the competitive position of each such fuel as a source of energy as compared to other energy sources; |
• | strengthening and weakening of the US dollar relative to other currencies; and |
• | the effect of governmental regulations and taxes on the production, transportation, and sale of oil, natural gas, and other fuels. |
• | actual prices we receive for oil and natural gas; |
• | actual costs of development and production expenditures; |
• | the amount and timing of actual production; |
• | supply of and demand for oil and natural gas; and |
• | changes in governmental regulations or taxation, including severance and excise taxes. |
• | injury or loss of life; |
• | severe damage to, or destruction of, property, natural resources, and equipment; |
• | pollution or other environmental damage; |
• | clean-up responsibilities; |
• | regulatory investigations and penalties; and |
• | suspension of operations. |
• | determination of the nature and timing of flow test, drilling and operational activities; |
• | determination of the timing and amount of capital expenditures; |
• | expertise and financial resources; |
• | approval of other participants in drilling wells; and |
• | selection of suitable technology. |
• | eliminating the current deduction for intangible drilling and development costs; |
• | eliminating the deduction for certain US production activities for oil and natural gas production; |
• | repealing the percentage depletion allowance for oil and natural gas properties; and |
• | extending the amortization period for certain geological and geophysical expenditures. |
• | changes in crude oil or natural gas commodity prices; |
• | our quarterly or annual operating results; |
• | investment recommendations by securities analysts following our business or our industry; |
• | additions or departures of key personnel; |
• | changes in the business, earnings estimates, or market perceptions of comparable companies; |
• | changes in industry, general market, or regional or global economic conditions; and |
• | announcements of legislative or regulatory changes affecting our business or our industry. |
• | authorize us to issue preferred stock that can be created and issued by the board of directors without prior stockholder approval, with rights senior to those of the common stock; |
• | classify our board of directors so that only some of our directors are elected each year; |
• | prohibit stockholders from calling special meetings of stockholders; and |
• | establish advance notice requirements for submitting nominations for election to the board of directors and for proposing matters that can be acted upon by stockholders at a meeting. |
Quarter ended | High | Low | ||
June 30, 2016 | $1.41 | $0.80 | ||
March 31, 2016 | $1.49 | $0.20 | ||
December 31, 2015 | $0.83 | $0.48 | ||
September 30, 2015 | $3.60 | $0.53 | ||
June 30, 2015 | $5.44 | $2.00 | ||
March 31, 2015 | $7.44 | $4.08 | ||
December 31, 2014 | $17.36 | $6.24 | ||
September 30, 2014 | $18.64 | $13.36 |
June 30, 2016 | June 30, 2015 | ||||||
(in thousands) | |||||||
Outstanding borrowings: | |||||||
Notes payable | 783 | — | |||||
Total | $ | 783 | $ | — |
Total | Less than 1 year | 1-3 years | 3-5 years | More than 5 years | |||||||||||||||
(In thousands) | |||||||||||||||||||
Contractual obligations payable from continuing operations: | |||||||||||||||||||
Retention benefits | $ | 425 | $ | 425 | $ | — | $ | — | $ | — | |||||||||
Operating leases | 249 | 175 | 74 | — | — | ||||||||||||||
Notes payable | 158 | 158 | — | — | — | ||||||||||||||
Contingent consideration payable (1) | — | — | — | — | — | ||||||||||||||
Total contractual obligations payable from continuing operations | 832 | 758 | 74 | — | — | ||||||||||||||
Contractual obligations settled upon closing of agreements related to discontinued operations subsequent to June 30, 2016: | |||||||||||||||||||
Note payable (2) | 625 | 625 | — | — | — | ||||||||||||||
Litigation settlement held for sale (3) | 670 | 670 | — | — | — | ||||||||||||||
Asset retirement obligations held for sale (4) | 2,818 | — | — | 1,588 | 1,230 | ||||||||||||||
Term loan held for sale (4) (5) | 6,039 | 1,613 | 3,019 | 1,407 | — | ||||||||||||||
Total contractual obligations settled upon closing of agreements related to discontinued operations subsequent to June 30, 2016 | 10,152 | 2,908 | 3,019 | 2,995 | 1,230 | ||||||||||||||
Total contractual obligations as of June 30, 2016 | $ | 10,984 | $ | 3,666 | $ | 3,093 | $ | 2,995 | $ | 1,230 |
June 30, | |||||||
2016 | 2015 | ||||||
(In thousands) | |||||||
Cash (used in) provided by: | |||||||
Operating activities | $ | (2,156 | ) | $ | (6,593 | ) | |
Investing activities | 5,108 | 18 | |||||
Financing activities | 385 | 3,204 | |||||
Discontinued operations | (2,310 | ) | (11,319 | ) | |||
Effect of exchange rate changes on cash and cash equivalents | (116 | ) | (661 | ) | |||
Net increase (decrease) in cash and cash equivalents | $ | 911 | $ | (15,351 | ) |
June 30, | ||||||||||||||
2016 | 2015 | Difference | Percent change | |||||||||||
Selected operating expenses (USD): | (in thousands) | |||||||||||||
Depreciation | $ | 54 | $ | 148 | $ | (94 | ) | (64 | )% | |||||
Exploration | 71 | 239 | (168 | ) | (70 | )% | ||||||||
General and administrative | 5,214 | 7,946 | (2,732 | ) | (34 | )% |
June 30, | ||||||||||||||
2016 | 2015 | Difference | Percent change | |||||||||||
(In thousands) | ||||||||||||||
General and administrative (excluding stock-based compensation and foreign transaction loss) | $ | 4,279 | $ | 6,420 | $ | (2,141 | ) | (33 | )% | |||||
Stock-based compensation | 701 | 891 | (190 | ) | (21 | )% | ||||||||
Foreign transaction loss | 234 | 635 | (401 | ) | (63 | )% | ||||||||
Total | $ | 5,214 | $ | 7,946 | $ | (2,732 | ) | (34 | )% |
June 30, | ||||||||||||||
2016 | 2015 | Difference | Percent change | |||||||||||
Poplar: | ||||||||||||||
Oil revenue (in thousands) | $ | 1,990 | $ | 4,459 | $ | (2,469 | ) | (55 | )% | |||||
Oil sales volume (Mbbls) | 60 | 79 | (19 | ) | (24 | )% | ||||||||
Oil sales volume (bopd) | 164 | 217 | (53 | ) | (24 | )% | ||||||||
Average realized oil price ($/bbl) | $33.17 | $56.44 | $ | (23.27 | ) | (41 | )% |
June 30, | ||||||||||||||
2016 | 2015 | Difference | Percent change | |||||||||||
(In thousands) | ||||||||||||||
Selected operating expenses: | ||||||||||||||
Lease operating | $ | 2,560 | $ | 5,089 | $ | (2,529 | ) | (50 | )% | |||||
Depletion, depreciation, amortization, and accretion | $ | 651 | $ | 1,001 | $ | (350 | ) | (35 | )% | |||||
Impairment | $ | 11,280 | $ | 17,353 | $ | (6,073 | ) | (35 | )% | |||||
Exploration | $ | 240 | $ | 1,324 | $ | (1,084 | ) | (82 | )% | |||||
General and administrative | $ | 631 | $ | 200 | $ | 431 | 216 | % | ||||||
Selected operating expenses ($/bbl): | ||||||||||||||
Lease operating | 43 | 64 | (21 | ) | (33 | )% | ||||||||
Depletion, depreciation, amortization, and accretion | 11 | 13 | (2 | ) | (15 | )% | ||||||||
Impairment | 188 | 220 | (32 | ) | (15 | )% | ||||||||
Exploration | 4 | 17 | (13 | ) | (76 | )% | ||||||||
General and administrative | 11 | 3 | 8 | 267 | % |
June 30, | ||||||||||||||
2016 | 2015 | Difference | Percent change | |||||||||||
(In thousands) | ||||||||||||||
Depreciation and amortization | $ | 31 | $ | 51 | $ | (20 | ) | (39 | )% | |||||
Depletion | 449 | 779 | (330 | ) | (42 | )% | ||||||||
ARO accretion | 171 | 171 | — | — | % | |||||||||
Total | $ | 651 | $ | 1,001 | $ | (350 | ) | (35 | )% |
June 30, | |||||||
2016 | 2015 | ||||||
ASSETS | |||||||
CURRENT ASSETS: | |||||||
Cash and cash equivalents | $ | 1,680 | $ | 769 | |||
Securities available-for-sale | 601 | 4,230 | |||||
Accounts receivable | 16 | 46 | |||||
Prepaid and other assets | 2,087 | 2,023 | |||||
Current assets held for sale (Note 4) | 26,042 | 1,514 | |||||
Total current assets | 30,426 | 8,582 | |||||
PROPERTY AND EQUIPMENT, NET (SUCCESSFUL EFFORTS METHOD): | |||||||
Unproved oil and gas properties | 32 | 38 | |||||
Wells in progress | 337 | 350 | |||||
Land, buildings, and equipment (net of accumulated depreciation of $517 and $463 as of June 30, 2016, and 2015, respectively) | 86 | 139 | |||||
Property and equipment held for sale (Note 4) | — | 36,546 | |||||
Net property and equipment | 455 | 37,073 | |||||
OTHER NON-CURRENT ASSETS: | |||||||
Goodwill, net | 500 | 500 | |||||
Other long-term assets | 169 | 169 | |||||
Long-term assets held for sale (Note 4) | — | 376 | |||||
Total other non-current assets | 669 | 1,045 | |||||
Total assets | $ | 31,550 | $ | 46,700 | |||
LIABILITIES AND STOCKHOLDERS' (DEFICIT) EQUITY | |||||||
CURRENT LIABILITIES: | |||||||
Accounts payable | $ | 791 | $ | 298 | |||
Accrued and other liabilities | 2,826 | 2,119 | |||||
Notes payable | 783 | — | |||||
Current liabilities held for sale (Note 4) | 10,638 | 2,237 | |||||
Total current liabilities | 15,038 | 4,654 | |||||
LONG-TERM LIABILITIES: | |||||||
Long-term liabilities held for sale (Note 4) | — | 8,251 | |||||
Total long-term liabilities | — | 8,251 |
COMMITMENTS AND CONTINGENCIES (Note 16) | |||||||
PREFERRED STOCK (Note 12): | |||||||
Series A convertible preferred stock (par value $0.01 per share): Authorized 28,000,000 shares; issued and outstanding 22,683,428 and 21,162,697 shares as of June 30, 2016, and 2015, respectively; liquidation preference of $29,093 and $28,435, respectively | 23,501 | 25,850 | |||||
Total preferred stock | 23,501 | 25,850 | |||||
STOCKHOLDERS' (DEFICIT) EQUITY: | |||||||
Common stock (par value $0.01 per share): Authorized 300,000,000 shares, issued 6,972,023 and 6,917,027 as of June 30, 2016, and 2015, respectively | 70 | 69 | |||||
Treasury stock (at cost): 1,209,389 shares as of June 30, 2016, and 2015 | (9,806 | ) | (9,806 | ) | |||
Capital in excess of par value | 94,069 | 93,386 | |||||
Accumulated deficit | (96,234 | ) | (81,006 | ) | |||
Accumulated other comprehensive income | 4,912 | 5,302 | |||||
Total stockholders' (deficit) equity | (6,989 | ) | 7,945 | ||||
Total liabilities, preferred stock and stockholders' (deficit) equity | $ | 31,550 | $ | 46,700 |
For the years ended June 30, | |||||||
2016 | 2015 | ||||||
OPERATING EXPENSES: | |||||||
Depreciation | $ | 54 | $ | 148 | |||
Exploration | 71 | 239 | |||||
General and administrative | 5,214 | 7,946 | |||||
Loss on sale of assets | — | 316 | |||||
Total operating expenses | 5,339 | 8,649 | |||||
Loss from operations | (5,339 | ) | (8,649 | ) | |||
OTHER INCOME (EXPENSE): | |||||||
Net interest expense | (4 | ) | — | ||||
Loss on investment in securities | (587 | ) | (15,087 | ) | |||
Gain on sale of bonus rights (Note 5) | 2,514 | — | |||||
Fair value revision of contingent consideration payable | — | 1,888 | |||||
Other income | 88 | 252 | |||||
Total other income (expense) | 2,011 | (12,947 | ) | ||||
Loss from continuing operations, before tax | (3,328 | ) | (21,596 | ) | |||
Income tax expense | — | — | |||||
Loss from continuing operations, net of tax | (3,328 | ) | (21,596 | ) | |||
DISCONTINUED OPERATIONS (Note 4): | |||||||
Loss from discontinued operations, net of tax | (14,249 | ) | (21,404 | ) | |||
Net loss from discontinued operations | (14,249 | ) | (21,404 | ) | |||
Net loss | (17,577 | ) | (43,000 | ) | |||
Preferred stock dividends | (1,858 | ) | (1,740 | ) | |||
Adjustment of preferred stock to redemption value (Note 12) | 4,207 | — | |||||
Net loss attributable to common stockholders | $ | (15,228 | ) | $ | (44,740 | ) | |
Loss per common share (Note 14): | |||||||
Weighted average number of basic shares outstanding | 5,746,307 | 5,710,288 | |||||
Weighted average number of diluted shares outstanding | 5,746,307 | 5,710,288 | |||||
Basic and diluted loss per common share: | |||||||
Net loss from continuing operations, including preferred stock dividends and adjustment to redemption value of preferred stock | $(0.17) | $(4.09) | |||||
Net loss from discontinued operations | $(2.48) | $(3.75) | |||||
Net loss attributable to common stockholders | $(2.65) | $(7.83) |
For the years ended June 30, | |||||||
2016 | 2015 | ||||||
Net loss | $ | (17,577 | ) | $ | (43,000 | ) | |
Other comprehensive (loss) income, net of tax: | |||||||
Foreign currency translation loss | (125 | ) | (2,141 | ) | |||
Reclassification of foreign currency translation loss on intercompany account balances to earnings upon reversal of permanent investment in foreign subsidiaries | — | 659 | |||||
Reclassification of impairment loss on securities available-for-sale to earnings due to determination as other than temporary | — | 15,087 | |||||
Unrealized holding losses on securities available-for-sale | (265 | ) | (6,294 | ) | |||
Other comprehensive (loss) income, net of tax | (390 | ) | 7,311 | ||||
Comprehensive loss | $ | (17,967 | ) | $ | (35,689 | ) |
Common Stock | Capital in Excess of Par Value | Treasury Stock | Accumulated Deficit | Accumulated Other Comprehensive Income | Total Stockholders' (Deficit) Equity | |||||||||||||||||||||
Shares | Amount | |||||||||||||||||||||||||
Fiscal year ended June 30, 2014 | 6,875,605 | $ | 69 | $ | 93,467 | $ | (9,344 | ) | $ | (36,266 | ) | $ | (2,009 | ) | $ | 45,917 | ||||||||||
Net loss | — | — | — | — | (43,000 | ) | — | (43,000 | ) | |||||||||||||||||
Other comprehensive income, net of tax | — | — | — | — | — | 7,311 | 7,311 | |||||||||||||||||||
Stock and stock-based compensation | 30,791 | — | 1,606 | — | — | — | 1,606 | |||||||||||||||||||
Executive and employee forfeiture of options upon resignation | — | — | (648 | ) | — | — | — | (648 | ) | |||||||||||||||||
Executive forfeiture of restricted stock upon resignation | (17,500 | ) | — | (67 | ) | — | — | — | (67 | ) | ||||||||||||||||
Purchase of stock and options from former executive | — | — | (983 | ) | (462 | ) | — | — | (1,445 | ) | ||||||||||||||||
Net shares repurchased for employee tax costs upon vesting of restricted stock | (5,981 | ) | — | (104 | ) | — | — | — | (104 | ) | ||||||||||||||||
Stock options exercised, net of shares withheld to satisfy employee tax obligations | 34,112 | — | 115 | — | — | — | 115 | |||||||||||||||||||
Preferred stock dividend | — | — | — | — | (1,740 | ) | — | (1,740 | ) | |||||||||||||||||
Fiscal year ended June 30, 2015 | 6,917,027 | 69 | 93,386 | (9,806 | ) | (81,006 | ) | 5,302 | 7,945 | |||||||||||||||||
Net loss | — | — | — | — | (17,577 | ) | — | (17,577 | ) | |||||||||||||||||
Other comprehensive loss, net of tax | — | — | — | — | — | (390 | ) | (390 | ) | |||||||||||||||||
Stock and stock-based compensation | 62,500 | 1 | 700 | — | — | — | 701 | |||||||||||||||||||
Net shares repurchased for employee tax costs upon vesting of restricted stock | (5,220 | ) | — | (11 | ) | — | — | — | (11 | ) | ||||||||||||||||
Payment of cash in lieu of issuance of fractional shares in one share for eight shares reverse stock split | (2,284 | ) | — | (6 | ) | — | — | — | (6 | ) | ||||||||||||||||
Preferred stock dividend | — | — | — | — | (1,858 | ) | — | (1,858 | ) | |||||||||||||||||
Adjustment of preferred stock to redemption value (Note 12) | — | — | — | — | 4,207 | — | 4,207 | |||||||||||||||||||
Fiscal year ended June 30, 2016 | 6,972,023 | $ | 70 | $ | 94,069 | $ | (9,806 | ) | $ | (96,234 | ) | $ | 4,912 | $ | (6,989 | ) |
For the years ended June 30, | |||||||
2016 | 2015 | ||||||
OPERATING ACTIVITIES: | |||||||
Loss from continuing operations, net of tax | $ | (3,328 | ) | $ | (21,596 | ) | |
Adjustments to reconcile net loss to net cash used in operating activities: | |||||||
Foreign transaction loss | 286 | 635 | |||||
Depreciation | 54 | 148 | |||||
Fair value revision of contingent consideration payable | — | (1,888 | ) | ||||
Accretion expense of contingent consideration payable | — | 36 | |||||
Loss on investment in securities | 587 | 15,087 | |||||
(Gain) loss on disposal of assets | (2,514 | ) | 316 | ||||
Exploration costs previously capitalized | — | 20 | |||||
Stock compensation expense | 701 | 892 | |||||
Net changes in operating assets and liabilities: | |||||||
Accounts receivable | 28 | (5 | ) | ||||
Inventories | — | (39 | ) | ||||
Prepayments and other current assets | 286 | (63 | ) | ||||
Accounts payable and accrued liabilities | 1,744 | (136 | ) | ||||
Net cash used in operating activities of continuing operations | (2,156 | ) | (6,593 | ) | |||
INVESTING ACTIVITIES: | |||||||
Additions to property and equipment | (1 | ) | (3 | ) | |||
Proceeds from sale of bonus rights | 2,514 | — | |||||
Proceeds from sale of securities | 2,595 | 21 | |||||
Net cash provided by investing activities of continuing operations | 5,108 | 18 | |||||
FINANCING ACTIVITIES: | |||||||
Proceeds from issuance of common stock, net | — | 115 | |||||
Purchase of common stock | (11 | ) | (566 | ) | |||
Purchase of stock options | — | (983 | ) | ||||
Payment of cash in lieu of fractional shares in one share for eight shares reverse stock split | (6 | ) | — | ||||
Payment of preferred stock dividend | — | (859 | ) | ||||
Deferred financing costs, net | (28 | ) | (150 | ) | |||
Short-term debt issuances | 625 | — | |||||
Payments on notes payable | (195 | ) | — | ||||
Long-term debt issuances | — | 5,500 | |||||
Capital contributions by non-controlling interest included in discontinued operations | — | 147 | |||||
Net cash provided by financing activities | 385 | 3,204 | |||||
CASH FLOWS FROM DISCONTINUED OPERATIONS: | |||||||
Net cash used in operating activities of discontinued operations | (2,130 | ) | (1,972 | ) | |||
Net cash used in investing activities of discontinued operations | (180 | ) | (9,347 | ) | |||
Net cash used in operating and investing activities of discontinued operations | (2,310 | ) | (11,319 | ) | |||
Effect of exchange rate changes on cash and cash equivalents | (116 | ) | (661 | ) | |||
Net increase (decrease) in cash and cash equivalents | 911 | (15,351 | ) | ||||
Cash and cash equivalents at beginning of period | 769 | 16,120 | |||||
CASH AND CASH EQUIVALENTS AT END OF PERIOD | $ | 1,680 | $ | 769 | |||
Supplemental disclosure of cash flow information: | |||||||
Cash paid for interest | $ | 7 | $ | 18 | |||
Cash paid for interest of discontinued operations | $ | 269 | $ | 84 | |||
Cash received for interest | $ | (3 | ) | $ | (20 | ) | |
Cash paid for income taxes | $ | — | $ | — | |||
Supplemental schedule of non-cash investing and financing activities: | |||||||
Unrealized holding loss and foreign currency translation loss on securities available-for-sale | $ | (282 | ) | $ | (7,684 | ) | |
Adjustment of preferred stock to redemption value | $ | (4,206 | ) | $ | — | ||
Preferred stock dividends paid in kind | $ | 1,858 | $ | 1,311 | |||
Increase in both accrued and other liabilities and prepaid and other assets related to Sopak | $ | 107 | $ | 105 | |||
Purchase of insurance policies financed with notes payable | $ | 353 | $ | — | |||
Non-cash activities of discontinued operations: | |||||||
Change in accounts payable and accrued liabilities related to property and equipment of discontinued operations | $ | 17 | $ | (1,017 | ) | ||
Property contributed for capital and deferred capital contribution of non-controlling interest included in discontinued operations | $ | — | $ | 200 | |||
Accrued capital contributions of non-controlling interest included in discontinued operations | $ | — | $ | 168 |
June 30, | ||||||||||||||||||||||||
2016 | 2015 | |||||||||||||||||||||||
CO2 Business | Weald Basin | Total | CO2 Business | Weald Basin | Total | |||||||||||||||||||
(in thousands) | ||||||||||||||||||||||||
Revenue | $ | 1,990 | $ | — | $ | 1,990 | $ | 4,459 | $ | — | $ | 4,459 | ||||||||||||
Operating, exploration and general and administrative expenses | 3,070 | 361 | 3,431 | 6,708 | 370 | 7,078 | ||||||||||||||||||
Depletion, depreciation, amortization and accretion | 651 | — | 651 | 1,001 | — | 1,001 | ||||||||||||||||||
Exploration | — | — | — | — | — | — | ||||||||||||||||||
Impairment expense | 11,280 | — | 11,280 | 18,027 | — | 18,027 | ||||||||||||||||||
General and administrative | — | — | — | — | — | — | ||||||||||||||||||
Interest expense and other disposal costs | 926 | — | 926 | 168 | — | 168 | ||||||||||||||||||
Total expenses | $ | 15,927 | $ | 361 | $ | 16,288 | 25,904 | 370 | 26,274 | |||||||||||||||
Non-controlling interest | 49 | — | 49 | 411 | — | 411 | ||||||||||||||||||
Loss from discontinued operations before tax | $ | (13,888 | ) | $ | (361 | ) | $ | (14,249 | ) | $ | (21,034 | ) | $ | (370 | ) | $ | (21,404 | ) |
June 30, | ||||||||||||||||||||||||
2016 | 2015 | |||||||||||||||||||||||
CO2 Business | Weald Basin | Total | CO2 Business | Weald Basin | Total | |||||||||||||||||||
(in thousands) | ||||||||||||||||||||||||
Carrying amounts of major classes of assets included as part of assets held for sale: | ||||||||||||||||||||||||
Cash | $ | 141 | $ | — | $ | 141 | $ | 282 | $ | — | $ | 282 | ||||||||||||
Accounts receivable | 249 | — | 249 | 504 | — | 504 | ||||||||||||||||||
Inventories | 232 | 301 | 533 | 297 | 354 | 651 | ||||||||||||||||||
Other classes of current assets that are not major | 34 | — | 34 | 77 | — | 77 | ||||||||||||||||||
Property and equipment, net | 23,941 | 812 | 24,753 | 35,593 | 953 | 36,546 | ||||||||||||||||||
Other classes of assets that are not major | 332 | — | 332 | 376 | — | 376 | ||||||||||||||||||
Total assets of the disposal group classified as held for sale in the balance sheet | $ | 24,929 | $ | 1,113 | $ | 26,042 | $ | 37,129 | $ | 1,307 | $ | 38,436 | ||||||||||||
Carrying amounts of major classes of liabilities included as part of liabilities held for sale: | ||||||||||||||||||||||||
Accounts payable | $ | 1,594 | $ | 670 | $ | 2,264 | $ | 1,752 | $ | 485 | $ | 2,237 | ||||||||||||
Note payable | 5,500 | — | 5,500 | 5,500 | — | 5,500 | ||||||||||||||||||
Asset retirement obligations | 2,818 | — | 2,818 | 2,647 | — | 2,647 | ||||||||||||||||||
Other classes of liabilities that are not major | 56 | — | 56 | 104 | — | 104 | ||||||||||||||||||
Total liabilities of the disposal group classified as held for sale in the balance sheet | $ | 9,968 | $ | 670 | $ | 10,638 | $ | 10,003 | $ | 485 | $ | 10,488 |
June 30, | |||||||
2016 | 2015 | ||||||
(In thousands) | |||||||
Fiscal year opening balance | $ | 2,647 | $ | 2,476 | |||
Accretion expense | 171 | 171 | |||||
Fiscal year closing balance | 2,818 | 2,647 | |||||
Less current asset retirement obligations | — | — | |||||
Long-term asset retirement obligations | $ | 2,818 | $ | 2,647 |
June 30, 2016 | |||||||||||||||
Amortized cost | Gross unrealized gains | Gross unrealized losses | Fair value | ||||||||||||
(In thousands) | |||||||||||||||
Equity securities | $ | 885 | $ | — | $ | (284 | ) | $ | 601 | ||||||
June 30, 2015 | |||||||||||||||
Amortized cost | Gross unrealized gains | Gross unrealized losses | Fair value | ||||||||||||
(In thousands) | |||||||||||||||
Equity securities | $ | 4,230 | $ | — | $ | — | $ | 4,230 |
Total | ||||
(In thousands) | ||||
Payable in fiscal year: | ||||
2017 | $ | 783 | ||
Total | $ | 783 |
June 30, | |||||||
2016 | 2015 | ||||||
(In thousands) | |||||||
Fiscal year opening balance | $ | — | $ | 397 | |||
Sale of assets (1) | — | (346 | ) | ||||
Effect of exchange rate changes | — | (51 | ) | ||||
Fiscal year closing balance | — | — | |||||
Less current asset retirement obligations | — | — | |||||
Long-term asset retirement obligations | $ | — | $ | — |
• | Level 1: Quoted prices in active markets for identical assets. |
• | Level 2: Significant other observable inputs – inputs to the valuation methodology include quoted prices for similar assets and liabilities in active markets and inputs that are observable for the asset or liability, either directly or indirectly, for substantially the full term of the financial instrument. |
• | Level 3: Significant inputs to the valuation model are unobservable inputs. |
June 30, 2016 | |||||||||||||||
Level 1 | Level 2 | Level 3 | Total | ||||||||||||
(In thousands) | |||||||||||||||
Assets: | |||||||||||||||
Securities available-for-sale | $ | 601 | $ | — | $ | — | $ | 601 | |||||||
Liabilities: | |||||||||||||||
Contingent consideration payable | $ | — | $ | — | $ | — | $ | — | |||||||
June 30, 2015 | |||||||||||||||
Level 1 | Level 2 | Level 3 | Total | ||||||||||||
(In thousands) | |||||||||||||||
Assets: | |||||||||||||||
Securities available-for-sale | $ | 4,230 | $ | — | $ | — | $ | 4,230 | |||||||
Liabilities: | |||||||||||||||
Contingent consideration payable | $ | — | $ | — | $ | — | $ | — |
June 30, | ||||||||
Description | Valuation technique | Significant unobservable inputs | 2016 | 2015 | ||||
Contingent consideration payable | Discounted cash flow model | Discount rate | N/A | N/A | ||||
First production payout | N/A | N/A | ||||||
Second production payout | N/A | N/A |
June 30, | |||||||
2016 | 2015 | ||||||
(In thousands) | |||||||
Fiscal year beginning balance | $ | — | $ | 1,852 | |||
Accretion expense | — | 36 | |||||
Revision to estimate | — | (1,888 | ) | ||||
Fiscal year closing balance | $ | — | $ | — |
June 30, | |||||||
2016 | 2015 | ||||||
(In thousands) | |||||||
United States | $ | (4,454 | ) | $ | (4,371 | ) | |
Australia | 1,497 | (16,146 | ) | ||||
United Kingdom | (371 | ) | (1,079 | ) | |||
Net loss from continuing operations | $ | (3,328 | ) | $ | (21,596 | ) |
June 30, | |||||||
2016 | 2015 | ||||||
(In thousands) | |||||||
Tax provision computed per federal statutory rate | $ | (1,131 | ) | $ | (7,343 | ) | |
State taxes, net of federal benefit | (91 | ) | (153 | ) | |||
Foreign rate differential | (8 | ) | 908 | ||||
Accounting Principles Board 23 adjustment | — | 9,632 | |||||
Change in valuation allowance | (668 | ) | (5,254 | ) | |||
Foreign tax credit adjustment | — | (310 | ) | ||||
Net operating loss and capital loss adjustment | 179 | 1,493 | |||||
Impact of rate change | 47 | 159 | |||||
Foreign currency translation differential | 838 | 1,255 | |||||
Stock-based compensation forfeitures | 621 | 545 | |||||
Contingent consideration payable write-off | — | (630 | ) | ||||
Other items | 213 | (302 | ) | ||||
Consolidated income tax expense (benefit) | $ | — | $ | — |
June 30, | |||||||
2016 | 2015 | ||||||
(In thousands) | |||||||
Consolidated current income tax provision | — | — | |||||
Consolidated deferred income tax provision | — | — | |||||
Consolidated income tax provision | $ | — | $ | — | |||
The consolidated income tax provision is summarized as follows: | |||||||
Continuing operations | $ | — | $ | — | |||
Discontinued operations | $ | — | $ | — | |||
Effective tax rate for continuing operations | — | % | — | % |
June 30, | |||||||
2016 | 2015 | ||||||
(In thousands) | |||||||
Deferred tax liabilities: | |||||||
Land, buildings and equipment | $ | — | $ | — | |||
Foreign investments | (10,851 | ) | (7,451 | ) | |||
Other items | (72 | ) | (128 | ) | |||
Total deferred tax liabilities | (10,923 | ) | (7,579 | ) | |||
Deferred tax assets: | |||||||
Land, buildings and equipment | (21 | ) | (5 | ) | |||
Asset retirement obligations | — | — | |||||
Net operating losses, capital losses, and foreign tax credit carry forwards | 21,408 | 18,521 | |||||
United Kingdom exploration costs and net operating losses | 3,109 | 3,639 | |||||
Investments | 111 | 100 | |||||
Stock option compensation | 1,810 | 2,184 | |||||
Australian capitalized legal costs | 112 | 116 | |||||
Other items | 286 | 141 | |||||
Total deferred tax asset | 26,815 | 24,696 | |||||
Valuation allowance | (15,892 | ) | (17,117 | ) | |||
Net long-term deferred tax asset | $ | — | $ | — |
Jurisdiction | Tax Years Subject to Examination: | |
US Federal | 2013 - 2015 | |
Colorado | 2012 - 2015 | |
Maine | 2013 - 2015 | |
Montana | 2014 - 2015 | |
Australia | 2012 - 2015 | |
United Kingdom | 2012 - 2015 |
Federal Net Operating Losses | State Net Operating Losses | Federal Foreign Tax Credit | |||||||||
(In thousands) | |||||||||||
Expires: | |||||||||||
2017 | $ | — | $ | 8 | $ | 310 | |||||
2018 | — | 4,659 | — | ||||||||
2019 | — | 559 | 1,411 | ||||||||
2020 | — | 2,212 | 624 | ||||||||
2021 | — | 27 | 1,443 | ||||||||
2022 | — | 7,848 | 3,655 | ||||||||
2023 and thereafter | 22,209 | 8,690 | 1,668 | ||||||||
Total | $ | 22,209 | $ | 24,003 | $ | 9,111 |
June 30, | |||||||||
2016 | 2015 | ||||||||
Number of Shares | WAEPS (1) | Number of Shares | WAEPS (1) | ||||||
Fiscal year beginning balance | 1,032,334 | $11.15 | 1,311,528 | $10.08 | |||||
Granted | — | $0.00 | 223,123 | $13.83 | |||||
Exercised | — | $0.00 | (61,849 | ) | $8.74 | ||||
Forfeited/canceled | (13,958 | ) | $7.60 | (427,969 | ) | $9.68 | |||
Expired | (291,403 | ) | $10.91 | (12,499 | ) | $8.90 | |||
Options outstanding at end of fiscal year | 726,973 | $11.32 | 1,032,334 | $11.15 | |||||
Weighted average remaining contractual term of outstanding options | 6.2 years | 5.6 years |
Options outstanding | Options exercisable | |||||||||||||||||
Range of exercise prices | Number of shares | Weighted average remaining contractual life | WAEPS (1) | Number of shares | Weighted average remaining contractual life | WAEPS (1) | ||||||||||||
$6.32 | - | $8.32 | 253,122 | 7.3 years | $8.12 | 71,092 | 7.2 years | $7.93 | ||||||||||
$8.33 | - | $9.04 | 119,167 | 5.6 years | $8.71 | 115,000 | 5.5 years | $8.73 | ||||||||||
$9.05 | - | $12.00 | 60,936 | 2.4 years | $9.53 | 60,936 | 2.4 years | $9.53 | ||||||||||
$12.01 | - | $14.56 | 156,248 | 8.3 years | $14.40 | — | 0.0 years | $— | ||||||||||
$14.57 | - | $17.92 | 137,500 | 3.9 years | $16.76 | 137,500 | 3.9 years | $16.76 | ||||||||||
726,973 | 6.2 years | $11.32 | 384,528 | 4.7 years | $11.58 | |||||||||||||
Aggregate intrinsic value | $ | — | $ | — |
June 30, 2015 | |||||||||||||||
TBOs | PBOs (1) | MBOs (2) | |||||||||||||
Number of options | 16,875 | 156,250 | 49,998 | ||||||||||||
Weighted-average grant date fair value per share | $3.73 | $7.13 | $9.39 | ||||||||||||
Expected dividend | $0.00 | $0.00 | $0.00 | ||||||||||||
Forfeiture rate | 23 | % | 15 | % | 15 | % | |||||||||
Risk-free interest rate | 1.5 | % | 1.68 | % | - | 1.70 | % | 2.4 | % | ||||||
Expected life (years) | 6.0 | 5.3 | - | 5.4 | 3.2 | - | 3.9 | ||||||||
Expected volatility (based on historical price) | 57.4 | % | 53.6 | % | - | 54.1 | % | 64.4 | % |
• | Dividends. Holders of Series A Preferred Stock were entitled to a dividend equivalent to 7.0% per annum on the face value, which is the Purchase Price plus any accumulated unpaid dividends, payable quarterly in arrears. Dividends are generally payable in kind ("PIK") (in the form of additional shares of Series A Preferred Stock) or in cash, at the Company's option. |
• | Conversion. Each share of Series A Preferred Stock was convertible at any time, at the holder's option, into one share of common stock, based on an initial face amount and conversion price equal to the Purchase Price. The Series A Preferred Stock was entitled to customary anti-dilution protections. |
• | Voting. The Series A Preferred Stock was entitled to vote on an as-converted basis with the Common Stock. |
• | Forced Conversion. At any time after the third anniversary of the Closing Date, the Company had the right to cause the holders to convert all, but not less than all, of the shares of Series A Preferred Stock into shares of common stock, if, among other conditions: (i) the average per share price of common stock equaled or exceeded 200% of the conversion price for a period of 20 out of 30 consecutive trading days, (ii) the average daily trading volume of shares of common stock exceeded an amount equal to the number of shares of common stock issuable upon the conversion of all outstanding shares of Series A Preferred Stock divided by 45, and (iii) the resale of shares of |
• | Redemption. At any time after the third anniversary of the Closing Date, and upon 30 days prior written notice, the Company could elect to redeem all, but not less than all, shares of Series A Preferred Stock for an amount equal to the greater of (i) the closing sale price of the common stock on the date the Company delivers such notice multiplied by the number of shares of common stock issuable upon conversion of the outstanding Series A Preferred Stock, and (ii) a cash payment that, when considering all cash dividends already paid, would have allowed the holders of Series A Preferred Stock to achieve a 20% annualized internal rate of return on the then-outstanding Series A Preferred Stock. The holders of Series A Preferred Stock would have had the right to convert the Series A Preferred Stock into shares of common stock at any time prior to the close of business on the redemption date. |
• | Change in Control. In the event of a Change in Control (as defined in the Certificate of Designations) of the Company, holders of Series A Preferred Stock would have had the option to (i) convert Series A Preferred Stock into common stock immediately prior to the Change in Control, (ii) in certain circumstances, receive stock or securities in the acquirer of the Company having substantially identical terms as those of the Series A Preferred Stock, or (iii) receive a cash payment that, when considering all cash dividends already paid, would allow the holders of Series A Preferred Stock to achieve a 20% annualized internal rate of return on the then-outstanding Series A Preferred Stock. |
• | Liquidation. Upon a liquidation event, holders of Series A Preferred Stock would have been entitled to a non-participating liquidation preference per share of Series A Preferred Stock equal to (i) 115% of the Purchase Price until the second anniversary of the Closing Date, (ii) 110% of the Purchase Price after the second anniversary of the Closing Date until the third anniversary of the Closing Date, (iii) 105% of the Purchase Price after the third anniversary of the Closing Date until the fourth anniversary of the Closing Date, and (iv) thereafter, at the Purchase Price, plus, in each case, any accrued and accumulated dividends on such share. |
• | Ranking. Series A Preferred Stock ranks senior to common stock with respect to dividend rights and rights on liquidation, winding up, and dissolution. |
• | Board Representation. For so long as One Stone owned at least 15% or 10% of the fully diluted shares of common stock (assuming full conversion of the Series A Preferred Stock), the holders of a majority of the then-outstanding shares of Series A Preferred Stock had the right to appoint two members or one member, respectively, to the Company's Board. These directors were not subject to director elections by the holders of common stock at the Company's annual meetings of shareholders. |
• | Minority Veto Rights. For so long as One Stone owned at least 10% of the fully diluted common stock (assuming full conversion of the Series A Preferred Stock), the holders of a majority of the then-outstanding shares of Series A Preferred Stock held veto rights with respect to (i) capital expenditures greater than $15.0 million that are not provided for in the then-current annual budget; (ii) certain related-party transactions; (iii) changes to the Company's principal line of business; and (iv) an increase in the size of the Board to a number greater than 12. |
• | Standstill. For a period of two years following the date of the Series A Purchase Agreement, One Stone was generally prohibited from (i) acquiring direct or beneficial control of any additional equity securities of the Company or any rights thereto; (ii) making, or in any way participating in, directly or indirectly, any solicitation of proxies to vote in any election contest or initiate, propose or otherwise solicit stockholders of the Company for approval of any stockholder proposals; (iii) participating in or forming any voting group or voting trust with respect to any voting securities of the Company; and (iv) seeking to influence, modify, or control management, the Board, or any business, policies, or actions of the Company. Until such time as One Stone no longer held any Series A Preferred Stock, One Stone was prohibited from engaging, directly or indirectly, in any short selling of the common stock. On August 3, 2015, via the First Amendment to the Series A Convertible Preferred Stock Purchase Agreement (the "Series A First Amendment"), Magellan and One Stone agreed to amend and extend the standstill provisions of the Series A Purchase Agreement to December 31, 2015. |
• | Registration Rights. Holders of Series A Preferred Stock were entitled to resale registration rights with respect to the shares of common stock issuable upon conversion of the Series A Preferred Stock. |
June 30, | |||||||||||||
2016 | 2015 | ||||||||||||
Number of shares issued | Amount | Number of shares issued | Amount | ||||||||||
(In thousands, except share amounts) | |||||||||||||
Fiscal year opening balance | 21,162,697 | $ | 25,850 | 20,089,436 | $ | 24,539 | |||||||
Current year PIK dividends shares issued | 1,520,731 | 1,858 | 1,073,261 | 1,311 | |||||||||
Adjustment to redemption value | — | (4,207 | ) | — | — | ||||||||
Fiscal year closing balance | 22,683,428 | $ | 23,501 | 21,162,697 | $ | 25,850 |
June 30, | |||||||||||||
2016 | 2015 | ||||||||||||
Number of shares issued | Amount | Number of shares issued | Amount | ||||||||||
(In thousands, except share amounts) | |||||||||||||
Fiscal year opening balance | 1,209,389 | $ | 9,806 | 1,178,139 | $ | 9,344 | |||||||
Shares repurchased from former executive | — | — | 31,250 | 462 | |||||||||
Net shares repurchased for employee tax and option exercise price obligations related to the vesting of restricted stock and the exercise of employee stock options | 5,220 | 11 | 5,981 | 104 | |||||||||
Net shares repurchased to eliminate fractional shares in July 10, 2015 one share for eight shares reverse stock split | 2,284 | 6 | |||||||||||
Cancellation of shares repurchased | (7,504 | ) | (17 | ) | (5,981 | ) | (104 | ) | |||||
Fiscal year closing balance | 1,209,389 | $ | 9,806 | 1,209,389 | $ | 9,806 |
June 30, | |||||||
2016 | 2015 | ||||||
(In thousands, except share and per share amounts) | |||||||
Loss from continuing operations, net of tax | $ | (3,328 | ) | $ | (21,596 | ) | |
Preferred stock dividend | (1,858 | ) | (1,740 | ) | |||
Adjustment of preferred stock to redemption value (Note 12) | 4,207 | — | |||||
Net loss from continuing operations, including preferred stock dividends and adjustment to redemption value of preferred stock | (979 | ) | (23,336 | ) | |||
Net loss from discontinued operations | (14,249 | ) | (21,404 | ) | |||
Net loss attributable to common stockholders | $ | (15,228 | ) | $ | (44,740 | ) | |
Basic weighted-average shares outstanding | 5,746,307 | 5,710,288 | |||||
Add: dilutive effects of in-the-money stock options and convertible preferred stock (1) | — | — | |||||
Diluted weighted-average common shares outstanding | 5,746,307 | 5,710,288 | |||||
Basic and diluted loss per common share: | |||||||
Net loss from continuing operations, including preferred stock dividends and adjustment to redemption value of preferred stock | $(0.17) | $(4.09) | |||||
Net loss from discontinued operations | $(2.48) | $(3.75) | |||||
Net loss attributable to common stockholders | $(2.65) | $(7.83) |
June 30, | |||||
2016 | 2015 | ||||
In-the-money stock options | — | 27,673 | |||
Common shares issuable upon conversion of Series A Preferred Stock | 2,714,503 | 2,543,312 | |||
Total | 2,714,503 | 2,570,985 |
June 30, | |||||||
2016 | 2015 | ||||||
(In thousands) | |||||||
Net income (loss) from continuing operations: | |||||||
MPA | 1,497 | (16,146 | ) | ||||
MPUK | (371 | ) | (1,079 | ) | |||
Corporate | (4,507 | ) | (4,394 | ) | |||
Inter-segment eliminations | 53 | 23 | |||||
Consolidated net losses from continuing operations | $ | (3,328 | ) | $ | (21,596 | ) | |
Assets: | |||||||
MPA | 1,194 | 4,593 | |||||
MPUK (1) | 1,234 | 1,067 | |||||
Corporate | 61,315 | 60,733 | |||||
Inter-segment eliminations (2) | (58,235 | ) | (58,129 | ) | |||
Consolidated assets of continuing operations | $ | 5,508 | $ | 8,264 | |||
Expenditures for additions to long-lived assets: | |||||||
MPUK | — | — | |||||
Corporate | 1 | 3 | |||||
Consolidated expenditures for long-lived assets of continuing operations | $ | 1 | $ | 3 |
June 30, | |||||||
2016 | 2015 | ||||||
(In thousands) | |||||||
Depreciation: | |||||||
Corporate | 54 | 148 | |||||
Consolidated depreciation | $ | 54 | $ | 148 | |||
Exploration: | |||||||
MPA | 53 | 91 | |||||
MPUK | 18 | 148 | |||||
Consolidated exploration | $ | 71 | $ | 239 |
Total | |||
(In thousands) | |||
Amounts payable in fiscal year: | |||
2017 | $ | 175 | |
2018 | 74 | ||
Total | $ | 249 |
June 30, | |||||||
2016 | 2015 | ||||||
Severance - Termination Benefits | Severance - Termination Benefits | ||||||
(In thousands) | |||||||
Fiscal year beginning balance | $ | — | $ | — | |||
Charges to general and administrative expense | — | 475 | |||||
Cash payments | — | (475 | ) | ||||
Fiscal year closing balance | $ | — | $ | — |
June 30, 2016 | |||||||||||
Foreign currency translation | Unrealized investment holding loss | Total | |||||||||
(In thousands) | |||||||||||
Fiscal year opening balance | $ | 5,302 | $ | — | $ | 5,302 | |||||
Changes in comprehensive income: | |||||||||||
Other comprehensive loss | (125 | ) | (265 | ) | (390 | ) | |||||
Net current period other comprehensive loss | (125 | ) | (265 | ) | (390 | ) | |||||
Fiscal year ended June 30, 2016 | $ | 5,177 | $ | (265 | ) | $ | 4,912 |
As Reported | Exchange Transaction Pro Forma Adjustments | Sale of Weald Basin Pro Forma Adjustments | Pro Forma as Adjusted | |||||||||||||
ASSETS | ||||||||||||||||
CURRENT ASSETS: | ||||||||||||||||
Cash and cash equivalents | $ | 1,680 | $ | 433 | (a),(b) | $ | 598 | (f) | $ | 2,711 | ||||||
Securities available-for-sale | 601 | — | 941 | (f) | 1,542 | |||||||||||
Accounts receivable | 16 | — | — | 16 | ||||||||||||
Prepaid and other short-term assets | 2,087 | — | — | 2,087 | ||||||||||||
Current assets held for sale | 26,042 | (24,929 | ) | (c) | (1,113 | ) | (g) | — | ||||||||
Total current assets | 30,426 | (24,496 | ) | 426 | 6,356 | |||||||||||
Property and equipment, net | 455 | — | — | 455 | ||||||||||||
Goodwill | 500 | — | — | 500 | ||||||||||||
Other long-term assets | 169 | (150 | ) | (d) | — | 19 | ||||||||||
Total assets | $ | 31,550 | $ | (24,646 | ) | $ | 426 | $ | 7,330 | |||||||
LIABILITIES AND EQUITY | ||||||||||||||||
CURRENT LIABILITIES: | ||||||||||||||||
Accounts payable | $ | 791 | $ | — | $ | — | $ | 791 | ||||||||
Accrued and other liabilities | 2,826 | (174 | ) | (e) | — | 2,652 | ||||||||||
Notes payable | 783 | (625 | ) | (a) | — | 158 | ||||||||||
Current liabilities held for sale | 10,638 | (9,969 | ) | (c) | (669 | ) | (g) | — | ||||||||
Total current liabilities | 15,038 | (10,768 | ) | (669 | ) | 3,601 | ||||||||||
PREFERRED STOCK: | ||||||||||||||||
Series A convertible preferred stock (par value $0.01per share): Authorized 28,000,000 shares, issued 22,293,295 shares | 23,501 | (23,501 | ) | (c) | — | — | ||||||||||
(DEFICIT) EQUITY: | ||||||||||||||||
Common stock (par value $0.01 per share); Authorized 300,000,000 shares, issued 6,972,023 shares | 70 | — | — | 70 | ||||||||||||
Treasury stock (at cost): 1,209,389 shares | (9,806 | ) | — | — | (9,806 | ) | ||||||||||
Capital in excess of par value | 94,069 | 9,623 | (c) | — | 103,692 | |||||||||||
Accumulated deficit | (96,234 | ) | — | 1,095 | (g) | (95,139 | ) | |||||||||
Accumulated other comprehensive income | 4,912 | — | — | 4,912 | ||||||||||||
Total (deficit) equity | (6,989 | ) | 9,623 | 1,095 | 3,729 | |||||||||||
Total liabilities, preferred stock and (deficit) equity | $ | 31,550 | $ | (24,646 | ) | $ | 426 | $ | 7,330 |
As Reported | Exchange Transaction Pro Forma Adjustments | Sale of Weald Basin Pro Forma Adjustments | Pro Forma as Adjusted | ||||||||||||||
OPERATING EXPENSES: | |||||||||||||||||
Depreciation | $ | 54 | $ | — | $ | — | $ | 54 | |||||||||
Exploration | 71 | — | — | 71 | |||||||||||||
General and administrative | 5,214 | (174 | ) | (e) | — | 5,040 | |||||||||||
Total operating expenses | 5,339 | (174 | ) | — | 5,165 | ||||||||||||
Loss from operations | (5,339 | ) | 174 | — | (5,165 | ) | |||||||||||
OTHER (EXPENSE) INCOME: | |||||||||||||||||
Net interest expense | (4 | ) | — | — | (4 | ) | |||||||||||
Loss on investment in securities | (587 | ) | — | — | (587 | ) | |||||||||||
Gain on sale of bonus rights | 2,514 | — | — | 2,514 | |||||||||||||
Other income | 88 | — | — | 88 | |||||||||||||
Total other (expense) income | 2,011 | — | — | 2,011 | |||||||||||||
Loss from continuing operations, before tax | (3,328 | ) | 174 | — | (3,154 | ) | |||||||||||
Income tax expense | — | — | — | — | |||||||||||||
Loss from continuing operations, net of tax | (3,328 | ) | 174 | — | (3,154 | ) | |||||||||||
Preferred stock dividends | (1,858 | ) | 1,858 | (c) | — | — | |||||||||||
Adjustment of preferred stock to redemption value | 4,207 | (4,207 | ) | (c) | — | — | |||||||||||
Net loss attributable to common stockholders from continuing operations | $ | (979 | ) | $ | (2,175 | ) | $ | — | $ | (3,154 | ) | ||||||
Basic and diluted loss per common share attributable to common stockholders from continuing operations | $ | (0.17 | ) | $ | (0.55 | ) | |||||||||||
Weighted average number of basic and diluted shares outstanding | 5,746,307 | 5,746,307 |
As Reported | Exchange Transaction Pro Forma Adjustments | Sale of Weald Basin Pro Forma Adjustments | Pro Forma as Adjusted | ||||||||||||||
OPERATING EXPENSES: | |||||||||||||||||
Depreciation | $ | 148 | $ | — | $ | — | $ | 148 | |||||||||
Exploration | 239 | — | — | 239 | |||||||||||||
General and administrative | 7,946 | (174 | ) | (e) | — | 7,772 | |||||||||||
Loss on sale of assets | 316 | — | — | 316 | |||||||||||||
Total operating expenses | 8,649 | (174 | ) | — | 8,475 | ||||||||||||
Loss from operations | (8,649 | ) | 174 | — | (8,475 | ) | |||||||||||
OTHER (EXPENSE) INCOME: | |||||||||||||||||
Loss on investment in securities | (15,087 | ) | — | — | (15,087 | ) | |||||||||||
Fair value revision of contingent consideration payable | 1,888 | — | — | 1,888 | |||||||||||||
Other income | 252 | — | — | 252 | |||||||||||||
Total other (expense) income | (12,947 | ) | — | — | (12,947 | ) | |||||||||||
Loss from continuing operations, before tax | (21,596 | ) | 174 | — | (21,422 | ) | |||||||||||
Income tax expense | — | — | — | — | |||||||||||||
Loss from continuing operations, net of tax | (21,596 | ) | 174 | — | (21,422 | ) | |||||||||||
Preferred stock dividends | (1,740 | ) | 1,740 | (c) | — | — | |||||||||||
Net loss attributable to common stockholders from continuing operations | $ | (23,336 | ) | $ | 1,914 | $ | — | $ | (21,422 | ) | |||||||
Basic and diluted loss per common share attributable to common stockholders from continuing operations | $ | (4.09 | ) | $ | (3.75 | ) | |||||||||||
Weighted average number of basic and diluted shares outstanding | 5,710,288 | 5,710,288 |
Oil (Mbbls) | ||
Proved Reserves: | ||
Fiscal year ended June 30, 2014 | 5,735.7 | |
Revision of previous estimates | (3,417.1 | ) |
Production | (79.0 | ) |
Fiscal year ended June 30, 2015 | 2,239.6 | |
Revision of previous estimates | (1,284.4 | ) |
Production | (60.2 | ) |
Fiscal year ended June 30, 2016 | 895.0 | |
Proved Developed Reserves: | ||
Fiscal year ended June 30, 2015 | 2,239.6 | |
Fiscal year ended June 30, 2016 | 895.0 | |
Proved Undeveloped Reserves: | ||
Fiscal year ended June 30, 2015 | — | |
Fiscal year ended June 30, 2016 | — |
June 30, | ||||
2016 | 2015 | |||
Oil (per Bbl) | $34.11 | $58.93 |
Year Ended June 30, | |||||||
2016 | 2015 | ||||||
(In thousands) | |||||||
Future cash inflows | $ | 30,527 | $ | 131,979 | |||
Future production costs | (22,366 | ) | (85,372 | ) | |||
Future development costs | (1,463 | ) | (7,021 | ) | |||
Future income tax expense | — | — | |||||
Future net cash flows | 6,698 | 39,586 | |||||
10% annual discount | (4,111 | ) | (22,569 | ) | |||
Standardized measures of discounted future net cash flows | $ | 2,587 | $ | 17,017 |
United States | |||
(In thousands) | |||
Fiscal year ended June 30, 2014 | $ | 87,043 | |
Net change in prices and production costs | (71,406 | ) | |
Revisions of previous quantity estimates | (54,415 | ) | |
Divestiture of reserves | — | ||
Changes in estimated future development costs | 9,071 | ||
Sales and transfers of oil and gas produced | (440 | ) | |
Previously estimated development cost incurred during the period | 7,749 | ||
Accretion of discount | 8,853 | ||
Net change in income taxes (1) | 32,188 | ||
Net change in timing and other | (1,626 | ) | |
Fiscal year ended June 30, 2015 | 17,017 | ||
Net change in prices and production costs (2) | (10,953 | ) | |
Revisions of previous quantity estimates (3) | (5,757 | ) | |
Divestiture of reserves | — | ||
Changes in estimated future development costs | 4,014 | ||
Sales and transfers of oil and gas produced | (3,208 | ) | |
Previously estimated development cost incurred during the period | 338 | ||
Accretion of discount | 1,511 | ||
Net change in income taxes | — | ||
Net change in timing and other | (375 | ) | |
Fiscal year ended June 30, 2016 | $ | 2,587 |
United States | Australia | United Kingdom | Total | ||||||||||||
(In thousands) | |||||||||||||||
Fiscal year ended June 30, 2016 | |||||||||||||||
Proved | $ | — | $ | — | $ | — | $ | — | |||||||
Unproved | — | — | — | — | |||||||||||
Exploration Costs | 162 | 53 | 96 | 311 | |||||||||||
Development Costs | 338 | — | — | 338 | |||||||||||
Total, including asset retirement obligation | $ | 500 | $ | 53 | $ | 96 | $ | 649 | |||||||
Fiscal year ended June 30, 2015 | |||||||||||||||
Proved | $ | — | $ | — | $ | — | $ | — | |||||||
Unproved | — | — | — | — | |||||||||||
Exploration Costs | 1,079 | 91 | 393 | 1,563 | |||||||||||
Development Costs | 7,749 | — | 274 | 8,023 | |||||||||||
Total, including asset retirement obligation | $ | 8,828 | $ | 91 | $ | 667 | $ | 9,586 |
United States | Australia | United Kingdom | Total | ||||||||||||
(In thousands) | |||||||||||||||
Fiscal year ended June 30, 2016 | |||||||||||||||
Fiscal year beginning balance | $ | 19,029 | $ | — | $ | 1,340 | $ | 20,369 | |||||||
Additions to capitalized costs | 361 | — | — | 361 | |||||||||||
Assets sold or held for sale (1)(2) | (15,961 | ) | — | (812 | ) | (16,773 | ) | ||||||||
Reclassified to producing properties | — | — | — | — | |||||||||||
Charged to expense (3) | (3,429 | ) | — | — | (3,429 | ) | |||||||||
Exchange adjustment | — | — | (159 | ) | (159 | ) | |||||||||
Fiscal year closing balance | $ | — | $ | — | $ | 369 | $ | 369 | |||||||
Fiscal year ended June 30, 2015 | |||||||||||||||
Fiscal year beginning balance | $ | 19,955 | $ | — | $ | 1,890 | $ | 21,845 | |||||||
Additions to capitalized costs | 8,047 | — | 274 | 8,321 | |||||||||||
Assets sold or held for sale | — | — | (680 | ) | (680 | ) | |||||||||
Reclassified to producing properties (4) | (8,973 | ) | — | — | (8,973 | ) | |||||||||
Charged to expense | — | — | (20 | ) | (20 | ) | |||||||||
Exchange adjustment | — | — | (124 | ) | (124 | ) | |||||||||
Fiscal year closing balance | $ | 19,029 | $ | — | $ | 1,340 | $ | 20,369 |
• | pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the Company; |
• | provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles and that receipts and expenditures of the Company are being made only in accordance with authorizations of management and directors of the Company; and |
• | provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the Company's assets that have a material effect on the financial statements. |
Name | Age | Office Held | Length of Service as Officer | |||
Antoine J. Lafargue | 42 | President and Chief Executive Officer, Chief Financial Officer, Treasurer and Corporate Secretary | Since August 2010 |
ITEM | PAGE |
Report of Independent Registered Public Accounting Firm | |
Consolidated Balance Sheets | |
Consolidated Statements of Operations | |
Consolidated Statements of Comprehensive Loss | |
Consolidated Statements of Stockholders’ (Deficit) Equity | |
Consolidated Statements of Cash Flows | |
Notes to Consolidated Financial Statements |
EXHIBIT | |
NUMBER | DESCRIPTION |
2.1 | Purchase and Sale Agreement among Magellan Petroleum Corporation and the members of Nautilus Technical Group LLC and Eastern Rider LLC, dated as of September 2, 2011 (filed as Exhibit 2.2 to the registrant's Quarterly Report on Form 10-Q on November 14, 2011 and incorporated herein by reference) |
2.2 | Sale Agreement among Magellan Petroleum (NT) Pty Ltd, Santos QNT Pty Ltd, and Santos Limited, dated September 14, 2011 (filed as Exhibit 2.3 to the registrant's Quarterly Report on Form 10-Q on November 14, 2011 and incorporated herein by reference) |
2.3+ | Share Sale and Purchase Deed dated February 17, 2014, among Magellan Petroleum Australia Pty Ltd, Magellan Petroleum (N.T) Pty. Ltd., Magellan Petroleum Corporation, Jarl Pty. Ltd., Central Petroleum PVD Pty. Ltd, and Central Petroleum Limited (filed as Exhibit 10.1 to the registrant's Current Report on Form 8-K on February 18, 2014 and incorporated herein by reference) |
2.4 | Escrow Agency Deed dated February 17, 2014, between Magellan Petroleum Australia Pty Ltd and Central Petroleum PVD Pty. Ltd. (filed as Exhibit 10.2 to the registrant’s Current Report on Form 8-K on February 18, 2014 and incorporated herein by reference) |
2.5+ | Agreement and Plan of Merger, dated as of August 2, 2016, by and among Magellan Petroleum Corporation, Tellurian Investments Inc., and River Merger Sub, Inc. (filed as Exhibit 2.1 to the registrant’s Current Report on Form 8-K on August 3, 2016 and incorporated herein by reference) |
3.1 | Restated Certificate of Incorporation as filed on May 4, 1987 with the State of Delaware, as amended by (a) the Amendment of Article Twelfth, as filed on February 12, 1988 with the State of Delaware (filed as Exhibit 4.B to the registrant's Registration Statement on Form S-8 (Registration No. 333-70567) on January 14, 1999 and incorporated herein by reference); (b) the Certificate of Amendment of Restated Certificate of Incorporation, as filed on December 26, 2000 with the State of Delaware (filed as Exhibit 3(a) to the registrant’s Quarterly Report on Form 10-Q on February 13, 2001 and incorporated herein by reference); (c) the Certificate of Amendment of Restated Certificate of Incorporation related to Articles Twelfth and Fourteenth, as filed on October 15, 2009 with the State of Delaware (filed as Exhibit 3.3 to the registrant’s Quarterly Report on Form 10-Q on February 16, 2010 and incorporated herein by reference); (d) the Certificate of Amendment of Restated Certificate of Incorporation related to Article Thirteenth, as filed on October 15, 2009 with the State of Delaware (filed as Exhibit 3.4 to the registrant’s Quarterly Report on Form 10-Q on February 16, 2010 and incorporated herein by reference); (e) the Certificate of Amendment of Restated Certificate of Incorporation related to Article Fourth, as filed on December 10, 2010 with the State of Delaware (filed as Exhibit 3.1 to the registrant’s Current Report on Form 8-K on December 13, 2010 and incorporated herein by reference); and (f) the Certificate of Amendment of Restated Certificate of Incorporation, as filed on July 10, 2015 with the State of Delaware (filed as Exhibit 3.1 to the registrant’s Current Report on Form 8-K on August 19, 2013 and incorporated herein by reference) |
3.2 | By-Laws as amended on June 13, 2013 (filed as Exhibit 3.1 to the registrant's Current Report on Form 8-K on June 18, 2013 and incorporated herein by reference) |
4.1 | Certificate of Designations of Series A Convertible Preferred Stock as filed on May 17, 2013 with the State of Delaware (filed as Exhibit 3.6 to the registrant's Current Report on Form 8-K on June 26, 2013 and incorporated herein by reference), as amended by Certificate of Amendment to Certificate of Designations of Series A Convertible Preferred Stock as filed on August 19, 2013 with the State of Delaware (filed as Exhibit 3.1 to the registrant's Current Report on Form 8-K on August 19, 2013 and incorporated herein by reference) |
4.2 | Certificate of Elimination of Series A Convertible Preferred Stock as filed on August 1, 2016 with the State of Delaware (filed as Exhibit 4.1 to the registrant's Current Report on Form 8-K on August 2, 2016 and incorporated herein by reference) |
4.3++ | Registration Rights Agreement dated May 17, 2013 between Magellan Petroleum Corporation and One Stone Holdings II LP (filed as Exhibit 4.1 to the registrant's Current Report on Form 8-K filed on June 26, 2013 and incorporated herein by reference) |
10.1++ | 1998 Stock Option Plan (filed as Exhibit 4.A. to the registrant's Registration Statement on Form S-8 on January 14, 1999 (Registration No. 333-70567) and incorporated herein by reference), as amended by First Amendment to the 1998 Stock Option Plan dated October 24, 2007 (filed as Exhibit 10(n) to the registrant’s Annual Report on Form 10-K for the fiscal year ended June 30, 2008 and incorporated herein by reference) |
10.2++ | 1998 Stock Incentive Plan, as amended and restated through September 28, 2010 (filed as Exhibit 10.1 to the registrant's Current Report on Form 8-K on December 13, 2010 and incorporated herein by reference), as amended by Amendment to 1998 Stock Incentive Plan effective as of September 9, 2014 (filed as Exhibit 10.1 to the registrant’s Current Report on Form 8-K on September 11, 2014 and incorporated herein by reference) |
10.3++ | Magellan Petroleum Corporation 2012 Omnibus Incentive Compensation Plan (filed as Exhibit 10.2 to the registrant's Current Report on Form 8-K on January 17, 2013 and incorporated herein by reference) |
10.4++ | Form of Non-Qualified Stock Option Award Agreement between Magellan Petroleum Corporation and officers and directors (filed as Exhibit 10.1 to the registrant's Current Report on Form 8-K on November 30, 2005 and incorporated herein by reference), as amended by Form of Amendment to Non-Qualified Stock Option Agreement between Magellan Petroleum Corporation and directors (filed as Exhibit 10.2 to the registrant’s Current Report on Form 8-K on December 15, 2008 and incorporated herein by reference) |
10.5++ | Non-Qualified Stock Option Award Agreement between Magellan Petroleum Corporation and William H. Hastings, dated as of February 3, 2009 (filed as Exhibit 10.3 to the registrant's Current Report on Form 8-K on February 9, 2009 and incorporated herein by reference) |
10.6++ | Non-Qualified Stock Option Performance Award Agreement between Magellan Petroleum Corporation and William H. Hastings, dated as of February 3, 2009 (filed as Exhibit 10.4 to the registrant's Current Report on Form 8-K on February 9, 2009 and incorporated herein by reference) |
10.7++ | Amended and Restated Warrant Agreement between Magellan Petroleum Corporation and Young Energy Prize S.A., dated March 11, 2010 (filed as Exhibit 10.1 to the registrant's Quarterly Report on Form 10-Q on May 14, 2010 and incorporated herein by reference) |
10.8++ | Options and Stock Purchase Agreement dated October 10, 2014 between Magellan Petroleum Corporation and William H. Hastings (filed as Exhibit 10.1 to the registrant’s Current Report on Form 8-K on October 16, 2014 and incorporated herein by reference) |
10.9++ | Form of Indemnification Agreement for directors and officers (filed as Exhibit 10.1 to the registrant’s Current Report on Form 8-K on June 10, 2013 and incorporated herein by reference) |
10.10++ | Non-Qualified Stock Option Award Agreement between Magellan Petroleum Corporation and J. Thomas Wilson, dated July 9, 2009 (filed as Exhibit 10.5 to the registrant's Current Report on Form 8-K on July 14, 2009 and incorporated herein by reference) |
10.11++ | Non-Qualified Stock Option Performance Award Agreement between Magellan Petroleum Corporation and J. Thomas Wilson, dated July 9, 2009 (filed as Exhibit 10.6 to the registrant's Current Report on Form 8-K on July 14, 2009 and incorporated herein by reference) |
10.12++ | Non-Qualified Stock Option Award Agreement between Magellan Petroleum Corporation and J. Thomas Wilson dated November 16, 2011 (filed as Exhibit 10.3 to the registrant's Current Report on Form 8-K/A on November 16, 2011 and incorporated herein by reference) |
10.13++ | Amended and Restated Employment Agreement effective as of October 31, 2014 between Magellan Petroleum Corporation and J. Thomas Wilson (filed as Exhibit 10.1 to the registrant’s Current Report on Form 8-K on December 5, 2014 and incorporated herein by reference), as amended by Amendment to Amended and Restated Employment Agreement executed on February 11, 2015 and effective as of October 31, 2014 between Magellan Petroleum Corporation and J. Thomas Wilson (filed as Exhibit 10.9 to the registrant’s Quarterly Report on Form 10-Q on February 12, 2015 and incorporated herein by reference) |
10.14++ | Form of Non-Qualified Stock Option Award Agreement between Magellan Petroleum Corporation and non-employee directors, dated April 1, 2010 (filed as Exhibit 10.2 to the registrant’s Quarterly Report on Form 10-Q on May 14, 2010 and incorporated herein by reference) |
10.15++ | Employment Agreement effective as of October 31, 2014 between Magellan Petroleum Corporation and Antoine J. Lafargue (filed as Exhibit 10.2 to the registrant’s Current Report on Form 8-K on December 5, 2014 and incorporated herein by reference), as amended by Amendment to Employment Agreement effective as of October 12, 2015 between Magellan Petroleum Corporation and Antoine J. Lafargue (filed as Exhibit 10.23 to the registrant’s Annual Report on Form 10-K for the fiscal year ended June 30, 2015 and incorporated herein by reference) |
10.16++ | Restricted Stock Award Agreement effective as of October 12, 2015 between Magellan Petroleum Corporation and Antoine J. Lafargue (filed as Exhibit 10.24 to the registrant's Annual Report on Form 10-K for the fiscal year ended June 30, 2015 and incorporated herein by reference) |
10.17++ | Transaction Incentive Agreement effective as of October 12, 2015 between Magellan Petroleum Corporation and Antoine J. Lafargue (filed as Exhibit 10.25 to the registrant's Annual Report on Form 10-K for the fiscal year ended June 30, 2015 and incorporated herein by reference) |
10.18++ | Override Bonus Agreement effective as of October 12, 2015 between Magellan Petroleum Corporation and Antoine J. Lafargue (filed as Exhibit 10.26 to the registrant's Annual Report on Form 10-K for the fiscal year ended June 30, 2015 and incorporated herein by reference) |
10.19++ | Non-Qualified Stock Option Award Agreement between Magellan Petroleum Corporation and Antoine J. Lafargue, dated as of August 2, 2010 (filed as Exhibit 10.3 to the registrant’s Current Report on Form 8-K on August 4, 2010 and incorporated herein by reference) |
10.20++ | Non-Qualified Stock Option Performance Award Agreement between Magellan Petroleum Corporation and Antoine J. Lafargue, dated as of August 2, 2010 (filed as Exhibit 10.4 to the registrant’s Current Report on Form 8-K filed on August 4, 2010 and incorporated herein by reference) |
10.21++ | Non-Qualified Stock Option Award Agreement between Magellan Petroleum Corporation and Antoine J. Lafargue dated November 30, 2011 (filed as Exhibit 10.7 to the registrant’s Quarterly Report on Form 10-Q on February 10, 2012 and incorporated herein by reference) |
10.22++ | Non-Qualified Stock Option Performance Award Agreement between Magellan Petroleum Corporation and Antoine J. Lafargue dated November 30, 2011 (filed as Exhibit 10.8 to the registrant’s Quarterly Report on Form 10-Q on February 10, 2012 and incorporated herein by reference) |
10.23++ | Form of Restricted Stock Award Agreement under the 2012 Omnibus Incentive Compensation Plan (filed as Exhibit 10.75 to the registrant’s Annual Report on Form 10-K for the fiscal year ended June 30, 2013 and incorporated herein by reference) |
10.24++ | Form of Non-Qualified Stock Option Award Agreement under the 2012 Omnibus Incentive Compensation Plan (filed as Exhibit 10.76 to the registrant’s Annual Report on Form 10-K for the fiscal year ended June 30, 2013 and incorporated herein by reference) |
10.25++ | Form of Performance-Based Non-Qualified Stock Option Award Agreement under the 2012 Omnibus Incentive Compensation Plan (filed as Exhibit 10.4 to the registrant’s Quarterly Report on Form 10-Q filed on November 12, 2013 and incorporated herein by reference) |
10.26++ | Form of Restricted Stock Award Agreement under the 2012 Omnibus Incentive Compensation Plan (filed as Exhibit 10.4 to the registrant’s Current Report on Form 8-K on December 5, 2014 and incorporated herein by reference) |
10.27++ | Form of Non-Qualified Stock Option Performance Award Agreement for Performance Goal Options under the 2012 Omnibus Incentive Compensation Plan (filed as Exhibit 10.7 to the registrant’s Quarterly Report on Form 10-Q on February 12, 2015 and incorporated herein by reference) (portions of this exhibit have been redacted and are subject to a confidential treatment order granted by the U.S. Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities Exchange Act of 1934) |
10.28++ | Form of Non-Qualified Stock Option Performance Award Agreement for Target Stock Price Options and Performance Goal Options under the 2012 Omnibus Incentive Compensation Plan (filed as Exhibit 10.8 to the registrant’s Quarterly Report on Form 10-Q on February 12, 2015 and incorporated herein by reference) (portions of this exhibit have been redacted and are subject to a confidential treatment order granted by the U.S. Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities Exchange Act of 1934) |
10.29++ | Employment Agreement effective as of October 31, 2014 between Magellan Petroleum Corporation and Matthew R. Ciardiello (filed as Exhibit 10.3 to the registrant’s Current Report on Form 8-K on December 5, 2014 and incorporated herein by reference) |
10.30 | Registration Rights Agreement among Magellan Petroleum Corporation and the members of Nautilus Technical Group LLC and Eastern Rider LLC, dated September 2, 2011 (filed as Exhibit 10.2 to the registrant's Quarterly Report on Form 10-Q on November 14, 2011 and incorporated herein by reference) |
10.31 | Gas Supply and Purchase Agreement among Magellan Petroleum (N.T.) Pty. Ltd., Santos Limited, and Santos QNT Pty. Ltd., dated September 14, 2011 (filed as Exhibit 10.3 to the registrant's Quarterly Report on Form 10-Q on November 14, 2011 and incorporated herein by reference) |
10.32++ | Collateral Purchase Agreement dated January 14, 2013 between Sopak AG and Magellan Petroleum Corporation (filed as Exhibit 10.1 to the registrant's Current Report on Form 8-K filed on January 17, 2013 and incorporated herein by reference) |
10.33++ | Series A Convertible Preferred Stock Purchase Agreement dated May 10, 2013 between Magellan Petroleum Corporation and One Stone Holdings II LP (filed as Exhibit 10.1 to the registrant's Current Report on Form 8-K on May 13, 2013 and incorporated herein by reference), as amended by First Amendment dated as of August 3, 2015 to Series A Convertible Preferred Stock Purchase Agreement dated May 10, 2013 between Magellan Petroleum Corporation and One Stone Holdings II LP (filed as Exhibit 10.42 to the registrant's Annual Report on Form 10-K for the fiscal year ended June 30, 2015 and incorporated herein by reference) |
10.34++ | Gas Supply and Purchase Agreement dated September 12, 2013, between Magellan Petroleum (NT) Pty Ltd and Power and Water Corporation (filed as Exhibit 10.1 to the registrant’s Current Report on Form 8-K on September 12, 2013 and incorporated herein by reference) (portions of this exhibit have been redacted and are subject to a confidential treatment order granted by the U.S. Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities Exchange Act of 1934) |
10.35 | Loan Agreement dated September 17, 2014 between Nautilus Poplar LLC as the Borrower, Magellan Petroleum Corporation as the Guarantor and West Texas State Bank as the Lender (filed as Exhibit 10.57 to the registrant’s Annual Report on Form 10-K for the fiscal year ended June 30, 2014 and incorporated herein by reference) |
10.36 | Promissory Note Agreement dated September 17, 2014 between Nautilus Poplar LLC as the Borrower and West Texas State Bank as the Lender (filed as Exhibit 10.58 to the registrant’s Annual Report on Form 10-K for the fiscal year ended June 30, 2014 and incorporated herein by reference) |
10.37 | Guarantee Agreement dated September 17, 2014 between Nautilus Poplar LLC as the Borrower, Magellan Petroleum Corporation as the Guarantor and West Texas State Bank as the Lender (filed as Exhibit 10.59 to the registrant’s Annual Report on Form 10-K for the fiscal year ended June 30, 2014 and incorporated herein by reference) |
10.38 | Deed of Trust, Mortgage, Security Agreement, Assignment of Production and Financing Statement dated September 17, 2014 between Nautilus Poplar LLC as the Grantor and West Texas State Bank as Lender (filed as Exhibit 10.60 to the registrant’s Annual Report on Form 10-K for the fiscal year ended June 30, 2014 and incorporated herein by reference) |
10.39 | Restated Loan Agreement dated June 30, 2015, among Nautilus Poplar LLC as the Borrower, Magellan Petroleum Corporation as the Guarantor, and West Texas State Bank as the Lender (filed as Exhibit 10.48 to the registrant’s Annual Report on Form 10-K for the fiscal year ended June 30, 2015 and incorporated herein by reference) |
10.40 | Amended and Restated Unlimited Guaranty dated June 30, 2015, among Nautilus Poplar LLC as the Borrower, Magellan Petroleum Corporation as the Guarantor, and West Texas State Bank as the Lender (filed as Exhibit 10.49 to the registrant’s Annual Report on Form 10-K for the fiscal year ended June 30, 2015 and incorporated herein by reference) |
10.41 | First Amendment dated June 30, 2015 to Deed of Trust dated September 17, 2014 among Nautilus Poplar LLC as the Borrower, Magellan Petroleum Corporation as the Guarantor, and West Texas State Bank as the Lender (filed as Exhibit 10.50 to the registrant’s Annual Report on Form 10-K for the fiscal year ended June 30, 2015 and incorporated herein by reference) |
10.42 | Amended and Restated Promissory Note dated June 30, 2015, among Nautilus Poplar LLC as the Borrower, Magellan Petroleum Corporation as the Guarantor, and West Texas State Bank as the Lender (filed as Exhibit 10.51 to the registrant’s Annual Report on Form 10-K for the fiscal year ended June 30, 2015 and incorporated herein by reference) |
10.43 | Controlled Equity OfferingSM Sales Agreement, dated as of December 24, 2014, between Magellan Petroleum Corporation and Cantor Fitzgerald & Co. (filed as Exhibit 1.1 to the registrant’s Current Report on Form 8-K on December 24, 2014 and incorporated herein by reference) |
10.44+ | Exchange Agreement by and between Magellan Petroleum Corporation and One Stone Holdings II LP, dated as of March 31, 2016 (filed as Exhibit 10.1 to the registrant’s Current Report on Form 8-K/A on April 13, 2016 and incorporated herein by reference) |
10.45+ | Secured Promissory Note by and between Magellan Petroleum Corporation and One Stone Holdings II LP, dated as of April 15, 2016 (filed as Exhibit 10.1 to the registrant’s Current Report on Form 8-K on April 18, 2016 and incorporated herein by reference) |
10.46+ | Pledge Agreement by and between Magellan Petroleum Corporation and One Stone Holdings II LP, dated as of April 15, 2016 (filed as Exhibit 10.2 to the registrant’s Current Report on Form 8-K on April 18, 2016 and incorporated herein by reference) |
10.47++ | Amendment to Compensation Agreements dated as of June 13, 2016, between Magellan Petroleum Corporation and Antoine J. Lafargue (filed as Exhibit 10.1 to the registrant’s Current Report on Form 8-K on July 19, 2016 and incorporated herein by reference) |
21.1* | Subsidiaries of the Registrant |
23.1* | Consent of EKS&H LLLP |
23.2* | Consent of Allen & Crouch Petroleum Engineers Inc. |
31.1* | Certification of Chief Executive Officer and Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 |
32.1** | Certification of Chief Executive Officer and Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 |
99.1* | Summary reserves report of Allen & Crouch Petroleum Engineers, Inc. |
99.2* | Risks Relating to the Business of and Proposed Merger with Tellurian Investments Inc., and the Combined Business Following the Merger |
101.INS* | XBRL Instance Document |
101.SCH* | XBRL Taxonomy Extension Schema Document |
101.CAL* | XBRL Taxonomy Extension Calculation Linkbase Document |
101.DEF* | XBRL Taxonomy Extension Definition Linkbase Document |
101.LAB* | XBRL Taxonomy Extension Label Linkbase Document |
101.PRE* | XBRL Taxonomy Extension Presentation Linkbase Document |
* | Filed herewith. |
** | Furnished herewith. |
+ | Pursuant to Item 601(b)(2) of Regulation S-K, certain schedules and similar attachments have been omitted. The registrant hereby agrees to furnish supplementally a copy of any omitted schedule or attachment to the US Securities and Exchange Commission upon request. |
++ | Management contract or compensatory plan or arrangement. |
MAGELLAN PETROLEUM CORPORATION | ||||
(Registrant) | ||||
Date: | September 13, 2016 | By: | /s/ Antoine J. Lafargue | |
Antoine J. Lafargue, President, Chief Executive Officer, Chief Financial Officer, Treasurer and Corporate Secretary | ||||
(as Principal Executive, Financial and Accounting Officer) | ||||
/s/ Antoine J. Lafargue | Date: | September 13, 2016 | ||
Antoine J. Lafargue, President, Chief Executive Officer, Chief Financial Officer, Treasurer and Corporate Secretary (as Principal Executive, Financial and Accounting Officer) | ||||
/s/ Brendan S. MacMillan | Date: | September 13, 2016 | ||
Brendan S. MacMillan, Director | ||||
/s/ Ronald P. Pettirossi | Date: | September 13, 2016 | ||
Ronald P. Pettirossi, Director | ||||
/s/ J. Robinson West | Date: | September 13, 2016 | ||
J. Robinson West, Director |
EXHIBIT | |
NUMBER | DESCRIPTION |
21.1* | Subsidiaries of the Registrant |
23.1* | Consent of EKS&H LLLP |
23.2* | Consent of Allen & Crouch Petroleum Engineers Inc. |
31.1* | Certification of Chief Executive Officer and Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 |
32.1** | Certification of Chief Executive Officer and Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 |
99.1* | Summary reserves report of Allen & Crouch Petroleum Engineers, Inc. |
99.2* | Risks Relating to the Business of and Proposed Merger with Tellurian Investments Inc., and the Combined Business Following the Merger |
101.INS* | XBRL Instance Document |
101.SCH* | XBRL Taxonomy Extension Schema Document |
101.CAL* | XBRL Taxonomy Extension Calculation Linkbase Document |
101.DEF* | XBRL Taxonomy Extension Definition Linkbase Document |
101.LAB* | XBRL Taxonomy Extension Label Linkbase Document |
101.PRE* | XBRL Taxonomy Extension Presentation Linkbase Document |
* | Filed herewith. |
** | Furnished herewith. |
+ | Management contract or compensatory plan or arrangement. |
SUBSIDIARY | STATE OR OTHER JURISDICTION OF INCORPORATION OR ORGANIZATION | OWNERSHIP | ||
Magellan Petroleum Corporation owns the following subsidiaries directly: | ||||
Magellan Petroleum (UK) Investment Holdings Limited | United Kingdom | 100% | ||
Magellan Petroleum Australia Pty Ltd | Queensland, Australia | 70% | ||
River Merger Sub, Inc. | Delaware | 100% | ||
Magellan Petroleum (UK) Investment Holdings Limited owns the following subsidiary directly: | ||||
Magellan Petroleum (UK) Limited | United Kingdom | 100%(1) | ||
Magellan Petroleum Australia Pty Ltd owns the following subsidiaries directly: | ||||
Magellan Petroleum (Offshore) Pty Ltd | Queensland, Australia | 100% | ||
Lohengrin Pty Ltd | Australia | 50%(2) |
ALLEN & CROUCH PETROLEUM ENGINEERS, INC | ||||
By: | /s/ Richard L. Vine, P.E. | |||
Richard L. Vine, P.E. | ||||
Date: | September 13, 2016 |
By: | /s/ Antoine J. Lafargue | |||
Antoine J. Lafargue, President, Chief Executive Officer, Chief Financial Officer, Treasurer and Corporate Secretary | ||||
(as Principal Executive, Financial and Accounting Officer) | ||||
Date: | September 13, 2016 |
By: | /s/ Antoine J. Lafargue | |||
Antoine J. Lafargue, President, Chief Executive Officer, Chief Financial Officer, Treasurer and Corporate Secretary | ||||
(as Principal Executive, Financial and Accounting Officer) | ||||
Date: | September 13, 2016 |
• | being required to pay a termination fee of up to $1,000,000 under certain circumstances provided in the merger agreement; |
• | payment of costs relating to the merger, such as legal, accounting, financial advisor and printing fees, regardless of whether the merger is completed; |
• | having had the focus of each company’s management on the merger instead of on pursuing other opportunities that could have been beneficial to each company; |
• | being subject to litigation related to any failure to complete the merger; and |
• | in the case of Magellan, (i) the current market price of Magellan common stock may reflect a market assumption that the merger will occur, and a failure to complete the merger could result in negative market perception and a decline in the market price of Magellan common stock; and (ii) continuing to face the risks that it currently faces as an independent company, including limited capital and limited human resources. |
• | as a condition to the merger, Antoine Lafargue, Magellan’s current President and Chief Executive Officer, shall have released any and all contractual or similar obligations payable to him from Magellan or its affiliates, or otherwise owed to him as a result of his services as an officer, director, agent or employee of Magellan or its affiliates, provided that such release, among other things, will be subject to receipt by Mr. Lafargue of an offer of employment by Magellan, effective as of the effective time of the merger, providing for terms and conditions substantially similar to those set forth in the Tellurian disclosure schedule to the merger agreement; |
• | J. Thomas Wilson, former President and Chief Executive Officer of Magellan, for his termination for “Good Reason” (as defined his employment agreement) in connection with the merger will receive (i) monthly severance payments amounting to $300,000 in the aggregate, for a period of 12 months, (ii) payment of his accrued vacation amounting to approximately $106,000, (iii) reimbursement of medical benefits for a period of up to 18 months, estimated to amount to approximately $35,000 in the aggregate, and (iv) reimbursement of outstanding expenses; |
• | pursuant to the merger agreement, any and all contractual or similar obligations payable to Magellan directors from Magellan or its affiliates, or otherwise owed to the Magellan directors as a result of their services as Magellan directors, shall have been released, except for (A) 100,000 shares of Magellan common stock, which will be issued to and divided among the Magellan directors as of the closing of the merger and (B) the total sum of $150,000, to be divided among the Magellan directors and payable in cash at the closing of the merger, provided that such release shall not affect any right of the Magellan directors to indemnification and insurance as provided in the merger agreement; |
• | Magellan’s directors and executive officers hold equity compensation plan awards under the Magellan 1998 Plan or the Magellan 2012 Plan, the vesting of which awards will be accelerated as a result of the merger, in accordance with the terms of those awards and the merger agreement; and |
• | Magellan’s directors and executive officers are entitled to continued indemnification and insurance coverage under the merger agreement. |
• | currency fluctuations; |
• | war or terrorist attack; |
• | expropriation or nationalization of assets; |
• | renegotiation or nullification of existing contracts; |
• | changing political conditions; |
• | changing laws and policies affecting trade, taxation, and investment; |
• | multiple taxation due to different tax structures; |
• | general hazards associated with the assertion of sovereignty over areas in which operations are conducted; and |
• | the unexpected credit rating downgrade of countries in which Tellurian’s LNG customers are based. |
• | design, engineer and receive critical components and equipment necessary for the Driftwood Project to operate in accordance with specifications and address any start-up and operational issues that may arise in connection with the commencement of commercial operations; |
• | attract, develop and retain skilled personnel and engage and retain third-party subcontractors, and address any labor issues that may arise; |
• | post required construction bonds and comply with the terms thereof, and maintain their own financial condition, including adequate working capital; |
• | adhere to any warranties the contractors provide in their EPC contracts; and |
• | respond to difficulties such as equipment failure, delivery delays, schedule changes and failure to perform by subcontractors, some of which are beyond their control, and manage the construction process generally, including engaging and retaining third-party contractors, coordinating with other contractors and regulatory agencies and dealing with inclement weather conditions. |
• | Difficulties or delays in obtaining, or failure to obtain, sufficient debt or equity financing on reasonable terms; |
• | Failure to obtain all necessary government and third-party permits, approvals and licenses for the construction and operation of any of the contemplated LNG Facilities; |
• | Failure to obtain SPAs that generate sufficient revenue to support the financing and construction of the Project; |
• | Difficulties in engaging qualified contractors necessary to the construction of the contemplated Driftwood Project or other LNG Facilities; |
• | Shortages of equipment, material or skilled labor; |
• | Natural disasters and catastrophes, such as hurricanes, explosions, fires, floods, industrial accidents and terrorism; |
• | Unscheduled delays in the delivery of ordered materials; |
• | Work stoppages and labor disputes; |
• | Competition with other domestic and international LNG export terminals; |
• | Unanticipated changes in domestic and international market demand for and supply of natural gas and LNG, which will depend in part on supplies of and prices for alternative energy sources and the discovery of new sources of natural resources; |
• | Unexpected or unanticipated additional improvements; and |
• | Adverse general economic conditions. |
• | an inadequate number of shipyards constructing LNG vessels and a backlog of orders at these shipyards; |
• | political or economic disturbances in the countries where the vessels are being constructed; |
• | changes in governmental regulations or maritime self-regulatory organizations; |
• | work stoppages or other labor disturbances at the shipyards; |
• | bankruptcies or other financial crises of shipbuilders; |
• | quality or engineering problems; |
• | weather interference or catastrophic events, such as a major earthquake, tsunami, or fire; or |
• | shortages of or delays in the receipt of necessary construction materials. |
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Document and Entity Information - USD ($) |
12 Months Ended | ||
---|---|---|---|
Jun. 30, 2016 |
Sep. 09, 2016 |
Dec. 31, 2015 |
|
Document And Entity Information [Abstract] | |||
Document Type | 10-K | ||
Document Period End Date | Jun. 30, 2016 | ||
Amendment Flag | false | ||
Document Fiscal Period Focus | FY | ||
Document Fiscal Year Focus | 2016 | ||
Current Fiscal Year End Date | --06-30 | ||
Entity Central Index Key | 0000061398 | ||
Entity Current Reporting Status | Yes | ||
Entity Filer Category | Smaller Reporting Company | ||
Entity Registrant Name | MAGELLAN PETROLEUM CORP /DE/ | ||
Entity Voluntary Filers | No | ||
Entity Well-known Seasoned Issuer | No | ||
Entity Common Stock Shares Outstanding | 5,879,610 | ||
Entity Public Float | $ 2,857,981 |
Consolidated Balance Sheets (Parentheticals) - USD ($) $ in Thousands |
Jun. 30, 2016 |
Jun. 30, 2015 |
---|---|---|
Accumulated depreciation | $ 517 | $ 463 |
Preferred stock, authorized (in shares) | 50,000,000.0 | |
Common stock, par value (usd per share) | $ 0.01 | $ 0.01 |
Common stock, authorized (in shares) | 300,000,000 | 300,000,000 |
Common stock, issued (in shares) | 6,972,023 | 6,917,027 |
Treasury stock, (in shares) | 1,209,389 | 1,209,389 |
Series A Convertible Preferred Stock | ||
Preferred stock, par value (usd per share) | $ 0.01 | $ 0.01 |
Preferred stock, authorized (in shares) | 28,000,000 | 28,000,000 |
Preferred Stock, issued (in shares) | 22,683,428 | 21,162,697 |
Preferred stock, outstanding (in shares) | 22,683,428 | 21,162,697 |
Preferred stock, liquidation preference | $ 29,093 | $ 28,435 |
Consolidated Statements of Comprehensive Loss - USD ($) $ in Thousands |
12 Months Ended | |
---|---|---|
Jun. 30, 2016 |
Jun. 30, 2015 |
|
Statement of Comprehensive Income [Abstract] | ||
Net loss | $ (17,577) | $ (43,000) |
Other comprehensive (loss) income, net of tax: | ||
Foreign currency translation loss | (125) | (2,141) |
Reclassification of foreign currency translation loss on intercompany account balances to earnings upon reversal of permanent investment in foreign subsidiaries | 0 | 659 |
Reclassification of impairment loss on securities available-for-sale to earnings due to determination as other than temporary | 0 | 15,087 |
Unrealized holding losses on securities available-for-sale | (265) | (6,294) |
Other comprehensive (loss) income, net of tax | (390) | 7,311 |
Comprehensive loss | $ (17,967) | $ (35,689) |
Consolidated Statement of Stockholders' (Deficit) Equity (Parenthetical) |
12 Months Ended | |
---|---|---|
Jul. 10, 2015 |
Jun. 30, 2016 |
|
Statement of Stockholders' Equity [Abstract] | ||
Reverse stock split (usd per share) | 0.125 | 0.125 |
Basis of Presentation |
12 Months Ended |
---|---|
Jun. 30, 2016 | |
Accounting Policies [Abstract] | |
Basis of Presentation | Note 1 - Basis of Presentation Description of Operations Magellan Petroleum Corporation (the "Company" or "Magellan" or "MPC" or "we") is an independent oil and gas exploration and production company. Subject to the closing of the announced merger with Tellurian Investments Inc. (“Tellurian”), Magellan will become a company focused on the development of liquefied natural gas (“LNG”) projects along the United States Gulf Coast. Historically active internationally, Magellan also owns interests in the Horse Hill-1 well and related licenses in the Weald Basin, onshore UK, and an exploration block, NT/P82, in the Bonaparte Basin, offshore Northern Territory, Australia. The Company conducts its operations through two wholly owned subsidiaries corresponding to the geographical areas in which the Company operates: Magellan Petroleum (UK) Limited ("MPUK"), and Magellan Petroleum Australia Pty Ltd ("MPA"). Following the closing of the merger with Tellurian, which is expected in the fourth quarter of calendar year 2016, the combined company will operate its LNG business in the US through its new wholly owned subsidiary, Tellurian. On July 10, 2015, the Company completed a one share-for-eight shares reverse stock split with respect to the Company's common stock. All amounts of shares of common stock, per share prices with respect to common stock, amounts of stock options to purchase common stock, respective exercise prices of each such option, and amounts of shares convertible upon conversion of the Series A convertible preferred stock for periods both prior and subsequent to the split have been adjusted in this report to reflect the reverse stock split. We believe that Magellan’s sources of value are embedded in the Company’s portfolio of assets. Magellan’s strategy is therefore focused on recovering shareholder value by realizing the value of its existing assets. We were founded in 1957 and incorporated in Delaware in 1967. The Company's common stock has been trading on NASDAQ since 1972 under the ticker symbol "MPET". Our principal executive offices are located at 1775 Sherman Street, Suite 1950, Denver, Colorado 80203, and our phone number is (720) 484-2400. Going Concern The Company has incurred losses from operations for the year ended June 30, 2016, of $5.3 million, and has experienced negative cash flows from operations of $2.2 million for the year ended June 30, 2016, and as of June 30, 2016, its cash balance was $1.7 million. The Company continues to experience liquidity constraints and since July 2015, has been selling certain of its assets to fund its operations, which has resulted in a significant reduction in the Company’s monthly cash burn rate. However, these liquidity constraints continue, and proceeds from these asset sales may not provide sufficient liquidity to fund the Company's operations for the next twelve months. As a result of these conditions and events, there is substantial doubt about the Company's ability to continue as a going concern. Because Tellurian’s assets do not currently generate revenues, the combined company is also likely to experience liquidity constraints. However, we believe that upon the closing of the merger with Tellurian, the combined company will be better positioned to raise capital to fund the combined company's operations due to the attributes of Tellurian's business plan and management. Therefore, we believe that Magellan's ability to continue as a going concern in the short-term is subject to the closing of the merger with Tellurian, the primary condition of which closing is the approval by the Company’s shareholders of the merger agreement that is expected to be sought in the fourth quarter of calendar year 2016. However, following the closing of the merger with Tellurian, the combined company may not be able to raise sufficient capital in a timely manner to fund the operations of the combined company. Should the merger with Tellurian not close, the Company will need to pursue other alternatives in order to continue as a going concern. Special Committee of the Board of Directors In light of the Company's constrained capital resources and the significant capital requirements to develop the Poplar field using CO2-EOR, on June 5, 2015, the Company formed a special committee of independent members of the Board of Directors of the Company (the "Special Committee") to i) consider various strategic alternatives potentially available to the Company, which included, but were not limited to, sales of some or all of the assets of the Company, joint ventures, a recapitalization, and a sale or merger of the Company and ii) amend compensation arrangements of executives and employees for the purpose of retention and alignment of interests with the interests of the common stockholders during such strategic alternatives review process. The Special Committee engaged Petrie Partners, LLC as financial advisor to assist in the consideration of such matters. As discussed in Note 2 - One Stone Exchange, on March 31, 2016, the Company and its sole preferred stockholder entered into an Exchange Agreement pursuant to which 100% of the outstanding shares of Magellan Series A convertible preferred stock (the "Series A Preferred Stock") were exchanged in consideration for 100% of the Company's interests in Nautilus Poplar LLC and 51% of the outstanding common units in Utah CO2 LLC (“Utah CO2,” and together with Nautilus Poplar LLC, the "CO2 Business", or "NP", or the "former NP segment"), as adjusted by the Cash Amount (as defined in the Exchange Agreement and discussed further below) (the “Exchange”). As of June 30, 2016, the assets and liabilities of the CO2 Business have been classified as held for sale in the consolidated balance sheets and the results of operations for the years then ended have been included in discontinued operations in the consolidated statements of operations. See Note 4 - Discontinued Operations. As discussed in Note 3 - Sale of Weald Basin Assets, on June 10, 2016, MPUK entered into three concurrent agreements (the "Weald Agreements") for divestiture of certain of its Petroleum Exploration and Development Licenses ("PEDLs"), its peripheral offshore license near the Isle of Wight, and settlement of legal claims related to the Central Weald licenses with its partner and operator, Celtique Energie Weald Limited ("Celtique"). As of June 30, 2016, the settlement with Celtique has been accrued and the assets and liabilities related to these licenses have been classified as held for sale in the consolidated balance sheets, and the results of operations related to the licenses for the years then ended have been included in discontinued operations in the consolidated statements of operations. See Note 4 - Discontinued Operations. As discussed in Note 20 - Subsequent Events, on August 2, 2016, Magellan, Tellurian, and River Merger Sub, Inc., a Delaware corporation and a direct wholly owned subsidiary of Magellan (“Merger Sub”), entered into an Agreement and Plan of Merger (the “Merger Agreement”). Pursuant to the Merger Agreement, each outstanding share of common stock, par value $0.001 per share, of Tellurian will be exchanged for 1.300 shares of common stock, par value $0.01 per share, of Magellan, and Merger Sub will merge with and into Tellurian (the “Merger”), with Tellurian continuing as the surviving corporation and a direct wholly owned subsidiary of Magellan, and Tellurian will be the accounting acquirer. Principles of Consolidation and Basis of Presentation The accompanying consolidated financial statements include the accounts of Magellan and its wholly owned subsidiaries, NP (which has been discontinued), MPUK, and MPA, and have been prepared in accordance with accounting principles generally accepted in the United States ("GAAP") and the instructions to Form 10-K and Regulation S-X published by the US Securities and Exchange Commission (the "SEC"). All intercompany accounts and transactions have been eliminated. Effective with the execution of the Exchange Agreement on March 31, 2016, the Company has reclassified the operations of NP to discontinued operations and reclassified its related assets and liabilities to assets and liabilities held for sale for all periods presented in the accompanying consolidated financial statements. Effective with the execution of the Weald Agreements on June 10, 2016, the Company has reclassified the operations in connection with the respective licenses to discontinued operations and reclassified its related assets and liabilities to assets and liabilities held for sale for all periods presented in the accompanying consolidated financial statements. Certain prior year amounts have been reclassified to conform to the current year presentation. Such reclassifications had no effect on the prior year net loss attributable to common stockholders, accumulated deficit, net assets, or total shareholders' equity. The Company has evaluated events or transactions through the date of issuance of this report in conjunction with the preparation of these consolidated financial statements. All amounts presented are in US dollars, unless otherwise noted. Amounts expressed in Australian currency are indicated as "AUD." Amounts expressed in the currency of the United Kingdom are indicated as "GBP." As of June 30, 2016 the Company owned a 1.9% interest in Central Petroleum Limited (ASX:CTP) ("Central"), a Brisbane-based exploration and production company traded on the Australian Securities Exchange. The Company accounts for this investment as securities available-for-sale in the accompanying consolidated financial statements. Pro Forma Financial Information (Unaudited) Due to the significance of certain transactions that have closed during the third quarter of calendar 2016, including in connection with the Exchange Agreement and the Weald Agreements, we have presented in Note 21 - Pro Forma Financial Information (Unaudited)the effects of these transactions on our consolidated balance sheet at June 30, 2016, and on our consolidated statements of operations for the years ended June 30, 2016, and June 30, 2015, as if they had been completed on June 30, 2016, with respect to balance sheet data, and as if they had become effective on July 1, 2014, with respect to statement of operations data for the years ended June 30, 2016 and 2015. Refer to Note 21 for further information regarding the pro forma effects of these transactions. Use of Estimates The preparation of consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of oil and gas reserves, assets and liabilities, disclosure of contingent assets and liabilities at the date of the consolidated financial statements, and the reported amounts of revenues and expenses, including stock-based compensation expense, during the reporting periods. Actual results could differ from those estimates. Foreign Currency Translation The functional currency of our foreign subsidiaries is their local currency. Assets and liabilities of foreign subsidiaries are translated to US dollars at period-end exchange rates, and our consolidated statements of operations and cash flows are translated at average exchange rates during the reporting periods. Resulting translation adjustments are recorded in accumulated other comprehensive income, a separate component of stockholders' equity. A component of accumulated other comprehensive income will be released into income when the Company executes a partial or complete sale of an investment in a foreign subsidiary or a group of assets of a foreign subsidiary considered a business and/or when the Company no longer holds a controlling financial interest in a foreign subsidiary or group of assets of a foreign subsidiary considered a business. Transactions denominated in currencies other than the local currency are recorded based on exchange rates at the time such transactions arise. Subsequent changes in exchange rates result in foreign currency transaction gains and losses that are reflected in results of operations as unrealized (based on period end translation) or realized (upon settlement of the transactions) and reported under general and administrative expenses in the consolidated statements of operations. During the fiscal year ended June 30, 2015, the Company made a determination that it was no longer permanently invested in its foreign subsidiaries because (i) the Company had begun an effort to repay its intercompany balances through the repatriation of cash from these subsidiaries and (ii) the Company was increasingly focusing on its US operations. As such, the Company recorded on its statement of operations for the fiscal year ended June 30, 2015, an expense reclassification from accumulated other comprehensive income arising from foreign currency exchange losses on its intercompany account balances. Cash and Cash Equivalents and Concentration of Credit Risk The Company considers all highly liquid short-term investments with original maturities of three months or less at the date of acquisition to be cash equivalents. The carrying value of cash and cash equivalents approximates fair value due to the short term nature of these instruments. The Company's financial instruments exposed to concentrations of credit risk consist primarily of cash and cash equivalents. The Company regularly assesses the level of credit risk we are exposed to and whether there are better ways of managing credit risk. The Company invests its cash and cash equivalents with reputable financial institutions. At times, balances deposited may exceed FDIC insured limits. The Company has not incurred any losses related to these deposits. Securities Available-for-Sale Securities available-for-sale are comprised of investments in publicly traded securities and are carried at quoted market prices. Unrealized gains and losses are excluded from earnings and recorded as a component of accumulated other comprehensive income in stockholders' (deficit) equity, net of deferred income taxes. The Company recognizes gains or losses when securities are sold. On a quarterly basis, we perform an assessment to determine whether there have been any events or economic circumstances to indicate that a security with an unrealized loss has suffered an other-than-temporary impairment. The Company performed this analysis as of June 30, 2016, and concluded that it had not incurred an other-than temporary impairment. During the fiscal year ended June 30, 2015, the Company determined that the value of its investment in Central had suffered an other-than temporary impairment. As such, the unrealized loss on this investment was reclassified from other comprehensive income to the consolidated statement of operations at June 30, 2015. Accounts Receivable Trade accounts receivable consist mainly of receivables from oil and gas purchasers. For receivables from working interest partners, the Company typically has the ability to withhold future revenue disbursements to recover non-payment of joint interest billings. Generally, oil and gas receivables are collected within two months. The collectability of accounts receivable is continuously monitored and analyzed based upon historical experience. The use of judgment is required to establish a provision for allowance for doubtful accounts for specific customer collection issues identified. The allowance for doubtful accounts was $0 as of June 30, 2016, and 2015. Assets and Liabilities Held for Sale As a result of the Exchange Agreement executed on March 31, 2016 (see Note 2 - One Stone Exchange), the Company determined that a strategic shift occurred in its business that will have a major effect on the Company's future operations and financial results. Therefore, the Company adjusted the assets and liabilities of NP to the lesser of their carrying value or fair value less costs to sell, which resulted in an impairment write down of $11.3 million, and reclassified them as held for sale in the consolidated balance sheets effective March 31, 2016. The Company also reclassified the results of NP's operations to discontinued operations in the consolidated statements of operations for all periods presented. In addition, on June 10, 2016, the Company executed the Weald ATA (see Note 3 - Sale of Weald Basin Assets). The Company determined that no fair value adjustments of the assets and liabilities disposed of in the Weald ATA was necessary because the net assets were recorded at less than their fair value less costs to sell. The major classes of assets and liabilities held for sale as well as the results of discontinued operations are presented in Note 4 - Discontinued Operations for both NP and the Weald Basin exploration licenses disposed of pursuant to the Weald ATA. The closing of the Exchange took place on August 1, 2016, following its approval at the Company's annual meeting of stockholders on July 13, 2016. The closing of the transactions contemplated by the Weald ATA took place on August 11, 2016. Unaudited pro forma financial statements showing the impact of the closing of transactions contemplated by the Exchange Agreement and the Weald ATA and other events that have occurred subsequent to June 30, 2016 on the Company's financial statements, as if they had been applied at June 30, 2016, have been included in Note 21 - Pro Forma Financial Information (Unaudited). Oil and Gas Exploration and Production Activities The Company follows the successful efforts method of accounting for its oil and gas exploration and production activities. Under this method, all property acquisition costs, and costs of exploratory and development wells are capitalized until a determination is made that the well has found proved reserves or is deemed noncommercial. If an exploratory well is deemed to be noncommercial, the well costs are charged to exploration expense as dry hole costs. Exploration expenses include dry hole costs and geological and geophysical expenses. Noncommercial development well costs are charged to impairment expense if circumstances indicate that a decline in the recoverability of the carrying value may have occurred. The Company records its proportionate share in joint venture operations in the respective classifications of assets, liabilities, and expenses. The cost of CO2 injection is capitalized until a production response is seen as a result of the injection and it is determined that the well has found proved reserves. After oil production from the well begins, CO2 injection costs are expensed as incurred. Depreciation, depletion, and amortization ("DD&A") of capitalized costs related to proved oil and gas properties is calculated on a property-by-property basis using the units-of-production method based upon proved reserves. The computation of DD&A takes into consideration restoration, dismantlement, and abandonment costs as well as the estimated proceeds from salvaging equipment. As all of the Company's proved oil and gas properties related to NP, DD&A has been reclassified to discontinued operations for all periods presented in the accompanying consolidated statements of operations. Effective with the classification of the assets and liabilities of NP to held for sale on March 31, 2016, including the proved oil and gas properties, the Company halted DD&A related to these assets and no further DD&A has been recorded in the accompanying consolidated financial statements for the period from April 1, 2016 through June 30, 2016. The sale of a partial interest in a proved oil and gas property is accounted for as normal retirement, and no gain or loss is recognized as long as the treatment does not significantly affect the units-of-production depletion rate. A gain or loss is recognized for all other sales of producing properties. The sale of a partial interest in an unproved oil and gas property is accounted for as a recovery of cost, with any excess of the proceeds over such cost or related carrying amount recognized as gain. Impairment of Long-Lived Assets The Company reviews the carrying amount of its oil and gas properties and unproved leaseholds for impairment annually or whenever events or changes in circumstances indicate that a decline in the recoverability of their carrying value may have occurred. The Company estimates the expected undiscounted future cash flows of its oil and gas properties and compares such undiscounted future cash flows to the carrying amount of the oil and gas properties to determine if the carrying amount is recoverable. If the carrying amount exceeds the estimated undiscounted future cash flows, the Company will adjust the carrying amount of the oil and gas properties to fair value. The factors used to determine fair value include, but are not limited to, recent sales prices of comparable properties, the present value of estimated future cash flows, net of estimated operating and development costs, using estimates of reserves, future commodity pricing, future production estimates, anticipated capital expenditures, and various discount rates commensurate with the risk and current market conditions associated with realizing the expected cash flows projected. In connection with the Exchange Agreement and the reclassification of NP's oil and gas properties to assets held for sale, the Company undertook such a review at March 31, 2016, and recorded an impairment of the proved oil and gas properties of $7.8 million and an impairment of its wells in progress of $3.4 million, both included in the loss from discontinued operations in the accompanying consolidated statements of operations for the year ended June 30, 2016. The Company used a fairness opinion provided by a third party in connection with the Exchange and an internally developed cash flow model to value the oil and gas properties of NP. As of June 30, 2016, the properties continue to be included in assets held for sale at their adjusted carrying values representing their fair values less costs to sell, which as of June 30, 2016, approximately equaled the fair values less costs to sell as determined at March 31, 2016. The Company also undertook such a review during the year ended June 30, 2015, and as a result of the decline in oil prices, concluded that its proved oil and gas properties were impaired and recorded an impairment loss of $17.4 million in the accompanying consolidated statement of operations. Land, Buildings, and Equipment Land, buildings, and equipment are recorded at cost. Costs of renewals and improvements that substantially extend the useful lives of the assets are capitalized. Maintenance and repair costs are expensed when incurred. Depreciation is calculated using the straight-line method over the estimated useful lives of the assets, which range from three to fifteen years. Goodwill Goodwill represents the excess of the purchase price over the estimated fair value of the assets acquired, net of the fair value of liabilities assumed in an acquisition. The goodwill recorded as of June 30, 2016 and 2015 of $500 thousand related to the Company's foreign subsidiaries, of which amount $275 thousand related to MPA, and $225 thousand related to MPUK. GAAP requires goodwill to be evaluated on an annual basis for impairment, or more frequently if events occur or circumstances change that could potentially result in impairment. For the year ended June 30, 2016, as a result of management's intent to monetize certain assets, including those of its foreign subsidiaries, and the progress of negotiations related to the sale of those assets, the Company performed an analysis of qualitative factors to determine whether further evaluation under GAAP (the two-step test) was required. As a result of this qualitative analysis, the Company determined that it was not more likely than not that the carrying value of its foreign reporting units, including goodwill, were less than their carrying amounts. Therefore, no further testing for impairment of the Company's goodwill balances at June 30, 2016 was performed. As of June 30, 2015, management concluded that as a result of the decline in reserve value, principally due to the decline in commodity prices, and a downward revision in reserve quantities as the result of the exclusion of PUD reserves from the Company's reserve estimates, goodwill related to NP had been impaired. Accordingly, we recorded impairment expense of $674 thousand for the year ended June 30, 2015, which is included in discontinued operations in the accompanying consolidated statement of operations. The qualitative factors used in our assessment included macroeconomic conditions, industry and market conditions, cost factors, and overall financial performance. The quantitative analysis performed included a review of the June 30, 2015 reserve estimates using forward commodity prices and an estimate of the differential less the liabilities for NP, and comparing the result of the analysis to the recorded carrying value of the net assets. The analysis indicated that the carrying value of the net assets exceeded the calculated value of the reserves net of liabilities, and therefore, an impairment had occurred. Asset Retirement Obligations The Company recognizes an estimated liability for future costs associated with the plugging and abandonment of its oil and gas properties. A liability for the fair value of an asset retirement obligation and corresponding increase in the carrying value of the related long-lived asset are recorded at the time a well is acquired or the liability to plug is legally incurred. Assumptions and judgments made by management when assessing an asset retirement obligation include: (i) the existence of a legal obligation; (ii) estimated probabilities, amounts, and timing of settlements; (iii) the credit-adjusted risk-free rate to be used; and (iv) inflation rates. The Company depletes the amount added to proved oil and gas property costs, net of estimated salvage values, and recognizes expense in connection with the accretion of the discounted liability over the remaining estimated economic lives of the respective oil and gas properties. Asset retirement obligations have been classified as held for sale as of all periods presented in the accompanying consolidated balance sheets, as they relate to NP. Revenue Recognition The Company has historically derived revenue primarily from the sale of produced oil. Oil revenues are recognized when production is sold to a purchaser at a fixed or determinable price, when delivery has occurred and title has transferred, and collection of the revenue is probable. Oil revenues have been classified as discontinued operations for all periods presented in the accompanying consolidated statements of operations, as they relate to NP. Major Customers The Company's consolidated oil production revenue is derived from its NP segment and was generated from two customers for the years ended June 30, 2016 and 2015. Stock-Based Compensation Stock option grants may contain time-based, market-based, or performance-based vesting provisions. Time-based options ("TBOs") are expensed on a straight-line basis over the vesting period. Market-based options ("MBOs") are expensed on a straight-line basis over the derived service period, even if the market condition is not achieved. Performance-based options ("PBOs") are amortized on a straight-line basis between the date upon which the achievement of the relevant performance condition is deemed probable and the date the performance condition is expected to be achieved. Management re-assesses whether achievement of performance conditions is probable at the end of each reporting period. If changes in the estimated outcome of the performance conditions affect the quantity of the awards expected to vest, the cumulative effect of the change is recognized in the period of change. The fair value of the stock options is determined on the grant date and is affected by our stock price and other assumptions regarding a number of complex and subjective variables. These variables include our expected stock price volatility over the term of the awards, risk-free interest rates, expected dividends, and the expected option exercise term. The Company estimates the fair value of PBOs and time-based stock options using the Black-Scholes-Merton pricing model. The simplified method is used to estimate the expected term of stock options due to a lack of related historical data regarding exercise, cancellation, and forfeiture. For MBOs, the fair value is estimated using Monte Carlo simulation techniques. Accounting for Income Taxes The Company follows the liability method in accounting for income taxes. Under this method, deferred tax assets and liabilities are determined based on differences between the financial reporting and tax bases of assets and liabilities and are measured using the enacted tax rates and laws that will be in effect when the differences are expected to reverse. The Company records a valuation allowance for deferred tax assets when it is more likely than not that such assets will not be recovered. GAAP prescribes a comprehensive model for recognizing, measuring, presenting, and disclosing in the financial statements uncertain tax positions that the Company has taken or expects to take in its tax returns. Under GAAP, the Company recognizes tax positions when it is more likely than not that a tax position will be sustained upon examination, including resolution of any related appeals or litigation processes, based on the technical merits of the position. In evaluating whether a tax position has met the more-likely-than-not recognition threshold, the Company has presumed that its positions will be examined by the appropriate taxing authority that has full knowledge of all relevant information. The next step consists of measurement. A tax position that meets the more-likely-than-not recognition threshold is measured to determine the amount of benefit to recognize in the financial statements. A tax position is measured at the largest amount of benefit that has a greater than 50% likelihood of being realized upon ultimate settlement. An uncertain income tax position will not be recognized if it does not meet the more-likely-than-not threshold. To appropriately account for income tax matters, the Company is required to make significant judgments and estimates regarding the recoverability of deferred tax assets, the likelihood of the outcome of examinations of tax positions that may or may not be currently under review, and potential scenarios involving settlements of such matters. Changes in these estimates could materially impact the consolidated financial statements. There are no uncertain tax positions that would meet the more-likely-than-not recognition threshold for the fiscal years ended June 30, 2016, or 2015. The Company has adopted an accounting policy to record all tax-related interest under interest expense and tax-related penalties under general and administrative expense in the consolidated statement of operations. Financial Instruments The carrying values for accounts receivable, accounts payable and debt approximate fair value based on the timing of the anticipated cash flows and current market conditions. Segment Information As of June 30, 2016, the Company determined, based on the criteria of Financial Accounting Standards Board (the "FASB") Accounting Standards Codification Topic 280, that it operated in two segments, MPUK and MPA, as well as a head office, Magellan ("Corporate"), which is treated as a cost center. As of June 30, 2016, these two operating segments met the minimum quantitative threshold to qualify for separate segment reporting. The Company's chief operating decision maker is Antoine J. Lafargue (President and CEO of the Company), who reviews the results and manages operations of the Company in the two reporting segments of MPUK and MPA, and Corporate. The presentation of all segment information herein reflects the manner in which the Company's management monitors performance and allocates resources. Prior to signing the Exchange Agreement, and the related reclassification of the assets and liabilities of NP to held for sale, and classification of NP's results of operations to discontinued operations, the Company operated in three segments. For further information pertaining to our reporting segments, see Note 15 - Segment Information. Loss per Common Share Income and losses per common share are based upon the weighted average number of common and common equivalent shares outstanding during the period. The effects of potentially dilutive securities in the determination of diluted earnings per share are the dilutive effect of stock options and the shares of Series A Preferred Stock. The potentially dilutive impact of stock options is determined using the treasury stock method. The potentially dilutive impact of the shares of Series A Preferred Stock is determined using the if-converted method. In applying the if-converted method, conversion is not assumed for purposes of computing dilutive shares if the effect would be anti-dilutive. The Series A Preferred Stock is convertible at a rate of one common share for one preferred share, multiplied by an applicable conversion ratio. We did not include any stock options nor common stock issuable upon the conversion of the Series A Preferred Stock in the calculation of diluted loss per share during the fiscal years ended June 30, 2016, and 2015, as their effect would have been anti-dilutive due to net losses in those periods. Accumulated Other Comprehensive Income Loss Other comprehensive (loss) income is presented net of applicable income taxes in the accompanying consolidated statements of stockholders' (deficit) equity and comprehensive loss. Other comprehensive (loss) income is comprised of revenues, expenses, gains, and losses that under GAAP are reported as separate components of stockholders' (deficit) equity instead of net loss. Recently Issued Accounting Standards In August 2016, the FASB issued Accounting Standards Update ("ASU") No. 2016-15, which is intended to reduce diversity in practice in reporting certain items in the statement of cash flows. This standard will be effective for the Company for its first interim period in its fiscal year ending June 30, 2019, and early adoption is permitted. The Company does not expect adoption of ASU 2016-15 to have a material effect on its consolidated financial statements. In March 2016, the FASB issued ASU No. 2016-09, which is intended to improve the accounting for employee share-based payments and affect all organizations that issue share-based payment awards to their employees. Several aspects of the accounting for share-based payment award transactions are simplified, including: (a) income tax consequences; (b) classification of awards as either equity or liabilities; (c) classification on the statement of cash flows; and (d) accounting for forfeitures. This standard will be effective for the Company for its first interim period in its fiscal year ending June 30, 2018, and early adoption is permitted. The Company is evaluating the impact of the adoption of this standard on its consolidated financial statements. In February 2016, the FASB issued ASU No. 2016-02, which establishes a right-of-use model that requires a lessee to record a right-of-use asset and a lease liability on the balance sheet for all leases with terms longer than 12 months, and provides revised guidance on lease classification as finance or operating, with classification affecting the pattern of expense recognition in the statement of operations or comprehensive loss, and the pattern of cash flow classification in the statement of cash flows. This standard will be effective for the Company for its first interim period in its fiscal year ending June 30, 2020. A modified retrospective transition approach is required for lessees for capital and operating leases existing at, or entered into after, the beginning of the earliest comparative period presented in the financial statements, with certain practical expedients available. The Company is evaluating the impact of the adoption of this standard on its consolidated financial statements. In January 2016, the FASB issued ASU No. 2016-01, which addresses certain aspects of recognition, measurement, presentation and disclosure of financial instruments. This standard will be effective for the Company for its first interim period in its fiscal year ending June 30, 2019, with earlier application not permitted with the exception of certain specific provisions. The Company is evaluating the impact of the adoption of this standard on its consolidated financial statements. In November 2015, the FASB issued ASU No. 2015-17, which simplifies the presentation of deferred income taxes in the classified balance sheet, by removing the requirement to separate current and noncurrent deferred taxes and requiring deferred tax assets and liabilities to be classified as noncurrent. This standard will be effective for the Company for its first interim period in its fiscal year ending June 30, 2018, and early adoption is permitted. The Company does not expect adoption of ASU 2015-17 to have a material effect on its consolidated financial statements. In September 2015, the FASB issued ASU No. 2015-16, which simplifies the accounting for adjustments made to provisional amounts recognized at the acquisition date in a business combination, by eliminating the requirement to retrospectively account for such adjustments for which the accounting is incomplete by the end of the reporting period in which the combination occurs. This standard will be effective for the Company for its first interim period in its fiscal year ending June 30, 2017. The Company is evaluating the impact of the adoption of this standard on its consolidated financial statements. In August 2015, the FASB issued ASU No. 2015-15, which amends presentation and disclosure requirements outlined in ASU 2015-03 by clarifying guidance for debt issuance costs related to line of credit arrangements, provided that the SEC would not object to presentation of debt issuance costs related to a line of credit arrangement as an asset, and amortizing them ratably over the term of the line of credit arrangement. This standard will be effective for the Company for its first interim period in its fiscal year ending June 30, 2017. The Company does not expect adoption of ASU 2015-15 to have a material effect on its consolidated financial statements. In August 2014, the FASB issued ASU No. 2014-15, which provides guidance on management’s responsibility to evaluate whether there is substantial doubt about a company’s ability to continue as a going concern and to provide related footnote disclosures. This standard will be effective for the Company's fiscal year ending June 30, 2017, and annual and interim periods thereafter. The Company is evaluating the impact of the adoption of this standard on its consolidated financial statements. In April 2014, the FASB issued ASU No. 2014-8, which changed the requirements for reporting discontinued operations and disclosures of disposals of components of an entity. ASU 2014-8 is effective for all disposals (or classifications as held for sale) of components of an entity that occur within annual periods beginning on or after December 15, 2014, and interim periods within those years. The Company has adopted this standard and applied its guidance to its reporting and disclosure of the One Stone Exchange, the Weald ATA and the IoW ATA, and discontinued operations of NP and MPUK (see Notes 2, 3 and 4). There are no new significant accounting standards applicable to the Company that have been issued but not yet adopted by the Company as of June 30, 2016. |
One Stone Exchange One Stone Exchange |
12 Months Ended |
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Jun. 30, 2016 | |
Related Party Transactions [Abstract] | |
One Stone Exchange | Note 2 - One Stone Exchange On March 31, 2016, Magellan and One Stone entered into an Exchange Agreement (the “Exchange Agreement”). The Exchange Agreement provides, upon the terms and subject to the conditions set forth in the Exchange Agreement, for the transfer by One Stone to the Company of 100% of the outstanding shares of Magellan Series A convertible preferred stock (the “Series A Preferred Stock”) in consideration for the assignment to and assumption by One Stone of 100% of the outstanding membership interests in Nautilus Poplar LLC and 51% of the outstanding common units in Utah CO2 LLC (“Utah CO2,” and together with Nautilus Poplar LLC, the "CO2 Business"), as adjusted by the Cash Amount (as defined in the Exchange Agreement and discussed further below) (the “Exchange”). The closing of the Exchange was subject to customary closing conditions, including, among others, the receipt of Magellan stockholder approval and the consent of West Texas State Bank ("WTSB") to release a guaranty provided by Magellan. The Exchange Agreement has been approved by each of the Special Committee and the Company’s Board of Directors. Stockholders of the Company were asked to vote on the approval of the Exchange Agreement at a stockholder meeting that took place on July 13, 2016, at which the Exchange Agreement was approved by the stockholders. One Stone was required to vote all shares of Series A Preferred Stock in favor of the Exchange Agreement at the meeting of Magellan stockholders. If the customary closing conditions had not been satisfied, and the Exchange Agreement had been terminated by either party as a result of the failure to obtain the requisite approval by Magellan stockholders, the Company would have been required to reimburse One Stone for all documented out-of-pocket fees and expenses incurred by One Stone in connection with the Exchange Agreement, subject to a maximum of $200 thousand in the aggregate. On August 1, 2016, the transactions contemplated by the Exchange Agreement closed and the Company received the Cash Amount, which amounted to $900 thousand. Pursuant to the Exchange Agreement, on April 15, 2016, Magellan and One Stone i) entered into a Secured Promissory Note (the “Note”) pursuant to which One Stone made a loan to Magellan in the aggregate amount of $625 thousand (the “Loan Amount”) and ii) simultaneously entered into a Pledge Agreement pursuant to which Magellan pledged, assigned and granted to One Stone a security interest in the Company’s interests in MPA, as collateral for the loan. Magellan was required to use the borrowed amounts to satisfy transaction costs and pay certain outstanding accounts payable primarily related to the CO2 Business to maintain its ongoing operations between signing of the Exchange Agreement and closing. The Note did not bear interest up until closing of the Exchange, was expected to be forgiven upon closing of the Exchange, and if the Exchange had not closed, would have become due and payable on August 1, 2016, or, in the case of a breach of the Exchange Agreement by One Stone, August 1, 2017, and would have borne interest from the date of termination of the Exchange Agreement at a rate of the prime rate of interest plus 1% (4.5% at June 30, 2016). At the closing of the Exchange, the Loan Amount was deemed paid in full and no further amounts under the Note are required to be repaid by the Company. The Exchange Agreement has been given economic effect as of September 30, 2015 (the “Effective Date”). At closing, One Stone was expected to pay the Company an amount in cash equal to i) any transaction costs One Stone has agreed to pay pursuant to the Exchange Agreement that have not been paid on or prior to closing, ii) minus (if positive) or plus (if negative) the net revenues and expenses attributable to NP after the Effective Date, plus iii) certain specified liabilities of NP actually paid by the Company or NP prior to closing, minus, (iv) the Loan Amount (the “Cash Amount”). The purpose of the Cash Amount is primarily to reimburse the Company for the funding of the operations of NP during the period between September 30, 2015, and the closing of the Exchange, which operations resulted in a loss in the aggregate for the period. At the end of June 2016, the Company provided a preliminary estimate of the Cash Amount, which amounted to $1.2 million. On August 1, 2016, the final amount agreed between the parties and paid by One Stone to the Company was $900 thousand. In addition, One Stone and Messrs. Gluzman and Israel agreed that the Company would not be required to pay the outstanding fees owed to Messrs. Gluzman and Israel as compensation for services as directors of the Company, which outstanding fees amounted to approximately $174 thousand in a combination of cash and stock of the Company. The Exchange Agreement may have been terminated under certain circumstances, including in specified circumstances in connection with receipt of a Superior Proposal, as such term is defined in the Exchange Agreement. In connection with the termination of the Exchange Agreement in the event of a Superior Proposal, a breach by the Company of the non-solicitation provision, or following a change by the Board of its recommendation to stockholders, in addition to amounts discussed above, the Company would have been required to pay to One Stone a termination fee of $750 thousand. Note 17 - Related Party Transactions Devizes International Consulting Limited. A director of Celtique, with which the Company co-owns equally several licenses in the UK, is also the sole owner of Devizes International Consulting Limited ("Devizes"). Devizes performs consulting services for MPUK. The Company recorded $59 thousand and $147 thousand of consulting fees related to Devizes for the fiscal years ended June 30, 2016, and 2015, respectively. Mervyn Cowie. Mervyn Cowie, a former employee of the Company's MPA subsidiary, currently serves both as a director of MPA and its subsidiaries and as a consultant to MPA. Since December 1, 2014, the recurring monthly fee payable to Mr. Cowie for his consulting services amounts to AUD $5,400. Mi3 Petroleum Engineering. In association with its purchase of an option to acquire CO2 from Farnham Dome, on August 14, 2014, the Company formed a subsidiary, Utah CO2. On December 1, 2014, two other non-controlling interest owners became members of Utah CO2, one of which is Mi4 Oil and Gas, LLC ("Mi4"), a Colorado limited liability company majority owned by Mi3. Mi3 performs ongoing consulting work for both Utah CO2 and other Magellan entities. During the years ended June 30, 2016, and 2015, respectively, the Company recorded $293 thousand and $1.1 million of consolidated expense related to fees payable to Mi3. During the years ended June 30, 2016, and 2015, $293 thousand and $1.1 million, respectively, of the related expense was included in discontinued operations in the accompanying consolidated statement of operations. One Stone Exchange. On March 31, 2016, the Company and its sole preferred stockholder entered into an Exchange Agreement providing for the exchange of 100% of the outstanding shares of Magellan Series A Preferred Stock for the assignment to the preferred stockholder of 100% of the Company's interest in the CO2 Business, subject to certain conditions including Magellan stockholder approval. Refer to Note 2 - One Stone Exchange for further information. |
Sale of Weald Basin Assets Sale of Weald Basin Assets |
12 Months Ended |
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Jun. 30, 2016 | |
Extractive Industries [Abstract] | |
Sale of Weald Basin Assets | Note 3 - Sale of Weald Basin Assets On June 10, 2016, MPUK entered into three concurrent agreements, which resulted in the disposal of its interests in four licenses in the UK and the settlement of all legal claims related to its dispute with Celtique. On June 10, 2016, MPUK entered into i) an Asset Transfer Agreement relating to the sale to UK Oil & Gas Investments PLC ("UKOG") of MPUK's 50% interests in PEDLs 231, 234, and 243 (the "Weald ATA"), ii) an Asset Transfer Agreement relating to the sale to UKOG of MPUK's 22.5% interest in the Offshore Petroleum Licence P1916 (the "IoW ATA"), and iii) a Settlement Agreement with Celtique. The consideration payable by UKOG to MPUK for the Weald ATA amounted to GBP 1.8 million in a combination of cash and shares in UKOG. The number and value of shares of UKOG was determined as of the time of execution of the Weald ATA and was based on the volume weighted average price of an ordinary share of UKOG for the ten business days prior to June 10, 2016. The consideration for the IoW ATA was the assumption of MPUK's outstanding payables related to its interests in the Offshore Petroleum Licence P1916. Pursuant to the terms of the Settlement Agreement, MPUK was due to pay Celtique GBP 500 thousand in a combination of cash and shares in UKOG pro rata to the consideration payable to MPUK for the Weald ATA. The closing of the Weald ATA was subject to customary conditions and the approval by the UK Oil and Gas Authority of, amongst other things, an extension of the term of PEDL 234. The closing of the transactions contemplated by the Weald ATA, IoW ATA, and Settlement Agreement were conditional upon each other and also subject to the completion of the acquisition by UKOG of the entire issued share capital in Celtique, the terms of which acquisition were based on consideration equivalent to that in the Weald ATA. Contemporaneously with these transactions, MPUK and Celtique initiated the process of relinquishing their interests in PEDLs 231 and 243. With respect to the Settlement Agreement, MPUK entered into a settlement agreement with Celtique and its parent Celtique Energie Petroleum Limited (the "Settlement Agreement") which provided for the dismissal of all claims and counterclaims related to PEDLs 231, 234, and 243 between the parties. The Settlement Agreement also included a standstill provision among all parties until the completion of the Weald ATA. On August 11, 2016, the conditions to closing the transactions contemplated by the Weald ATA were met, and the transactions contemplated by all three agreements closed, with MPUK receiving net cash proceeds of GBP 446 thousand and the net issuance to MPUK of approximately 50.9 million shares of UKOG, which shares were worth approximately GBP 703 thousand and GBP 958 thousand as of August 11, 2016, and September 9, 2016, respectively. In connection with the Weald ATA, IoW ATA, and Settlement Agreement, the Company accrued its liabilities to Celtique to the full amount of the consideration payable to Celtique of GBP 500 thousand as of June 30, 2016, and classified its assets and liabilities related to PEDLs 231, 234, and 243, and P1916 to held for sale in the accompanying consolidated balance sheets as of June 30, 2016 and June 30, 2015. The Company also classified the operations related to these licenses to discontinued operations for the years ended June 30, 2016 and 2015. For further information, refer to Note 4 - Discontinued Operations. Note 5 - Sale of Amadeus Basin Assets On March 31, 2014 (the "Central Closing Date"), pursuant to the Share Sale and Purchase Deed dated February 17, 2014 (the "Sale Deed"), the Company sold its Amadeus Basin assets and the Palm Valley and Dingo gas fields ("Palm Valley" and "Dingo," respectively) to Central through the sale of the Company's wholly owned subsidiary, Magellan Petroleum (N.T.) Pty. Ltd ("MPNT"), to Central's wholly owned subsidiary Central Petroleum PV Pty. Ltd ("Central PV"). In exchange for the assets, Central paid to Magellan (i) AUD $20.0 million; (ii) customary purchase price adjustments amounting to AUD $800 thousand; and (iii) 39.5 million newly issued shares of Central stock (ASX: CTP), equivalent to an ownership interest in Central of approximately 11%. The Sale Deed also provides that the Company is entitled to receive 25% of the revenues generated at the Palm Valley gas field from gas sales when the volume-weighted gas price realized at Palm Valley exceeds AUD $5.00/Gigajoule ("GJ") and AUD $6.00/GJ for the first 10 years following the Central Closing Date, and for the following five years, respectively, with such prices to be escalated in accordance with the Australian consumer price index. Between the third and fifth anniversaries of the Central Closing Date, inclusive, the Company may seek from Central a one-time payment (the "Bonus Discharge Amount") corresponding to the present value, assuming an annual discount rate of 10%, of any expected remaining bonus payments in exchange for foregoing future bonus payments. If the Company receives the Bonus Discharge Amount, bonus payments and the Bonus Discharge Amount together may not exceed AUD $7.0 million. The Company also retained its rights to receive any and all bonuses (the "Mereenie Bonus") payable by Santos Ltd ("Santos") and contingent upon production at the Mereenie oil and gas field achieving certain threshold levels. The Mereenie Bonus was established in fiscal year 2011 pursuant to the terms of the asset swap agreement between the Company and Santos for the sale of the Company's interest in Mereenie to Santos and the Company's purchase of the interests of Santos in the Palm Valley and Dingo gas fields. The Company has historically not recognized a contingent asset related to the Bonus Discharge Amount or Mereenie Bonus, as such amounts are not reasonably assured. On May 18, 2016, pursuant to a sale and purchase deed and deed of consent, with appropriate consent from Santos, the Company sold its rights in the Mereenie Bonus for AUD $3.5 million, which translated to $2.5 million on that date. Since no asset had previously been recorded related to the Mereenie Bonus, the Company recorded the entire sales price as a gain for the year ended June 30, 2016. The Company’s ability to repatriate the proceeds from the sale of the Mereenie Bonus to the US was constrained by the terms of the Pledge Agreement the Company entered into in conjunction with the Note with One Stone, until closing of the Exchange on August 1, 2016. |
Discontinued Operations |
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Discontinued Operations and Disposal Groups [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Discontinued Operations | Note 4 - Discontinued Operations On March 31, 2016, the Company entered into an Exchange Agreement with One Stone pursuant to which, subject primarily to stockholder approval, One Stone would transfer its ownership of 100% of Magellan's Series A Preferred Stock in exchange for 100% of Magellan's interest in the CO2 Business. As of March 31, 2016, the Company determined that it was probable that the Exchange would be approved by the stockholders. Therefore, assets and liabilities of the CO2 Business were reclassified as held for sale and recorded at their fair values, less the cost to sell. The assets and liabilities are shown as held for sale for all periods presented. Subsequent to June 30, 2016, on July 13, 2016, the stockholders of Magellan voted in favor of the Exchange and on August 1, 2016 the Exchange closed. In addition, on June 10, 2016, the Company entered into into three concurrent agreements, including the Weald ATA, the IoW ATA, and the Settlement Agreement, which resulted in the disposal of its interests in four licenses in the UK and the settlement of all legal claims related to its dispute with Celtique. As of June 30, 2016, the Company determined that it was probable that the transactions contemplated by these agreements would close, and therefore the assets and liabilities of MPUK related to them were reclassified as held for sale and recorded at the lower of their cost or their fair values, less the cost to sell. The assets and liabilities are shown as held for sale for all periods presented. Subsequent to June 30, 2016, on August 11, 2016, the conditions to completion of these agreements were met, and the transactions contemplated by the Weald ATA, the IoW ATA, and the Settlement Agreement closed. The results of operations of the CO2 Business and the exploration licenses included in the Weald ATA and the IoW ATA, including the settlement of the Celtique litigation were reclassified to discontinued operations in fiscal year 2016. Prior year amounts related to the discontinued operations in the consolidated statements of operations and statements of cash flows have been reclassified to conform to the current period presentation. Summarized results of the Company's discontinued operations are as follows:
The Company reviewed the recoverability of the carrying values of its assets and liabilities related to the CO2 Business and the Weald Basin. As a result of this review, the Company recorded an impairment of $11.3 million in discontinued operations for the year ended June 30, 2016, to adjust the carrying values of the exchanged assets and liabilities of the CO2 Business to their estimated fair values less costs to sell at June 30, 2016. For the fiscal year ended June 30, 2015, the Company had previously recorded an impairment of $17.4 million related to the proved oil and gas property and a goodwill impairment of $674 thousand related to the CO2 Business. The carrying values of the Weald Basin assets were less than their fair values; therefore, no adjustment was necessary. The adjusted carrying amounts of the major classes of assets and liabilities included in discontinued operations are as follows:
Note Payable. The note payable included in liabilities held for sale of discontinued operations at June 30, 2016, and June 30, 2015, represents the Term Loan with WTSB as described below. On September 17, 2014, the Company, through its former wholly owned subsidiary NP, entered into a senior secured revolving loan facility (the "Revolving Loan Facility") with WTSB. The Revolving Loan Facility had a floating interest rate based on the prime rate with a floor rate of 3.25%, with interest payable quarterly, a maturity of September 30, 2015, and a total available borrowing limit of $8.0 million, of which $5.5 million was drawn as of June 30, 2015, when the Company entered into an amendment to the Revolving Loan Facility whereby the Revolving Loan Facility was converted into a single term loan (the "Term Loan"). The maturity of the Term Loan was extended to June 30, 2020 and bears interest at the Prime Rate (3.5% at June 30, 2016) plus 1.50% with an interest rate floor of 4.75%. The Term Loan was secured by substantially all of NP's assets and a guarantee of Magellan secured by a pledge of its membership interest in NP. During the first 12 months of the Term Loan, only monthly interest payments were payable. Principal is amortized over its remaining four-year term. Under the terms of the Term Loan, Magellan and NP are subject to certain restrictive covenants customary in similar loan agreements. At June 30, 2016, the Company was in compliance with all such covenants. Upon closing of the Exchange on August 1, 2016, Magellan was released from the guarantee and One Stone received 100% of the outstanding membership interests in NP and assumed the Term Loan. Asset Retirement Obligations. The estimated valuation of asset retirement obligations ("AROs") is based on the Company's historical experience and management's best estimate of plugging and abandonment costs by field. Assumptions and judgments made by management when assessing an ARO include: (i) the existence of a legal obligation; (ii) estimated probabilities, amounts, and timing of settlements; (iii) the credit-adjusted risk-free rate to be used; and (iv) inflation rates. Accretion expense related to the asset retirement obligations are included in discontinued operations in the accompanying consolidated statements of operations. The following table summarizes the asset retirement obligation activity included in liabilities held for sale for the fiscal years ended:
Contingent Production Payments.The Company has retained potential future contingent production payments related to its September 2011 acquisition of NP. The contingent production payments are payable, up to a total of $5.0 million, if certain increased average daily production rates are achieved at the Poplar field. Based upon the latest reserves estimates available to the Company, the contingent production payments are unlikely to be paid, and therefore are not recorded in the accompanying consolidated financial statements. Non-controlling Interest in Utah CO2 LLC. The Exchange Agreement provided for the transfer by the Company of its 51% interest in Utah CO2 to One Stone. The non-controlling interest in Utah CO2 has been included with liabilities held for sale in the consolidated balance sheets for all periods presented, and its results of operations are included in discontinued operations in the accompanying statements of operations for all periods presented. |
Sale of Amadeus Basin Assets |
12 Months Ended |
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Jun. 30, 2016 | |
Extractive Industries [Abstract] | |
Sale of Amadeus Basin Assets | Note 3 - Sale of Weald Basin Assets On June 10, 2016, MPUK entered into three concurrent agreements, which resulted in the disposal of its interests in four licenses in the UK and the settlement of all legal claims related to its dispute with Celtique. On June 10, 2016, MPUK entered into i) an Asset Transfer Agreement relating to the sale to UK Oil & Gas Investments PLC ("UKOG") of MPUK's 50% interests in PEDLs 231, 234, and 243 (the "Weald ATA"), ii) an Asset Transfer Agreement relating to the sale to UKOG of MPUK's 22.5% interest in the Offshore Petroleum Licence P1916 (the "IoW ATA"), and iii) a Settlement Agreement with Celtique. The consideration payable by UKOG to MPUK for the Weald ATA amounted to GBP 1.8 million in a combination of cash and shares in UKOG. The number and value of shares of UKOG was determined as of the time of execution of the Weald ATA and was based on the volume weighted average price of an ordinary share of UKOG for the ten business days prior to June 10, 2016. The consideration for the IoW ATA was the assumption of MPUK's outstanding payables related to its interests in the Offshore Petroleum Licence P1916. Pursuant to the terms of the Settlement Agreement, MPUK was due to pay Celtique GBP 500 thousand in a combination of cash and shares in UKOG pro rata to the consideration payable to MPUK for the Weald ATA. The closing of the Weald ATA was subject to customary conditions and the approval by the UK Oil and Gas Authority of, amongst other things, an extension of the term of PEDL 234. The closing of the transactions contemplated by the Weald ATA, IoW ATA, and Settlement Agreement were conditional upon each other and also subject to the completion of the acquisition by UKOG of the entire issued share capital in Celtique, the terms of which acquisition were based on consideration equivalent to that in the Weald ATA. Contemporaneously with these transactions, MPUK and Celtique initiated the process of relinquishing their interests in PEDLs 231 and 243. With respect to the Settlement Agreement, MPUK entered into a settlement agreement with Celtique and its parent Celtique Energie Petroleum Limited (the "Settlement Agreement") which provided for the dismissal of all claims and counterclaims related to PEDLs 231, 234, and 243 between the parties. The Settlement Agreement also included a standstill provision among all parties until the completion of the Weald ATA. On August 11, 2016, the conditions to closing the transactions contemplated by the Weald ATA were met, and the transactions contemplated by all three agreements closed, with MPUK receiving net cash proceeds of GBP 446 thousand and the net issuance to MPUK of approximately 50.9 million shares of UKOG, which shares were worth approximately GBP 703 thousand and GBP 958 thousand as of August 11, 2016, and September 9, 2016, respectively. In connection with the Weald ATA, IoW ATA, and Settlement Agreement, the Company accrued its liabilities to Celtique to the full amount of the consideration payable to Celtique of GBP 500 thousand as of June 30, 2016, and classified its assets and liabilities related to PEDLs 231, 234, and 243, and P1916 to held for sale in the accompanying consolidated balance sheets as of June 30, 2016 and June 30, 2015. The Company also classified the operations related to these licenses to discontinued operations for the years ended June 30, 2016 and 2015. For further information, refer to Note 4 - Discontinued Operations. Note 5 - Sale of Amadeus Basin Assets On March 31, 2014 (the "Central Closing Date"), pursuant to the Share Sale and Purchase Deed dated February 17, 2014 (the "Sale Deed"), the Company sold its Amadeus Basin assets and the Palm Valley and Dingo gas fields ("Palm Valley" and "Dingo," respectively) to Central through the sale of the Company's wholly owned subsidiary, Magellan Petroleum (N.T.) Pty. Ltd ("MPNT"), to Central's wholly owned subsidiary Central Petroleum PV Pty. Ltd ("Central PV"). In exchange for the assets, Central paid to Magellan (i) AUD $20.0 million; (ii) customary purchase price adjustments amounting to AUD $800 thousand; and (iii) 39.5 million newly issued shares of Central stock (ASX: CTP), equivalent to an ownership interest in Central of approximately 11%. The Sale Deed also provides that the Company is entitled to receive 25% of the revenues generated at the Palm Valley gas field from gas sales when the volume-weighted gas price realized at Palm Valley exceeds AUD $5.00/Gigajoule ("GJ") and AUD $6.00/GJ for the first 10 years following the Central Closing Date, and for the following five years, respectively, with such prices to be escalated in accordance with the Australian consumer price index. Between the third and fifth anniversaries of the Central Closing Date, inclusive, the Company may seek from Central a one-time payment (the "Bonus Discharge Amount") corresponding to the present value, assuming an annual discount rate of 10%, of any expected remaining bonus payments in exchange for foregoing future bonus payments. If the Company receives the Bonus Discharge Amount, bonus payments and the Bonus Discharge Amount together may not exceed AUD $7.0 million. The Company also retained its rights to receive any and all bonuses (the "Mereenie Bonus") payable by Santos Ltd ("Santos") and contingent upon production at the Mereenie oil and gas field achieving certain threshold levels. The Mereenie Bonus was established in fiscal year 2011 pursuant to the terms of the asset swap agreement between the Company and Santos for the sale of the Company's interest in Mereenie to Santos and the Company's purchase of the interests of Santos in the Palm Valley and Dingo gas fields. The Company has historically not recognized a contingent asset related to the Bonus Discharge Amount or Mereenie Bonus, as such amounts are not reasonably assured. On May 18, 2016, pursuant to a sale and purchase deed and deed of consent, with appropriate consent from Santos, the Company sold its rights in the Mereenie Bonus for AUD $3.5 million, which translated to $2.5 million on that date. Since no asset had previously been recorded related to the Mereenie Bonus, the Company recorded the entire sales price as a gain for the year ended June 30, 2016. The Company’s ability to repatriate the proceeds from the sale of the Mereenie Bonus to the US was constrained by the terms of the Pledge Agreement the Company entered into in conjunction with the Note with One Stone, until closing of the Exchange on August 1, 2016. |
Securities Available-for-Sale |
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Investments, Debt and Equity Securities [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Securities Available-for-Sale | Note 6 - Securities Available-for-Sale The following table presents the amortized cost, gross unrealized gains, gross unrealized losses and fair market value of available-for-sale equity securities as follows:
During the year ended June 30, 2016, the Company sold part of its investment in Central due to the Company's liquidity constraints and financing needs. The realized price at which the Company sold shares of its investment in Central was lower than the Company's amortized cost, on a per share basis, of its investment. Consequently, the Company determined that unrealized losses incurred through June 30, 2015, related to its investment in Central were other-than-temporary, and recognized an impairment loss in the amount of $14.9 million as of June 30, 2015, equal to the difference between the carrying value of its investment in Central and the market price of Central's common stock on the Australian Securities Exchange at June 30, 2015, including applicable foreign currency translation. On April 15, 2016, pursuant to the Exchange Agreement, Magellan and One Stone entered into a Secured Promissory Note pursuant to which One Stone made a loan to Magellan in the aggregate amount of $625 thousand and simultaneously entered into a Pledge Agreement pursuant to which Magellan pledged, assigned and granted to One Stone a security interest in Magellan's interests in MPA, which in turn holds the Company's available-for sale securities, as collateral for the Note. Upon the closing of the Exchange, the Loan Amount was deemed paid in full as a portion of the exchange consideration, which restored the ability of the Company to sell its shares of Central common stock. On June 10, 2016, pursuant to the Weald ATA, Magellan agreed to accept as partial consideration for the transfer of PEDLs 231, 234, and 243 to UKOG, shares of UKOG, the number of which was determined based upon the volume weighted average price of an ordinary share of UKOG over the 10 business days prior to the signing of the Weald ATA. The closing of the transactions contemplated by the Weald ATA occurred on August 11, 2016, and the value of shares of UKOG received by the Company was approximately GBP 703 thousand at the time of closing. Since Magellan's receipt of the shares of UKOG was not due until closing of the transactions contemplated by the Weald ATA, and since the fair value of the net assets transferred in the Weald ATA was less than the consideration received, no adjustment has been recorded in these consolidated financial statements for any difference in the value of such shares from the time of signing of the Weald ATA and June 30, 2016. Also, during the year ended June 30, 2015, the Company realized a loss on the sale of its other investment in securities available-for-sale in the amount of $171 thousand. |
Notes Payable |
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Jun. 30, 2016 | ||||||||||||||||||||||||||||||||||||
Debt Disclosure [Abstract] | ||||||||||||||||||||||||||||||||||||
Debt | Note 7 - Notes Payable Insurance Premium Notes. Between September 2015 and March 2016, the Company entered into three separate insurance premium financing agreements (the "Premium Notes") to finance the insurance premiums related to the annual renewal of the Company's insurance policies. The Premium Notes have an aggregate original principal amount of $353 thousand, bear interest ranging between 6.25% and 6.50%, and have amortization terms ranging from nine to ten months. The aggregate principal and interest payments due monthly under the Premium Notes range between $38 thousand and $21 thousand, and are payable between July 2016 and January 2017. Secured Promissory Note. Pursuant to the Exchange Agreement, on April 15, 2016, Magellan and One Stone i) entered into a Secured Promissory Note (the “Note”) pursuant to which One Stone made a loan to Magellan in the aggregate amount of $625 thousand (the “Loan Amount”) and ii) simultaneously entered into a Pledge Agreement pursuant to which Magellan pledged, assigned and granted to One Stone a security interest in the Company’s interests in MPA, as collateral for the loan. Magellan was required to use the borrowed amounts to satisfy transaction costs and pay certain outstanding accounts payable primarily related to the CO2 Business, to maintain its ongoing operations between signing of the Exchange Agreement and closing. The Note did not bear interest up until closing of the Exchange and was expected to be forgiven upon closing of the Exchange, and if the Exchange had not closed, would have become due and payable on August 1, 2016, or, in the case of a breach of the Exchange Agreement by One Stone, August 1, 2017, and would have borne interest from the date of termination of the Exchange Agreement at a rate of the prime rate of interest plus 1% (4.5% at June 30, 2016). The Note is included in Notes Payable at June 30, 2016 in the accompanying consolidated balance sheets. Upon the closing of the Exchange on August 1, 2016, the Loan Amount was deemed paid in full and no further amounts under the Note are required to be repaid by the Company. Scheduled annual principal payments of Notes Payable are as follows:
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Asset Retirement Obligations |
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Jun. 30, 2016 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Asset Retirement Obligation Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Asset Retirement Obligations | Note 8 - Asset Retirement Obligations As of June 30, 2016, the Company no longer had an asset retirement obligation related to its oil and gas properties included in continuing operations. The estimated valuation of asset retirement obligations ("AROs") is based on the Company's historical experience and management's best estimate of plugging and abandonment costs by field. Assumptions and judgments made by management when assessing an ARO include: (i) the existence of a legal obligation; (ii) estimated probabilities, amounts, and timing of settlements; (iii) the credit-adjusted risk-free rate to be used; and (iv) inflation rates. Accretion expense is recorded under depletion, depreciation, amortization, and accretion in the consolidated statements of operations. If the recorded value of ARO requires revision, the revision is recorded to both the ARO and the asset retirement capitalized cost. As of June 30, 2016, the Horse Hill-1 well was still under investigation and therefore no ARO was recorded in relation to this potential wellbore in the accompanying consolidated financial statements. The following table summarizes the asset retirement obligation activity for the fiscal years ended:
(1) In fiscal 2015, the Company sold its 40% interest in PEDL 126, the exploration license that contains the Markwells Wood-1 wellbore. By selling the license and the wellbore, the Company was able to eliminate its current asset retirement obligation related to the wellbore. |
Fair Value Measurements |
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Fair Value Disclosures [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Fair Value Measurements | Note 9 - Fair Value Measurements The Company follows authoritative guidance related to fair value measurement and disclosure, which establishes a three level valuation hierarchy for disclosure of fair value measurements. The valuation hierarchy categorizes assets and liabilities measured at fair value into one of three different levels depending on the observability of the inputs employed in the measurement using market participant assumptions at the measurement date. A financial instrument's categorization within the valuation hierarchy is based upon the lowest level of input that is significant to the fair value measurement. The three levels are defined as follows:
The Company's assessment of the significance of a particular input to the fair value measurement in its entirety requires judgment and the consideration of factors specific to the asset or liability. The Company's policy is to recognize transfers in or out of a fair value hierarchy as of the end of the reporting period for which the event or change in circumstances caused the transfer. The Company has consistently applied the valuation techniques discussed above for all periods presented. During the years ended June 30, 2016, and 2015, there have been no transfers in or out of Level 1, Level 2, or Level 3. Assets and liabilities measured on a recurring basis The Company's financial instruments exposed to concentrations of credit risk primarily consist of cash and cash equivalents and accounts receivable. The carrying values for cash and cash equivalents, accounts receivable, accounts payable, accrued liabilities and current portion of notes payable reflect theses items' cost, which approximates fair value based on the timing of the anticipated cash flows and current market conditions. Items required to be measured at fair value on a recurring basis by the Company include securities available-for-sale and contingent consideration payable (as discussed further below). Within the valuation hierarchy, the Company measures the fair value of securities available-for-sale using Level 1 inputs, and the fair value of contingent consideration payable using Level 3 inputs. As of June 30, 2016, and June 30, 2015, the fair value of securities available-for-sale was $601 thousand and $4.2 million, respectively. As of both June 30, 2016, and June 30, 2015, the fair value of contingent consideration payable was $0. The following table presents items required to be measured at fair value on a recurring basis by the level in which they are classified within the valuation hierarchy as of the periods presented:
The contingent consideration payable as discussed in Note 16 - Commitments and Contingencies - Contingent production payments is a potential standalone liability that is measured at fair value on a recurring basis for which there is no available quoted market price, principal market, or market participants. The inputs for this instrument are unobservable and therefore classified as Level 3 inputs. The calculation of this liability is a significant management estimate and uses drilling and production projections based in part on the Company's reserve report for NP to estimate future production bonus payments and a discount rate that is reflective of the Company's credit-adjusted borrowing rate. The Company has retained potential future contingent production payments related to its September 2011 acquisition of NP following the closing of the Exchange with One Stone. Inputs are reviewed by management on an annual basis or more frequently as deemed appropriate, and the potential liability is estimated by converting estimated future production bonus payments to a single net present value using a discounted cash flow model. Payments of future production bonuses are sensitive to the Poplar field's 60 days rolling gross production average. The contingent consideration payable would increase with significant production increases and/or a reduction in the discount rate. The Company has previously recorded a liability and resulting accretion expense for the estimated fair value of the contingent consideration payable. Based upon the latest reserves estimates available to the Company, the contingent consideration payable is unlikely to be paid, and therefore, it is not recorded in the accompanying consolidated financial statements at June 30, 2016. Revisions to the fair value estimate of the contingent consideration payable are recorded in the consolidated statements of operations under other income (expense). The Company undertook a review of its planned drilling program at Poplar with respect to its proved undeveloped reserves as of June 30, 2015, and determined, in light of the then current oil price environment and liquidity situation, to defer this drilling program for an indefinite period. Without this drilling program and the production volumes anticipated therefrom, conditions for the payment of the contingent consideration are unlikely to be met in the foreseeable future. As such, the Company reversed the contingent consideration payable in its entirety as of June 30, 2015 in the accompanying consolidated financial statements. The following table presents information about significant unobservable inputs to the contingent consideration payable measured at fair value on a recurring basis for the fiscal years ended:
The following table presents a roll forward of the contingent consideration payable for the fiscal years ended:
Assets and liabilities measured on a nonrecurring basis Effective March 31, 2016, in connection with the Exchange Agreement and related classification of the assets and liabilities of the CO2 Business to held for sale, the Company reviewed the recoverability of the carrying values of its assets and liabilities to be transferred to One Stone in the Exchange, and as a result of this review recorded an impairment of $11.3 million to adjust the carrying values of the exchanged assets and liabilities to their estimated fair values at March 31, 2016. The inputs used to determine such fair values were based in part on a fairness opinion provided by a third party in connection with the Exchange and in part on internally developed cash flow models and are classified within Level 3 in the hierarchy. The impairment recorded consisted of an amount identifiable to proved oil and gas properties of $7.8 million, an amount identifiable to accounts receivable of $100 thousand, and the remainder to wells in progress of $3.4 million. As of June 30, 2016, the properties continue to be included in assets held for sale at their adjusted carrying values representing their fair values less costs to sell, which as of June 30, 2016, approximately equaled the fair values less costs to sell as determined at March 31, 2016. The Company, in connection with the reclassification of the Weald Basin exploration licenses as held for sale, also reviewed the recoverability of those assets at June 30, 2016, and determined that since the purchase price per the Weald ATA and IoW ATA was greater than the carrying values of the assets, the assets and liabilities were properly recorded at the lower of their fair values, less the cost to sell at June 30, 2016. The Company also utilizes fair value to perform an impairment test on its oil and gas properties and goodwill annually, or whenever events and circumstances indicate that a decline in the recoverability of their carrying values may have occurred. Fair value is estimated using expected discounted future cash flows from oil and gas properties. The inputs used to determine such fair value are primarily based upon internally developed cash flow models and are also classified within Level 3. At June 30, 2016, since the oil and gas properties were adjusted to their fair values and classified as held for sale at March 31, 2016, the date they were reclassified to held for sale, the Company did not perform an additional impairment analysis. The properties continue to be included in assets held for sale at their adjusted carrying values representing their fair values less costs to sell, which as of June 30, 2016, approximately equaled the fair values less costs to sell as determined at March 31, 2016. For the fiscal year ended June 30, 2015, the Company reviewed its proved oil and gas properties and its recorded goodwill for a possible impairment as a result of the recent decline in oil prices and the quantity of reserves due to revisions related to the exclusion of the PUD reserve estimates, and concluded that an impairment allowance of $17.4 million was required to adjust the carrying value of its proved oil and gas properties to fair value and an impairment allowance of $674 thousand was required to adjust the carrying value of its goodwill at Nautilus Poplar to fair value. The qualitative factors used in our assessment include macroeconomic conditions, industry and market conditions, cost factors, and overall financial performance. The quantitative analysis performed included a review of the June 30, 2015 reserve estimates using forward commodity prices and an estimate of the differential less the liabilities for NP, and comparing the result of the analysis to the recorded carrying value of the net assets. The analysis indicated that the carrying value of the net assets exceeded the calculated value of the reserves net of liabilities, and therefore, an impairment had occurred. For the years ended June 30, 2016 and 2015, the impairment of proved oil and gas properties and of goodwill are recorded in discontinued operations, as they relate to the assets of NP held for sale. See Note 4 - Discontinued Operations. |
Income Taxes |
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Income Tax Disclosure [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Income Taxes | Note 10 - Income Taxes The domestic and foreign components of our income (loss) from continuing operations are as follows for the fiscal years ended:
The following reconciles the Company's effective tax rate from continuing operations to the federal statutory tax rate for the fiscal years ended:
The following summarizes components of our income tax provision for the fiscal years ended:
Significant components of the Company's deferred tax assets and liabilities of continuing operations can be summarized as follows for the fiscal years ended:
For the fiscal year ended June 30, 2016, the valuation allowance from continuing operations decreased by $1.2 million, primarily due to stock compensation forfeitures and the appreciation of the dollar reducing the value of the Australian and UK based deferred tax assets. Subsequent to June 30, 2016, the Company exchanged the domestic oil and gas assets (see Note 2 - One Stone Exchange) and sold the central Weald assets held by MPUK (see Note 3 - Sale of Weald Basin Assets), which are reported on the accompanying consolidated balance sheets as assets held for sale and the operations related to these assets are reported as discontinued operations in the accompanying statements of operations (see Note 4 - Discontinued Operations). Certain tax attributes will be subject to a limitation as a result of the consummation of the merger with Tellurian entered into subsequent to June 30, 2016, and expected to close in the fourth calendar quarter of 2016, which merger would constitute a change of ownership as defined under Internal Revenue Code Section 382. The US gross deferred tax assets and liabilities from continuing operations as of June 30, 2016, and 2015, respectively, consist primarily of foreign tax credits and stock options. The US gross deferred tax asset related to property, plant and equipment is primarily related to the discontinued operations exchanged subsequent to June 30, 2016. The Australian deferred tax assets and liabilities as of June 30, 2016 consist primarily of capital loss and net operating loss carry forwards. The Australian capital loss and net operating losses are carried forward indefinitely. The UK deferred tax assets and liabilities as of June 30, 2016, and 2015, respectively, consist primarily of capital allowance carry forwards which are carried forward indefinitely. During fiscal year 2015, the Company made a determination that it was no longer permanently invested in its foreign subsidiaries. As of June 30, 2016, the Company has estimated that it has an overall deferred tax asset of $7.0 million, net of a deferred tax liability related to the basis difference in its foreign subsidiaries of $11.6 million. The Company has $22.2 million of net operating loss carryovers for federal income tax purposes as of June 30, 2016, of which $252 thousand is not benefited for financial statement purposes as it relates to tax deductions that deviate from compensation expense for financial statement purposes. The benefit of these excess tax deductions will not be recognized for financial statement purposes until the related deductions reduce taxes payable. After reviewing all positive and negative evidence, a valuation allowance is recorded against all the net deferred tax assets in the US, Australia and the UK. As a result, the Company has recorded no deferred tax assets as of June 30, 2016, and there are no tax attributes included in assets held for sale or discontinued operations. As of June 30, 2016, the Company remains subject to examination in the following major tax jurisdictions for the tax years indicated below:
At June 30, 2016, the Company had net operating loss and foreign tax credit carry forwards for US federal and state income tax purposes, respectively, which are scheduled to expire periodically as follows:
There are no uncertain tax positions that would meet the more-likely-than-not recognition threshold for the fiscal years ended June 30, 2016, or 2015. |
Stock Based Compensation |
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Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Stock Based Compensation | Note 11 - Stock-Based Compensation The 2012 Stock Incentive Plan On January 16, 2013, the Company's shareholders approved the Magellan Petroleum Corporation 2012 Omnibus Incentive Compensation Plan (the "2012 Stock Incentive Plan"). The 2012 Stock Incentive Plan replaced the Company's 1998 Stock Incentive Plan (the "1998 Stock Plan"). The 2012 Stock Incentive Plan provides for the granting of stock options, stock appreciation rights, restricted stock and/or restricted stock units, performance shares and/or performance units, incentive awards, cash awards, and other stock-based awards to selected employees, including officers, directors, and consultants of the Company (or subsidiaries of the Company). The stated maximum number of shares of the Company's common stock authorized for awards under the 2012 Stock Incentive Plan is 625,000 shares plus the remaining number of shares under the 1998 Stock Plan immediately before the effective date of the 2012 Stock Incentive Plan, which was 36,054 as of January 15, 2013. The number of aggregate shares available for issuance will be reduced by one share for each share granted in the form of a stock option or stock appreciation right and two shares for each share granted in the form of any award that is not a stock option or stock appreciation right that is settled in stock. The maximum aggregate annual number of common shares or options that may be granted to one participant is 125,000, and the maximum annual number of performance shares, performance units, restricted stock, or restricted stock units that may be granted to any one participant is 62,500. The maximum term of the 2012 Stock Incentive Plan is ten years. During the year ended June 30, 2016, 229,947 stock options previously granted under the 1998 Stock Plan expired without exercise. Pursuant to the terms of the 2012 Stock Incentive Plan, the unissued shares underlying these unexercised options were added to the shares available for issuance under the 2012 Stock Incentive Plan. In October 2014, the Company repurchased 189,062 options from a former executive, which options were previously granted under the Company's 1998 Stock Plan. Pursuant to the terms of the 2012 Stock Incentive Plan, the unissued shares underlying these unexercised options were added to the shares available for issuance under the 2012 Stock Incentive Plan. As of June 30, 2016, 306,481 shares, including forfeited or canceled grants, remained available for issuance under the 2012 Stock Incentive Plan. Stock Option Grants Under the 2012 Stock Incentive Plan, stock option grants may contain vesting provisions such that they are TBOs, PBOs, or MBOs. During the fiscal year ended June 30, 2016, the Company granted no stock options. During the fiscal year ended June 30, 2015, the Company granted 16,875 TBOs, 156,250 PBOs and 49,998 MBOs to executives and employees. Performance targets that trigger the vesting of the 156,250 PBOs granted in October 2014 include: (i) procuring a commercially viable commitment for the supply of CO2 to a full-field CO2-EOR development at Poplar at or below a certain price threshold (weighted 20%); (ii) preparing Poplar for a commercially viable CO2-EOR development (weighted 40%); (iii) progressing the Company's UK operations by participation in a well in the Weald Basin (weighted 20%); and (iv) moving forward with the Farnham Dome project by both exercising one of the options related to the purchase of CO2 at Farnham Dome and identifying an applicable oil project to utilize CO2 from Farnham Dome (weighted 20%). The determination of whether any of these performance targets has been met is subject to a determination of the Board. As of June 30, 2016, no performance targets had been met. The 49,998 MBOs granted in October 2014 will vest and become exercisable, subject to certain provisions related to ongoing employment and a three-year vesting period, if, at the end of any period of 90 trading days (a “Window”), (A) the closing price of the common stock as reported by NASDAQ (the “Closing Price”) on each of the first 10 trading days of a Window equals or exceeds $40.00 per share; and (B) the median of the Closing Prices for the common stock during such Window equals or exceeds $40.00 per share. Performance metrics used to measure the potential vesting of the PBOs granted in October 2013 consist of: (i) completing the drilling of the CO2-EOR pilot program at Poplar (weighted 10%); (ii) Board approval of a full field CO2-EOR development project at Poplar (weighted 40%); (iii) sale of substantially all of the Amadeus Basin assets (weighted 20%); (iv) approval of a farmout agreement or the ability to participate in drilling one well in the Weald Basin with internally developed funding, including proceeds from a sale of assets (weighted 20%); and (v) approval and execution of a farmout agreement for drilling one well in the Bonaparte Basin (weighted 10%). As of June 30, 2016, performance metrics (i), (iii) and (iv) had been met. Potential vesting of the market-based stock options granted in October 2013 is subject to the Company maintaining a $18.80 per share closing price for 10 consecutive trading days and median stock price of $18.80 over a period of 90 days. Refer to Note 20 - Subsequent Events for discussion of the acceleration of vesting of the Company's PBOs and MBOs upon closing of the Exchange on August 1, 2016. During the year ended June 30, 2016, no stock options were exercised. During the prior year, 61,849 stock options were exercised, resulting in the issuance of 34,112 shares of common stock, which number is net of shares withheld to satisfy certain employee tax and exercise price obligations. During the year ended June 30, 2016, 13,958 stock options were forfeited. During the prior year, 427,969 stock options were canceled or forfeited, including 189,062 options repurchased from a former executive (see Cancellations, below). During the year ended June 30, 2016, 291,403 stock options expired without exercise. During the prior year period, 12,499 stock options expired. As of June 30, 2016, a total of 332,028 MBOs and PBOs had not vested. During the fiscal year ended June 30, 2016, no options were issued outside of the 2012 Stock Incentive Plan. Options outstanding have expiration dates ranging from December 31, 2016, to January 12, 2025. The following table summarizes the stock option activity for the fiscal years ended:
(1) Weighted average exercise price per share. The total fair value of stock options vesting during the fiscal years ended June 30, 2016, and 2015, was $32 thousand, and $132 thousand, respectively. During the fiscal year ended June 30, 2016, no stock options were exercised. During the fiscal year ended June 30, 2015, 61,849 stock options were exercised for 34,112 shares of common stock, net of shares withheld to satisfy employee tax withholding obligations. Cash received from the exercise of stock options for the fiscal years ended June 30, 2016, and 2015, respectively, was $0, and $115 thousand. The following table summarizes options outstanding and exercisable as of June 30, 2016:
(1) Weighted average exercise price per share. The fair value of shares issued under the 2012 Stock Incentive Plan were estimated using the following weighted-average assumptions for the fiscal years ended:
(1) The terms related to these PBOs were estimated using an average probabilistic weighted method. (2) The Company assumed MBOs will be voluntarily exercised at the midpoint of vesting and the contractual term. Stock Compensation Expense The Company recorded $701 thousand and $891 thousand of stock compensation expense for the fiscal years ended June 30, 2016, and 2015, respectively. The $701 thousand of stock compensation expense for the year ended June 30, 2016 consisted of expense amortization of $742 thousand, partially offset by forfeitures as described below. Stock-based compensation is included under general and administrative expense in the consolidated statements of operations. At June 30, 2016, there was a total of $275 thousand in unrecognized stock compensation expense related to stock options granted. Under normal vesting and amortization and as of June 30, 2016, this cost would be expected to be recognized over a weighted-average period of 1.4 years, and during the fiscal year ending June 30, 2017, it would be expected that an additional 7,292 time-based stock options would become fully vested, and certain performance-based options would additionally vest. However, upon closing of the Exchange with One Stone on August 1, 2016, due to acceleration of vesting provisions, the vast majority of remaining stock options, including all of the PBOs and MBOs, became fully vested and the remaining unamortized, unrecognized expense related to them was recognized. See Note 20 - Subsequent Events, One Stone Exchange. The amount of unrecognized compensation expense noted above and as described in Note 20 does not necessarily represent the amount that will ultimately be realized by the Company in its consolidated statement of operations for the year ending June 30, 2017. Stock Awards The Company's director compensation policy is designed to provide the Company's non-employee directors with a portion of their annual base Board service compensation in the form of equity with a value equal to $35 thousand, with the determination of the exact number of shares to be made on July 1st, or on the date of the subsequent annual stockholders' meeting (the "Stock Award"). In either case, the number of shares to be awarded is determined using the fair value of the shares as of July 1. In addition, there is an annual cash award alternative to the annual Stock Award whereby a non-employee director may elect to receive $35 thousand in cash to exercise previously awarded options to acquire common stock, the exercise price of which is at least equal in value to the common stock eligible for receipt by the director pursuant to the Stock Award (with the difference in value of the options and $35 thousand to be paid in cash, referred to as the Make-Up Payment). On July 3, 2015, the Special Committee determined that the directors' annual stock award would be deferred and revisited in a few months after the strategic alternatives review process had advanced further and liquidity issues had been addressed. As of June 30, 2016, the Company had not made the Stock Award payment that is to be determined as of July 1, but has accrued a total of $175 thousand, representing the $35 thousand equity value of the Stock Award to each non-employee director. For further discussion of this award, refer to Note 20 - Subsequent Events. On July 1, 2014, the Company issued a total of 12,041 shares of its common stock to non-employee directors and one board observer pursuant to this policy and the 2012 Stock Incentive Plan. Pursuant to the compensation policy, one director elected to apply his annual compensation to the exercise of a portion of his previously awarded and vested options in lieu of receiving a share award, resulting in the issuance of an additional 2,734 shares upon exercise. Total compensation expense from the issuance of non-employee director compensation for the year ended June 30, 2015, was $264 thousand. In connection with certain executive promotions effective on October 31, 2014, the Board’s Compensation, Nominating and Governance Committee (the “CNG Committee”) established a new 2015 incentive compensation program that included grants of 12,500 shares of restricted stock in aggregate under the 2012 Stock Incentive Plan to the Company's three senior executives and 6,250 shares of restricted stock under the 2012 Stock Incentive Plan to the Chairman of the Board. Total gross compensation expense from the issuance of restricted stock to executives for the year ended June 30, 2015, prior to forfeitures, was $79 thousand. Forfeitures During the year ended June 30, 2016, 13,958 stock options were forfeited, resulting in the reversal of previously recorded compensation expense of $41 thousand, which was recorded as an offset to general and administrative expense during the year ended June 30, 2016 in the accompanying consolidated statement of operations. During the year ended June 30, 2015, 238,907 unvested stock options and 17,500 unvested shares of restricted stock that were previously granted were forfeited. The forfeiture of unvested options and unvested restricted stock resulted in the reversal of previously recorded compensation expense of $648 thousand and $67 thousand, respectively, which was recorded as an offset to general and administrative expense during the year ended June 30, 2015 in the accompanying consolidated statement of operations. Cancellations On October 10, 2014, Magellan entered into an Options and Stock Purchase Agreement (the "Agreement") with William H. Hastings, a former executive officer and director of the Company and a beneficial owner of more than 5% of the Company’s common stock as of October 10, 2014. The Agreement provided for the repurchase by the Company from Mr. Hastings of 31,250 shares of the Company’s common stock and options to acquire 189,062 shares of the Company’s common stock. The gross proceeds that were paid to Mr. Hastings on October 17, 2014, pursuant to the Agreement totaled $1.4 million (the "Proceeds") and were subject to applicable tax withholdings. Of the Proceeds, $983 thousand related to the repurchase of the options, which amount was subject to applicable withholding tax withheld from and remitted on behalf of the former executive in the amount of $318 thousand. The Company canceled the 189,062 repurchased options and, pursuant to the terms of the 2012 Stock Incentive Plan, added the unissued shares underlying these unexercised options to the shares available for issuance under the 2012 Stock Incentive Plan. Of the Proceeds, the remaining $462 thousand related to the repurchase of the shares of common stock. See Note 13 - Stockholders' (Deficit) Equity for further detail. |
Preferred Stock |
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Equity [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Preferred Stock | Note 12 - Preferred Stock The Company's certificate of incorporation provides for the issuance of up to 50.0 million preferred shares. Pursuant to the Series A Purchase Agreement discussed below, 28.0 million of the total authorized preferred shares was allocated to the Series A Preferred Stock class. One Stone Exchange On March 31, 2016, Magellan and One Stone entered into an Exchange Agreement, as described further in Note 2 - One Stone Exchange. As a result of the execution of and conditions to the Exchange Agreement, the Company analyzed the redemption features of its Series A Preferred Stock and determined that as part of the Exchange, redemption of the Series A Preferred Stock in the near term was probable. The Company reviewed the recoverability of the carrying values of its assets and liabilities to be transferred to One Stone in the Exchange, and as a result of this review recorded an impairment of $11.3 million in discontinued operations for the year ended June 30, 2016, in order to adjust the carrying values of the exchanged assets and liabilities to their estimated fair values less costs to sell (Note 4). The Company then determined that the resultant fair value of the net assets expected to be transferred to redeem the Series A Preferred Stock in the Exchange were less than the carrying value of the Series A Preferred Stock. The Company accordingly adjusted the carrying amount of the Series A Preferred Stock to its original issue value of $23.5 million, reflecting a reduction in value for the year ended June 30, 2016, up to the amount of previously recorded increases in value for accumulated dividends paid-in-kind, such dividends totaling $4.2 million in the aggregate. Subsequent to June 30, 2016, upon closing of the Exchange on August 1, 2016, the Company recorded further adjustments to the fair value of the Series A Preferred Stock resulting from its redemption as a contribution to equity. Refer to Note 20 - Subsequent Events for details. Series A Convertible Preferred Stock Financing On May 10, 2013, the Company entered into a Series A Convertible Preferred Stock Purchase Agreement (the "Series A Purchase Agreement") with One Stone Holdings II LP ("One Stone"), an affiliate of One Stone Energy Partners, L.P. Pursuant to the terms of the Series A Purchase Agreement, on May 17, 2013 (the "Closing Date"), the Company issued to One Stone 19,239,734 shares of Series A Convertible Preferred Stock, par value $0.01 per share (the "Series A Preferred Stock"), at a purchase price of $1.22149381 per share (the "Purchase Price"), for aggregate proceeds of approximately $23.5 million. Subject to certain conditions, the shares of Series A Preferred Stock and any related unpaid accumulated dividends are convertible into shares of the Company's common stock, par value $0.01 per share, using a face amount per share of the Series A Preferred Stock based on the Purchase Price, and dividing by a conversion price of $9.77586545 per share, which conversion price has been adjusted to reflect the one share-for-eight shares reverse split of the Company's common stock effective July 10, 2015. The Series A Purchase Agreement also included the following key terms:
The Company determined that a Change in Control (as defined in the Certificate of Designations) is not solely within the Company's control, and therefore the Series A Preferred Stock is presented in the consolidated balance sheets under temporary equity, outside of permanent equity.
The Series A Purchase Agreement and a related separate Registration Rights Agreement also included the following key terms:
The Company has analyzed the embedded features of the Series A Preferred Stock and has determined that none of the embedded features is required under US GAAP to be bifurcated from the Series A Preferred Stock and accounted for separately as a derivative. The Company recorded the transaction by recognizing the fair value of the Series A Preferred Stock at the time of issuance in the amount of $23.5 million. The Company is required to accrete the Series A Preferred Stock to the redemption value if events or circumstances indicate that redemption is probable. For the fiscal years ended June 30, 2016, and 2015, respectively, the Company recorded preferred stock dividends of $1.9 million and $1.7 million, and accrued dividends in the amount of $0 and $0 related to the Series A Preferred Stock. The preferred stock dividends for the year ended June 30, 2016 were paid in kind. Accordingly, the value of these dividends of $1.9 million was recorded and added to the preferred stock balance on the Company's balance sheet at June 30, 2016. For the fiscal year ended June 30, 2015, the value of dividends paid in kind of $1.3 million was recorded and added to the preferred stock balance on the Company's balance sheet at June 30, 2015. The following table summarizes the Series A Preferred Stock activity for the fiscal years ended:
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Equity [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Stockholders' (Deficit) Equity | Note 13 - Stockholders' (Deficit) Equity Reverse Stock Split On July 10, 2015, pursuant to the Company's definitive proxy statement filed on June 8, 2015, the Company held a Special Meeting of Stockholders to approve an amendment to its Restated Certificate of Incorporation to effect a reverse stock split of its common stock at a ratio to be determined by the Board of Directors within a specific range set forth in the proxy statement, without reducing the number of authorized shares. The Company's shareholders approved the proposed amendment to the Restated Certificate of Incorporation, and the Board of Directors selected a reverse split ratio of one-for-eight (1:8). As a result of the reverse stock split, as of the close of business on July 10, 2015, each eight shares of common stock were converted into one share of common stock with any fractional shares being settled in cash. Immediately preceding the reverse stock split, there were 55,313,647 shares of common stock issued, including 9,675,114 treasury shares. The number of shares of Series A Preferred Stock did not change as a result of the split; however, following the reverse stock split the conversion price was adjusted to reflect the split from $1.22149381 to $9.77586545. After the reverse stock split there were 6,911,921 shares of common stock issued, including 1,209,389 treasury shares. All share and per share amounts relating to the common stock, stock options to purchase common stock, including the respective exercise prices of each such option, and the conversion ratio of the Series A Preferred Stock included in the financial statements and footnotes have been adjusted to reflect the reduced number of shares resulting from the reverse stock split. Market conditions tied to stock price targets contained within MBOs were similarly adjusted. The par value and the number of authorized, but unissued, shares remain unchanged following the reverse stock split. Treasury Stock On September 24, 2012, the Company announced that its Board had approved a stock repurchase program authorizing the Company to repurchase up to a total value of $2.0 million in shares of its common stock. During November 2012, the Company repurchased 18,692 shares pursuant to this program. As of June 30, 2014, $1.9 million in shares of common stock remained authorized for repurchase under this program. This authorization superseded the prior plan announced on December 8, 2000, and expired on August 21, 2014, with no further repurchases of stock. On December 31, 2015, upon the vesting of 7,500 shares of restricted stock previously granted to executives of the Company and pursuant to the tax withholding provisions of the Company's restricted stock award agreements, the Company withheld on a cashless basis 2,398 shares to settle withholding taxes. The withheld shares were immediately canceled. On July 10, 2015, to effect the one share for-eight-shares reverse split of the Company's common stock, the Company paid cash in lieu of issuance of fractional shares totaling 2,284 post-split shares. The shares underlying the payment in lieu of cash were immediately canceled. On July 1, 2015, upon the vesting of 12,500 shares of restricted stock previously granted to executives of the Company and pursuant to the tax withholding provisions of the Company's restricted stock award agreements, the Company withheld on a cashless basis 2,822 shares to settle withholding taxes. The withheld shares were immediately canceled. On October 10, 2014, Magellan repurchased 31,250 shares from William H. Hastings, a former Company executive, pursuant to an Options and Stock Purchase Agreement. See Note 11 - Stock-Based Compensation for further details. On July 1, 2014, upon the vesting of 18,750 shares of restricted stock previously granted to executives of the Company and pursuant to the tax withholding provisions of the Company's restricted stock award agreements, the Company withheld on a cashless basis 5,981 shares to settle withholding taxes. The withheld shares were immediately canceled. On January 14, 2013, the Company entered into a Collateral Purchase Agreement (the "Collateral Agreement") with Sopak AG, a Swiss subsidiary of Glencore International plc ("Sopak"), pursuant to which the Company agreed to purchase: (i) 1,158,080 shares of the Company's common stock, (ii) a warrant granting Sopak the right to purchase from the Company an additional 543,478 shares of common stock, and (iii) a Registration Rights Agreement, dated as of June 29, 2009, and amended as of October 14, 2009, and June 23, 2010, among the Company, Young Energy Prize S.A., a Luxembourg corporation ("YEP"), and ECP Fund, SICAV-FIS, a Luxembourg corporation ("ECP"), which is a subsidiary of Yamalco Investments Limited, a Cyprus company ("Yamalco"), for a purchase price of $10.0 million. The Collateral Agreement was subsequently amended on January 15, 2013, and the transactions contemplated thereby closed on January 16, 2013. The Company accounted for the Collateral Agreement by allocating the purchase price of $10.0 million to the fair value of the warrant, which was estimated at $0.8 million, and the remaining $9.2 million to the purchase of the 1,158,080 shares of common stock, resulting in a value per share of $7.944 for the shares of common stock purchased. YEP, ECP, and Yamalco are entities affiliated with Nikolay V. Bogachev, a former director of the Company. All repurchased common stock shares are currently being held in treasury at cost, including direct issuance cost. The following table summarizes the Company's treasury stock activity for the fiscal years ended:
Retired Warrant The Company formally retired the warrant purchased from Sopak during its fiscal year ended June 30, 2013, pursuant to the Collateral Agreement described above. The fair value of the warrant was estimated using the Black-Scholes-Merton pricing model and determined to be approximately $0.8 million, which was included as a reduction of additional paid in capital. Assumptions used in estimating the fair value of the warrant included: (i) the common stock market price on the repurchase date of $7.20 per share; (ii) the warrant exercise price of $9.20 per share; (iii) an expected dividend of $0; (iv) a risk-free interest rate of 0.2%; (v) a remaining contractual term of 1.5 years; and (vi) an expected volatility based on historical prices of 60.8%. |
Loss Per Share |
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Earnings Per Share [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Loss Per Share | Note 14 - Loss Per Share The following table summarizes the computation of basic and diluted loss per share for the fiscal years ended:
(1) All diluted earnings per share calculations are dictated by the results from continuing operations; accordingly there were no dilutive effects on earnings per share in the periods presented since all such periods had a net loss from continuing operations. There is no dilutive effect on loss per share in periods with net losses from continuing operations. Stock options or shares of common stock issuable upon the conversion of the Series A Preferred Stock were not considered in the calculation of diluted weighted average common shares outstanding, as they would be anti-dilutive. Potentially dilutive securities excluded from the calculation of diluted shares outstanding in fiscal years with net losses from continuing operations are as follows:
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Segment Information |
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Segment Information | Note 15 - Segment Information Following the closing of the Exchange, the Company will conduct its operations through two wholly owned subsidiaries. As of March 31, 2016, NP, which included the Company's operations in the United States, has been reclassified to discontinued operations and the carrying value of its assets have been included in assets held for sale for all periods presented. As of June 30, 2016, the Company's operations related to the central Weald licenses and the peripheral Weald license have also been reclassified to discontinued operations, and the carrying value of the related assets have been included in assets held for sale for all periods presented. As of June 30, 2016, the Company's two reportable segments include MPUK, which includes the Company's continuing operations in the UK; and MPA, which includes the Company's operations in Australia. Oversight for these subsidiaries is provided by Corporate, which is treated as a cost center. The following table presents segment information for the fiscal years ended:
(1) Refer to Note 22 - Supplemental Oil and Gas Information (Unaudited) for disclosures relating to non-cash charges to capitalized costs. (2) Asset inter-segment eliminations are primarily derived from investments in subsidiaries. The following table summarizes other significant items for the fiscal years ended:
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Commitments and Contingencies |
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Commitments and Contingencies Disclosure [Abstract] | |||||||||||||||||||||||||||||||||
Commitments and Contingencies | Note 16 - Commitments and Contingencies Operating leases. The following table summarizes the Company's future minimum rental commitments under non-cancelable operating leases, net of guaranteed sublease income, as of June 30, 2016:
Rent expense, recorded gross of sublease income in the accompanying consolidated statements of operations, for each of the years ended June 30, 2016, and 2015, was $284 thousand and $301 thousand, respectively. Contingent production payments. In September 2011, the Company entered into a Purchase and Sale Agreement (the "Nautilus PSA") among the Company and the non-controlling interest owners of NP for the Company's acquisition of the sellers' interests in NP. The Nautilus PSA provides for potential future contingent production payments, payable by the Company in cash to the sellers, of up to a total of $5.0 million if certain increased average daily production rates for the underlying properties are achieved. J. Thomas Wilson, a director and chief executive officer of the Company until August 5, 2016, has an approximate 52% interest in such contingent payments. See Note 9 - Fair Value Measurements above for information regarding the estimated discounted fair value of the future contingent consideration payable related to the Nautilus PSA. Following the closing of the Exchange, these contingent production payments remain an obligation of Magellan. Based upon the latest reserves estimates available to the Company, the contingent production payments are unlikely to be paid, and therefore, as of June 30, 2016, and 2015, are not recorded in the accompanying consolidated financial statements. Sopak Collateral Agreement. The Company has estimated that there is the potential for a statutory liability of approximately $1.8 million and $1.7 million as of June 30, 2016, and 2015, respectively, related to US federal tax withholdings and related penalties and interest related to the Collateral Agreement described in Note 13 - Stockholders' (Deficit) Equity. As a result, we have recorded a total liability of $1.8 million and $1.7 million as of June 30, 2016, and 2015, respectively, under accrued and other liabilities in the consolidated balance sheets included in this report. The Company has a legally enforceable right to collect from Sopak any amounts owed to the Internal Revenue Service as a result of the Collateral Agreement. As a result, we have recorded a corresponding receivable of $1.8 million and $1.7 million as of June 30, 2016, and 2015, respectively, under prepaid and other assets in the accompanying consolidated balance sheets. Celtique Litigation. On June 10, 2016, MPUK reached a settlement with Celtique of its outstanding claims and counterclaims, whereby in connection with closing the transactions contemplated by the Weald ATA and the IoW ATA, Celtique would receive proceeds from the transfer of the Company's interests in the Central Weald assets of £500 thousand, payable at closing in combination of cash of £179 thousand and shares of stock of UKOG valued at £321 thousand at the time of the agreed settlement (the "Settlement Agreement"). On August 11, 2016, upon closing the transactions contemplated by the Weald ATA and IoW ATA, the claims were settled in accordance with the Settlement Agreement, and the Company has no further obligations to Celtique. NT/P82 Seismic Survey. In June 2016, the Australian Commonwealth-Northern Territory Offshore Petroleum Joint Authority and the National Offshore Petroleum Titles Administrator approved a variation in MPA's work program commitments under the NT/P82 permit in the Bonaparte Basin. The new work program commitment extended the term of the commitment to complete seismic to November 12, 2017, the cost of which commitment is estimated at AUD $9 million. Engagement of RFC Ambrian as financial advisor for farmout of NT/P82. In July 2015, the Company engaged RFC Ambrian as its financial advisor to run a formal bid process for the farm-out of its 100% operating interest in the NT/P82 permit in the Bonaparte Basin, offshore Australia, to fund future exploration costs and recover back-costs incurred. The terms of the engagement include cash payments of $20 thousand and $80 thousand for the two initial stages of the engagement through a written offer, and a success fee upon completion of a legally binding agreement ranging from $250 thousand to 5% of the farm-out value of the agreement to the Company. In addition, on March 10, 2016, the Company extended the scope of RFC Ambrian's mandate to include a potential sale of the Company's rights to certain payments contingent on production thresholds of the Mereenie field in Australia and agreed to pay RFC Ambrian 5% of any consideration the Company may receive in connection with such a transaction. The transaction fees related to the sale of the Mereenie Bonus were paid by the Company in May 2016, concurrent with the closing of the transaction as described in Note 5 - Sale of Amadeus Basin Assets. Petrie Engagement. In June 2015, the Special Committee engaged Petrie Partners, LLC ("Petrie") to act as its financial advisor (the "Petrie Engagement"). Under the terms of the Petrie Engagement, as amended on March 14, 2016, the Company has agreed to pay Petrie certain fees contingent upon the successful closing of certain transactions, together with reimbursement of expenses, as follows: (a) upon rendering of a fairness opinion on the One Stone Exchange, an opinion fee of $300 thousand; (b) upon the successful closing of the Exchange, a divestiture transaction fee of $450 thousand, which amount is net of the opinion fee, and, (c) if the Company enters into a corporate transaction such as business combination transaction, a corporate transaction fee in the aggregate amount of $800 thousand, consisting of $300 thousand to be paid in cash, which amount may be used to pay for a fairness opinion to be provided by Petrie in relation to the corporate transaction, and $500 thousand to be paid in stock of the Company, the number of which shares to be issued to Petrie being determined by the quotient of $500 thousand and the volume weighted average closing price of the Company’s common shares over the 10 trading days ending on the last trading day prior to the announcement of such corporate transaction. The Company paid Petrie $300 thousand on March 31, 2016, in relation to the fairness opinion rendered with respect to the Exchange, $450 thousand in August 2016, following the closing of the Exchange, and $300 thousand on August 2, 2016, in relation to the fairness opinion rendered with respect to the Merger Agreement. Upon closing of the Merger, Magellan will issue approximately 410 thousand shares of its common stock to Petrie as partial consideration of Petrie's success fee. The Petrie Engagement may be terminated by either party with five days' written notice. Poplar CO2-EOR Pilot Bonus. Mi3 Petroleum Engineering ("Mi3") is a Golden, Colorado-based petroleum engineering firm that advises the Company with respect to its CO2-EOR activities, including the Company's CO2-EOR pilot at the Poplar field (see Note 17 - Related Party Transactions). Pursuant to the terms of a master services contract, as amended on November 4, 2015, Mi3 was entitled to a payment in the amount of $100 thousand, contingent upon the completion of a transaction resulting in the sale of the Poplar field to a third party, in addition to a fixed payment for certain services provided. Based upon the terms of the Exchange Agreement, which was entered into between the Company and an affiliate of the Company rather than a third party, upon closing of the Exchange, the contingent payment in the amount of $100 thousand was not due to Mi3. NASDAQ Listing Requirements. On November 5, 2015, Magellan received a letter from the Listing Qualifications Department of the NASDAQ Stock Market ("NASDAQ") indicating that, based upon the closing bid price of the Company's common stock for the last 30 consecutive business days, the common stock had not met the minimum bid price of $1.00 per share required for continued listing on the NASDAQ Capital Market pursuant to NASDAQ Marketplace Rule 5550(a)(2). On March 4, 2016, the Company received a letter from NASDAQ notifying the Company that, since the closing bid price of the common stock for the previous 10 consecutive business days was at least $1.00, the Company had regained compliance with NASDAQ Marketplace Rule 5550(a)(2). On May 17, 2016, Magellan received a letter from the Listing Qualifications Department of the NASDAQ indicating that the Company’s stockholders’ equity as reported in the Company’s quarterly report on Form 10-Q for the period ended March 31, 2016 did not meet the minimum $2.5 million required for continued listing on the NASDAQ Capital Market pursuant to NASDAQ Stock Market Rule 5550(b)(1). On June 30, 2016, the Company submitted materials to NASDAQ describing a number of transactions that it believed would enable it to report stockholders’ equity of approximately $4.1 million on a pro forma basis, as of March 31, 2016, and that it was engaged in negotiations with a specific party to enter into a potential business combination transaction. On July 29, 2016, Magellan received a letter from the Listing Qualifications Department of NASDAQ indicating that it had determined to grant Magellan an extension until October 14, 2016 to regain compliance with Rule 5550(b). In the letter dated July 29, 2016, the Listing Qualifications Department indicated that any future business combination with a non-NASDAQ entity would likely be considered a “change of control” of Magellan, which would require the post-combination company to apply for initial listing on the NASDAQ Capital Market and meet all applicable initial listing criteria. One Stone Exchange Agreement. The Exchange Agreement may be terminated under certain circumstances, including in specified circumstances in connection with receipt of a Superior Proposal, as such term is defined in the Exchange Agreement. In connection with the termination of the Exchange Agreement in the event of a Superior Proposal, a breach by the Company of the non-solicitation provision, or following a change by the Board of its recommendation to stockholders, the Company would have been required to pay to One Stone a termination fee of $750 thousand. If the Exchange Agreement was terminated by either party as a result of the failure to obtain the requisite approval by Magellan stockholders, the Company would have been required to reimburse One Stone for all documented out-of-pocket fees and expenses incurred by One Stone in connection with the Exchange Agreement, subject to a maximum of $200 thousand in the aggregate. Secured Promissory Note and Pledge Agreement. On April 15, 2016, the Company and One Stone entered into a Secured Promissory Note and a Pledge Agreement pursuant to which One Stone made a loan to Magellan in the aggregate amount of $625 thousand. On August 1, 2016, upon the closing of the Exchange, the Loan Amount was deemed paid in full and no further amounts under the Note will be repaid by the Company. |
Related Party Transactions |
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Jun. 30, 2016 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | Note 2 - One Stone Exchange On March 31, 2016, Magellan and One Stone entered into an Exchange Agreement (the “Exchange Agreement”). The Exchange Agreement provides, upon the terms and subject to the conditions set forth in the Exchange Agreement, for the transfer by One Stone to the Company of 100% of the outstanding shares of Magellan Series A convertible preferred stock (the “Series A Preferred Stock”) in consideration for the assignment to and assumption by One Stone of 100% of the outstanding membership interests in Nautilus Poplar LLC and 51% of the outstanding common units in Utah CO2 LLC (“Utah CO2,” and together with Nautilus Poplar LLC, the "CO2 Business"), as adjusted by the Cash Amount (as defined in the Exchange Agreement and discussed further below) (the “Exchange”). The closing of the Exchange was subject to customary closing conditions, including, among others, the receipt of Magellan stockholder approval and the consent of West Texas State Bank ("WTSB") to release a guaranty provided by Magellan. The Exchange Agreement has been approved by each of the Special Committee and the Company’s Board of Directors. Stockholders of the Company were asked to vote on the approval of the Exchange Agreement at a stockholder meeting that took place on July 13, 2016, at which the Exchange Agreement was approved by the stockholders. One Stone was required to vote all shares of Series A Preferred Stock in favor of the Exchange Agreement at the meeting of Magellan stockholders. If the customary closing conditions had not been satisfied, and the Exchange Agreement had been terminated by either party as a result of the failure to obtain the requisite approval by Magellan stockholders, the Company would have been required to reimburse One Stone for all documented out-of-pocket fees and expenses incurred by One Stone in connection with the Exchange Agreement, subject to a maximum of $200 thousand in the aggregate. On August 1, 2016, the transactions contemplated by the Exchange Agreement closed and the Company received the Cash Amount, which amounted to $900 thousand. Pursuant to the Exchange Agreement, on April 15, 2016, Magellan and One Stone i) entered into a Secured Promissory Note (the “Note”) pursuant to which One Stone made a loan to Magellan in the aggregate amount of $625 thousand (the “Loan Amount”) and ii) simultaneously entered into a Pledge Agreement pursuant to which Magellan pledged, assigned and granted to One Stone a security interest in the Company’s interests in MPA, as collateral for the loan. Magellan was required to use the borrowed amounts to satisfy transaction costs and pay certain outstanding accounts payable primarily related to the CO2 Business to maintain its ongoing operations between signing of the Exchange Agreement and closing. The Note did not bear interest up until closing of the Exchange, was expected to be forgiven upon closing of the Exchange, and if the Exchange had not closed, would have become due and payable on August 1, 2016, or, in the case of a breach of the Exchange Agreement by One Stone, August 1, 2017, and would have borne interest from the date of termination of the Exchange Agreement at a rate of the prime rate of interest plus 1% (4.5% at June 30, 2016). At the closing of the Exchange, the Loan Amount was deemed paid in full and no further amounts under the Note are required to be repaid by the Company. The Exchange Agreement has been given economic effect as of September 30, 2015 (the “Effective Date”). At closing, One Stone was expected to pay the Company an amount in cash equal to i) any transaction costs One Stone has agreed to pay pursuant to the Exchange Agreement that have not been paid on or prior to closing, ii) minus (if positive) or plus (if negative) the net revenues and expenses attributable to NP after the Effective Date, plus iii) certain specified liabilities of NP actually paid by the Company or NP prior to closing, minus, (iv) the Loan Amount (the “Cash Amount”). The purpose of the Cash Amount is primarily to reimburse the Company for the funding of the operations of NP during the period between September 30, 2015, and the closing of the Exchange, which operations resulted in a loss in the aggregate for the period. At the end of June 2016, the Company provided a preliminary estimate of the Cash Amount, which amounted to $1.2 million. On August 1, 2016, the final amount agreed between the parties and paid by One Stone to the Company was $900 thousand. In addition, One Stone and Messrs. Gluzman and Israel agreed that the Company would not be required to pay the outstanding fees owed to Messrs. Gluzman and Israel as compensation for services as directors of the Company, which outstanding fees amounted to approximately $174 thousand in a combination of cash and stock of the Company. The Exchange Agreement may have been terminated under certain circumstances, including in specified circumstances in connection with receipt of a Superior Proposal, as such term is defined in the Exchange Agreement. In connection with the termination of the Exchange Agreement in the event of a Superior Proposal, a breach by the Company of the non-solicitation provision, or following a change by the Board of its recommendation to stockholders, in addition to amounts discussed above, the Company would have been required to pay to One Stone a termination fee of $750 thousand. Note 17 - Related Party Transactions Devizes International Consulting Limited. A director of Celtique, with which the Company co-owns equally several licenses in the UK, is also the sole owner of Devizes International Consulting Limited ("Devizes"). Devizes performs consulting services for MPUK. The Company recorded $59 thousand and $147 thousand of consulting fees related to Devizes for the fiscal years ended June 30, 2016, and 2015, respectively. Mervyn Cowie. Mervyn Cowie, a former employee of the Company's MPA subsidiary, currently serves both as a director of MPA and its subsidiaries and as a consultant to MPA. Since December 1, 2014, the recurring monthly fee payable to Mr. Cowie for his consulting services amounts to AUD $5,400. Mi3 Petroleum Engineering. In association with its purchase of an option to acquire CO2 from Farnham Dome, on August 14, 2014, the Company formed a subsidiary, Utah CO2. On December 1, 2014, two other non-controlling interest owners became members of Utah CO2, one of which is Mi4 Oil and Gas, LLC ("Mi4"), a Colorado limited liability company majority owned by Mi3. Mi3 performs ongoing consulting work for both Utah CO2 and other Magellan entities. During the years ended June 30, 2016, and 2015, respectively, the Company recorded $293 thousand and $1.1 million of consolidated expense related to fees payable to Mi3. During the years ended June 30, 2016, and 2015, $293 thousand and $1.1 million, respectively, of the related expense was included in discontinued operations in the accompanying consolidated statement of operations. One Stone Exchange. On March 31, 2016, the Company and its sole preferred stockholder entered into an Exchange Agreement providing for the exchange of 100% of the outstanding shares of Magellan Series A Preferred Stock for the assignment to the preferred stockholder of 100% of the Company's interest in the CO2 Business, subject to certain conditions including Magellan stockholder approval. Refer to Note 2 - One Stone Exchange for further information. |
Employee Retention and Severance Costs |
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Restructuring and Related Activities [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Employee Retention and Severance Costs | Note 18 - Employee Retention and Severance Costs The Company is required to record charges for one-time employee severance benefits and other associated costs as incurred. Incentive Agreements with Chief Financial Officer On October 12, 2015, the Company entered into a series of new incentive compensation agreements with Antoine J. Lafargue, the Company's Chief Financial Officer (the "CFO Incentive Agreements"). The CFO Incentive Agreements include i) amendments to the provisions for severance payments available to the CFO under his existing employment agreement dated October 31, 2014 (pursuant to an amendment of such employment agreement), to include provisions for the payment of up to two years' salary as severance in the event that the CFO’s employment with the Company is terminated under certain circumstances within a period ending ten months after the date on which a qualifying transaction (as generally defined below) occurs, capped at $600 thousand; ii) a restricted stock award agreement whereby a restricted stock grant was made to the CFO on October 12, 2015 totaling 62,500 shares of common stock that are to vest immediately prior to the completion of a qualifying transaction; iii) a potential cash award pursuant to a transaction incentive agreement, which cash award is contingent upon the completion of a qualifying transaction and would range from $0 to $1 million based on the market value of the Company's common stock reflected in the qualifying transaction, with the amount of cash award to be equal to $2,750 for each one cent of market value per share of the Company’s common stock reflected in the qualifying transaction above a minimum market value threshold of $1.60 per share; iv) a phantom stock award, also pursuant to the transaction incentive agreement, with payment contingent upon completion of a qualifying transaction and to be based on the value of 62,500 notional shares; and v) an override bonus agreement which provides for a potential bonus outside of the Company’s 2012 Omnibus Incentive Compensation Plan that would double the amounts payable under the awards available under ii, iii, and iv, above, in certain circumstances. For purposes of the CFO Incentive Agreements, a qualifying transaction is generally defined to mean an acquisition of more than 50% of the combined voting power of the then-outstanding voting securities of the Company entitled to vote generally in the election of directors, or the sale or other disposition of greater than 95% of the value of the gross assets of the Company, in either case occurring prior to December 31, 2017. No accrual has been made in the accompanying consolidated financial statements for the CFO Incentive Agreements as amounts are contingent on the occurrence of future events and service. The Company does not consider the future events to meet the definition of "probable" as of June 30, 2016, due to the nature of the events being contingent upon third parties outside of the Company's control. Employee Retention Cash Bonus Plan On June 5, 2015, the Compensation, Nominating and Governance Committee of the Board of Directors of the Company and the Board of Directors of the Company approved a cash bonus plan for the Company's non-executive officer employees for the purpose of retention of certain key accounting, human resource, and administrative employees through certain key milestone events (the "Employee Retention Cash Bonus Plan"). The terms of the Employee Retention Cash Bonus Plan specify payment of retention bonuses for such employees upon the achievement of the milestones, which are i) the filing of the Company's annual report on Form 10-K for the fiscal year ended June 30, 2015 (which milestone occurred in October 2015), and ii) the completion of a strategic transaction resulting in a change in control or the sale of substantially all the assets of the company. The maximum original bonus payable to the employees under each of the milestones is as follows: i) $168 thousand, and ii) $286 thousand, respectively. As of June 30, 2016, the Company has recorded an accrual in the amount of $425 thousand in the accompanying consolidated financial statements for the Employee Retention Cash Bonus Plan. Severance and Termination Benefit Payments On August 31, 2014, the Company provided a notice of termination to the only remaining employee of its MPA subsidiary. As a result, during the fiscal year ended June 30, 2015, the Company expensed and paid total employee-related severance costs of $475 thousand. A reconciliation of the beginning and ending liability balance for charges to the consolidated statements of operations and cash payments is as follows for the fiscal years ended:
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Accumulated Other Comprehensive Income |
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Accumulated Other Comprehensive Income | Note 19 - Accumulated Other Comprehensive Income The following table represents the changes in components of accumulated other comprehensive income, net of tax, for the fiscal year ended:
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Subsequent Events |
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Jun. 30, 2016 | |
Subsequent Events [Abstract] | |
Subsequent Events | Note 20 - Subsequent Events Merger with Tellurian. On August 2, 2016, Magellan, Tellurian, and Merger Sub, a Delaware corporation and a direct wholly owned subsidiary of Magellan, entered into the Merger Agreement. Pursuant to the Merger Agreement, each outstanding share of common stock, par value $0.001 per share, of Tellurian will be exchanged for 1.300 shares of common stock, par value $0.01 per share, of Magellan, and Merger Sub will merge with and into Tellurian (the “Merger”), with Tellurian continuing as the surviving corporation and a direct wholly owned subsidiary of Magellan. The Merger is expected to close in the fourth calendar quarter of 2016. The Merger Agreement and the Merger have been approved by the board of directors of each of Magellan and Tellurian. Stockholders of Magellan will be asked to vote on the approval of the transactions contemplated by the Merger Agreement at a special meeting that is expected to be held during the fourth quarter of calendar year 2016. The closing of the Merger is subject to customary closing conditions, including i) the receipt of Magellan and Tellurian stockholder approval; ii) all directors and officers of Magellan shall have resigned, except for any person(s) that might be designated by Tellurian; iii) a registration statement on Form S-4 to register the Magellan shares to be issued in the Merger shall have been declared effective by the SEC; and iv) shares of Magellan common stock to be issued in the Merger shall have been approved for listing on the NASDAQ. The Merger Agreement also contains a non-solicitation provision pursuant to which Magellan may not, directly or indirectly, take certain actions to negotiate or otherwise facilitate an “Alternative Proposal,” a term generally defined as an inquiry, proposal or offer relating to a business combination with or acquisition of the assets of Magellan by a person or entity other than Tellurian. Magellan’s non-solicitation obligations are qualified by “fiduciary out” provisions which provide that Magellan may take certain otherwise prohibited actions with respect to an unsolicited Alternative Proposal if the Board of Directors determines that the failure to take such action would be reasonably likely to be inconsistent with its fiduciary duties and certain other requirements are satisfied. The Merger Agreement may be terminated under certain circumstances, including in specified circumstances in connection with receipt of a "Superior Proposal," as such term is defined in the Merger Agreement. In connection with the termination of the Merger Agreement in the event of a Superior Proposal, a breach by Magellan of the non-solicitation provision noted above, or following a change by the Board of Directors of its recommendation to stockholders, Magellan will be required to pay to Tellurian a termination fee for any and all third-party transaction fees and expenses incurred by Tellurian with the drafting, negotiation, execution and delivery of the Merger Agreement and related documents (including fees and expenses for attorneys, accountants and other advisors), subject to a maximum of $1 million in the aggregate. A termination fee may also be payable in some circumstances in which an Alternative Proposal is made, the transaction fails to close and Magellan subsequently agrees to an Alternative Proposal. If the Merger Agreement is terminated by either party as a result of the failure to obtain the requisite approval by Tellurian stockholders, or by Magellan because Tellurian does not use commercially reasonable efforts to secure the approval for listing the Magellan shares of common stock to be issued in the Merger, then Tellurian will be required to pay to Magellan a reverse termination fee of $1 million. One Stone Exchange. On August 1, 2016, all the conditions to the closing of the Exchange were met and the Exchange was consummated. The primary conditions to closing included i) the receipt of the approval of the Exchange by the Company’s shareholders, which was received on July 13, 2016, during the Company’s annual and special meeting of the shareholders, ii) the consent of WTSB to release a guaranty provided by Magellan, and iii) the payment of the Cash Amount. On August 1, 2016, One Stone paid the Cash Amount to the Company, which was agreed to amount to $900 thousand. In addition, Messrs. Gluzman and Israel, One Stone’s representatives on the Company’s Board of Directors, i) agreed to forego the amount of director compensation, in cash and stock, owed to them and outstanding as of the closing date, which was estimated at approximately $174 thousand in the aggregate and ii) ceased serving as members of the Board effective as of August 1, 2016. In connection with the closing of the Exchange, all of the assets and liabilities of NP were transferred to One Stone in exchange for all of the outstanding shares of the Series A Preferred Stock, the Loan Amount was deemed paid in full, and the Company recorded the difference between the carrying value of the net assets and the Series A Preferred Stock of approximately $9.6 million as a permanent contribution to equity. In addition, since the Exchange constituted a disposition of substantially all of the Company's US assets, the acceleration provisions of the grants of PBOs and MBOs made in October 2013 and October 2014 took effect and these options became fully vested as of the closing of the Exchange. The remaining unamortized expense related to these grants as of the closing date was expensed, which amounted to approximately $235 thousand. Following the closing of the Exchange, the Company canceled all issued and outstanding shares of Series A Preferred Stock, including PIK dividends owing for the period between June 30, 2016 and August 1, 2016, which amounted to 22,815,748 shares. Cancellation of Preferred. On August 10, 2016, the Company filed a certificate of elimination to eliminate its preferred stock. Sale of Weald Basin Assets. On August 11, 2016, the conditions to closing the transactions contemplated by the Weald ATA and IoW ATA were met and the transactions contemplated by these agreements closed, resulting in MPUK receiving, net of the terms of the Settlement Agreement with Celtique, cash proceeds of GBP 446 thousand and approximately 50.9 million shares of UKOG, which shares were worth approximately GBP 703 thousand and GBP 958 thousand as of August 11, 2016. and September 9, 2016, respectively. Stock-Based Compensation. On July 1, 2016, upon the vesting of 12,500 shares of restricted stock previously granted to executives of the Company and pursuant to the tax withholding provisions of the Company's restricted stock award agreements, the Company withheld on a cashless basis 2,529 shares to settle withholding taxes. The withheld shares were immediately canceled. On August 2, 2016, pursuant to the Company's director compensation policy and the 2012 Omnibus Incentive Compensation Plan, a total of 119,505 shares of common stock were issued to the Company's non-employee directors, which represented the amount of stock compensation owed and outstanding to the remaining three directors of the Company, which were due to be issued on July 1, 2015 and 2016. On September 6, 2016, the Company paid cash compensation owed and outstanding to the remaining three directors of the Company in the amount of $201 thousand. On August 2, 2016, the Company's board of directors approved additional compensation for Messrs. MacMillan, Pettirossi, and West in consideration of i) their service as members of the Special Committee since its formation on June 5, 2015, which service had not been remunerated, and ii) the non-payment by the Company of their compensation as directors of the Company since July 2015, and agreed that this compensation would remain wholly contingent upon closing of the transactions contemplated by the Merger Agreement and would amount to the issuance of 100,000 shares of the Company's common stock and the payment of $150 thousand in cash, each in the aggregate. Based on the activity related to our stock grants and restricted stock after June 30, 2016, and including forfeited shares, the Company had 67,471 shares available for future issuance under the 2012 Stock Incentive Plan as of September 9, 2016. Celtique Settlement. On August 11, 2016, the conditions to closing the transactions contemplated by the Weald ATA, the IoW ATA, and the Settlement Agreement were met, and MPUK paid to Celtique GBP 500 thousand in a combination of cash and shares of UKOG pro rata to the consideration payable to MPUK for the Weald ATA. Upon closing, all claims and counterclaims related to PEDLs 231, 234, and 243 between the parties were dismissed. Employee Retention Cash Bonus Plan. On July 15, 2016, the Company paid the portion of the retention bonus granted to certain of the Company’s employees on June 18, 2015, related to the completion of the June 30, 2015 annual report on Form 10-K, which amounted to $108 thousand. Incentive Agreements with Chief Financial Officer. On July 13, 2016, the Company entered into an Amendment to Compensation Agreements with Antoine J. Lafargue, the Company’s Senior Vice President, Chief Financial Officer, Treasurer and Corporate Secretary, which amends the Employment Agreement, the Transaction Incentive Agreement, and the Override Bonus Agreement entered between the Company and Mr. Lafargue on October 12, 2015, to delete the sale or disposition of 95% of the gross assets of the Company from the definition of a Qualifying Transaction, and amend the Override Bonus Agreement to include the value of any dividends in the value of shares of restricted common stock. The purpose of this amendment was to align Mr. Lafargue’s employment and incentive agreements with the objectives of the Company, considered to primarily consist of the conclusion of the strategic alternatives review process with the Merger Agreement. Wilson Employment Termination. On and effective as of August 5, 2016, Mr. Wilson tendered his resignation as the Company’s President and CEO and as a member of the Company’s Board of Directors. In accordance with Mr. Wilson’s employment agreement dated as of October 14, 2014, as amended on February 11, 2015, Mr. Wilson will receive (i) monthly severance payments amounting to $300 thousand in the aggregate, for a period of 12 months, (ii) payment of his accrued vacation amounting to approximately $106 thousand, (iii) reimbursement of medical benefits for a period of up to 18 months, estimated to amount to approximately $35 thousand in the aggregate, and (iv) reimbursement of outstanding expenses. Mr. Wilson will also continue to be entitled to certain equity incentive awards, which were previously granted to Mr. Wilson, subject to the terms of these various awards. On August 9, 2016, Mr. Wilson executed a Termination, Voluntary Release, and Waiver of Rights Agreement with the Company. Appointment of Interim Executive Officer. On August 2, 2016, the board of directors of the Company elected Antoine J. Lafargue, current Senior Vice President, Chief Financial Officer, Treasurer and Corporate Secretary of the Company, to also serve as President and Chief Executive Officer of Magellan, effective as of August 5, 2016. |
Pro Forma Financial Information (Notes) |
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Subsequent Events [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Subsequent Event, Pro Forma Business Combinations or Disposals | Note 21 - Pro Forma Financial Information (Unaudited) The following unaudited pro forma consolidated financial information is presented to give effect to (i) the transactions contemplated by the Exchange Agreement between Magellan and One Stone dated March 31, 2016 that closed on August 1, 2016 and (ii) the sale of Weald Basin exploration licenses in the United Kingdom and the related settlement of litigation with Celtique completed on August 11, 2016, and whose transfer and settlement agreements were signed on June 10, 2016. The unaudited pro forma consolidated financial statements set forth information relating to the Exchange and the Weald ATA as if they had been completed on June 30, 2016, with respect to consolidated balance sheet data, and as if they had become effective on July 1, 2014, with respect to consolidated statement of operations data for fiscal years ended June 30, 2016, and 2015. The unaudited pro forma consolidated financial information does not necessarily reflect what the historical results of the Company would have been had the transactions occurred on the respective dates. MAGELLAN PETROLEUM CORPORATION UNAUDITED PRO FORMA CONSOLIDATED BALANCE SHEET JUNE 30, 2016 (in thousands)
MAGELLAN PETROLEUM CORPORATION UNAUDITED PRO FORMA CONSOLIDATED STATEMENT OF OPERATIONS FOR THE YEAR ENDED JUNE 30, 2016 (in thousands, except shares and per share amounts)
MAGELLAN PETROLEUM CORPORATION UNAUDITED PRO FORMA CONSOLIDATED STATEMENT OF OPERATIONS FOR THE YEAR ENDED JUNE 30, 2015 (in thousands, except shares and per share amounts)
Pro forma adjustments and assumptions.The unaudited pro forma consolidated financial statements have been prepared by adjusting the Company's historical financial statements as discussed below: Pro forma adjustments related to the Exchange: (a) The amount represents the pro forma adjustment for the Cash Amount (as defined in the Exchange Agreement). $900 thousand was paid at closing, which takes into account the $625 thousand borrowed from One Stone on April 15, 2016, under the Secured Promissory Note. The Cash Amount represents the loss from operations of Nautilus Poplar LLC from the September 30, 2015 effective date of the Exchange, adjusted for certain transaction costs and other amounts paid by Magellan prior to closing. (b) The amount represents the pro forma adjustment for transaction costs related to the exchange of $467 thousand, which were paid at closing on August 1, 2016. (c) The amount represents the elimination of the assets and liabilities held for sale of Nautilus Poplar LLC and Utah CO2 LLC, the elimination of the preferred stock, related dividends and adjustments to redemption value. (d) The amount represents the pro forma effect of the removal of collateral held by Magellan for certain surety bonds that were transferred to One Stone at closing of the Exchange. (e) The amount represents the pro forma effect of the removal of accrued director fees for the One Stone directors, which were forgiven at the closing of the Exchange. Pro forma adjustments related to the Weald Asset Transfer Agreement: (f) The amount represents the pro forma effect of the cash proceeds and the value of the 50.9 million shares of UKOG received at the closing of the transactions contemplated by the Weald ATA on August 11, 2016. (g) The amounts represent the pro forma effects of the elimination of the assets and liabilities held for sale related to the Weald ATA, including GBP 500 thousand related to the settlement of the litigation with Celtique, our partner in the Weald Basin licenses. In addition to the above pro forma adjustments, the closing of the Exchange with One Stone triggered accelerated vesting provisions of some of the Company's stock options. Had the closing occurred on July 1, 2014, additional expense related to these stock options would have been recognized as of that date, rather than normal amortization of the expense. No adjustment for the effect of the acceleration of vesting has been included in the unaudited consolidated pro forma financial statements above. |
Supplemental Oil and Gas Information (Unaudited) |
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Oil and Gas Exploration and Production Industries Disclosures [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Supplemental Oil and Gas Information (Unaudited) | Supplemental Oil and Gas Reserve Information The Company relies upon a combination of internal technical staff and third party consulting arrangements for reserve estimation and review. The reserve information presented below is based on estimates of net proved reserves as of June 30, 2016, and 2015, and was prepared in accordance with guidelines established by the SEC. Reserve estimates as of June 30, 2016 were prepared by Guot Anyak, who was employed by the Company as a Petroleum Engineer from August 2012 until August 1, 2016. Mr. Anyak is a graduate of the Colorado School of Mines and holds a Bachelor of Science degree in Petroleum Engineering. Mr. Anyak has been instrumental in the analysis of the economics of certain well workovers at Poplar, and has supported the preparation of the Company’s reserve estimates over the past several years. Reserve estimates as of June 30, 2015 were prepared by Hector Wills of Mi3 Petroleum Engineering, a Golden, Colorado-based petroleum engineering firm. Reserve estimates for the fiscal year ended June 30, 2016 were unaudited, and reserve estimates for the fiscal year ended June 30, 2015 were audited by the Company's independent petroleum engineering firm, Allen & Crouch Petroleum Engineers ("A&C"). A copy of the summary reserve audit report of A&C is provided as Exhibit 99.1 to this Annual Report on Form 10-K. A&C does not own an interest in any of Magellan's oil and gas properties and is not employed by Magellan on a contingent basis. Proved reserves are the estimated quantities of oil, gas, and natural gas liquids, which, by analysis of geoscience and engineering data, can be estimated with reasonable certainty to be economically producible from a given date forward, from known reservoirs, and under existing economic conditions, operating methods, and government regulations prior to the time at which contracts providing the right to operate expire, unless evidence indicates that renewal is reasonably certain, regardless of whether deterministic or probabilistic methods are used for the estimation. Existing economic conditions include prices and costs at which economic producibility from a reservoir is to be determined and the price to be used is the average price during the 12-month period prior to the ending date of the period covered by the report, determined as an unweighted arithmetic average of the first-day-of-the-month price for each month within such period, unless prices are defined by contractual arrangements, excluding escalations based upon future conditions. All of the Company's estimated proved reserves are located in the US and relate to NP, which has been discontinued. Analysis of Changes in Proved Reserves The following table sets forth information regarding the Company's estimated proved oil and gas reserve quantities, all of which are included in assets held for sale in the accompanying consolidated balance sheets as of June 30, 2016 and 2015. The Company emphasizes that reserve estimates are inherently imprecise and that estimates of new discoveries and undeveloped locations are more imprecise than estimates of established producing oil and gas properties. Accordingly, these estimates are expected to change as economic conditions change and new information becomes available.
. Revision of previous estimates. Revisions of estimates represent downward changes in previous estimates attributable to new information gained primarily from development activity, production history, and changes to the economic conditions and the financial condition of the Company at the time of each estimate. During the year ended June 30, 2016, there was a 1,284 Mbbls downward revision of estimated proved reserves. The revisions were due to removal of proved developed non-producing reserves of 643 Mbbls due to the suspension of the Company's workover program and shorter economic lives for certain wells due to lower average crude oil prices. During the year ended June 30, 2015, there was a 3,417 Mbbls downward revision of estimated proved reserves. The majority of the revision relates to the removal of 3,083 Mbbls of proved undeveloped reserves from the classification of proved reserves due to the uncertainty surrounding the Company's ability to continue as a going concern and to obtain the necessary capital to develop the PUD locations. During fiscal 2016, the Company did not convert any proved undeveloped reserves to proved developed reserves. Standardized Measure of Oil and Gas The Company computes a standardized measure of future net cash flows and changes therein relating to estimated proved reserves in accordance with authoritative accounting guidance. Certain information concerning the assumptions used in computing the valuation of proved reserves and their inherent limitations are discussed below. The Company believes such information is essential for a proper understanding and assessment of the data presented. The "standardized measure" is the present value of estimated future cash inflows from proved oil and natural gas reserves, less future development and production costs and future income tax expenses, using prices and costs as of the date of estimation without future escalation, without giving effect to hedging activities, non-property related expenses such as general and administrative expenses, debt service, depreciation, depletion, and amortization, and tax, and are discounted using an annual discount rate of 10% to reflect timing of future cash flows. The assumptions used to calculate estimated future cash inflows do not necessarily reflect the Company's expectations of actual revenues or costs, nor their present worth. In addition, variations from the expected production rate also could result directly or indirectly from factors outside of the Company's control, such as unexpected delays in development, changes in prices, or regulatory or environmental policies. The reserve valuation further assumes that all reserves will be disposed of by production. However, if reserves are sold in place, additional economic considerations could affect the amount of cash eventually realized. Prices. All prices used in the calculation of our reserves are based upon a twelve month unweighted arithmetic average of the first day of the month price for the twelve months of the fiscal year, unless prices were defined by contractual arrangements. Prices are adjusted for local differentials and gravity and, as required by the SEC, held constant for the life of the projects (i.e., no escalation). The following table summarizes the resulting prices used for proved reserves for the fiscal years ended:
Costs. Future development and production costs are calculated by estimating the expenditures to be incurred in developing and producing the proved oil and gas reserves at the end of the year, based on year-end costs and assuming continuation of existing economic conditions. Income taxes. Future income tax expenses are calculated by applying the appropriate year-end statutory tax rates, with consideration of future tax rates already legislated, to the future pre-tax net cash flows relating to the Company's proved oil and gas reserves. Permanent differences in oil and gas related tax credits and allowances are recognized. Discount. The present value of future net cash flows from the Company's proved reserves is calculated using a 10% annual discount rate. This rate is not necessarily the same as that used to calculate the current market value of our estimated oil and natural gas reserves. The following table presents the standardized measure of discounted future net cash flows related to proved oil and gas reserves for the United States cost center only:
A summary of changes in the standardized measure of discounted future net cash flows is as follows:
(1) The increase in cash flows from the net change in income taxes in fiscal year 2015 represents the decrease in future income taxes as a result of the elimination of cash flows from PUD reserves. (2) For fiscal year 2016, there was an $11.0 million downward revision in reserve value due to the net change in prices and production costs. This change was the result of the steep decline in the WTI price, the benchmark oil price for sale of the Company's crude oil. (3) The downward revision of $5.8 million relates to the reduction of 643 Mbbls of proved developed non-producing reserves as a result of the elimination of the Company's workover program. |
Oil and Gas Activities (Unaudited) |
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Oil and Gas Exploration and Production Industries Disclosures [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Oil and Gas Activities (Unaudited) | Costs Incurred in Oil and Gas Producing Activities Costs incurred in oil and gas property acquisition, exploration, and development activities, whether capitalized or expensed, are summarized as follows:
Net Changes in Capitalized Costs The net changes in capitalized costs that are currently not being depleted pending the determination of proved reserves can be summarized as follows:
(1) On March 31, 2016, Magellan and One Stone entered into an Exchange Agreement that providing for, among other things, the transfer to the Company of 100% of the outstanding shares of Magellan Series A Preferred Stock in consideration for the assignment to and assumption by One Stone of 100% of the outstanding membership interests in Nautilus Poplar LLC. The transactions contemplated by the Exchange Agreement closed on August 1, 2016. (2) On June 10, 2016, Magellan entered into the Weald ATA for the sale of its interest in certain exploration licenses to UKOG. The transactions contemplated by the Weald ATA closed on August 11, 2016. (3) The Company reviewed the recoverability of the carrying values of its wells in progress to be transferred to One Stone in the Exchange, and as a result of this review recorded an impairment of $3.4 million to adjust the carrying value of wells in progress to their estimated fair values less costs to sell at June 30, 2016. (4) The Company reclassified the capitalized costs for two of the five CO2-enhanced oil recovery pilot wells from wells in progress to producing properties during the fourth quarter of fiscal 2015. In the United Kingdom, during the third quarter of fiscal year 2015, the Company allowed a petroleum license to expire and recorded exploration expense of $20 thousand. During the fourth quarter of fiscal year 2015, the Company sold its interest in a license in the United Kingdom with a remaining capitalized cost of $0.7 million. At June 30, 2016, the Company had no costs capitalized for exploratory wells in progress for a period of greater than one year after the completion of drilling. |
Basis of Presentation (Policies) |
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Accounting Policies [Abstract] | |
Principles of Consolidation and Basis of Presentation | Principles of Consolidation and Basis of Presentation The accompanying consolidated financial statements include the accounts of Magellan and its wholly owned subsidiaries, NP (which has been discontinued), MPUK, and MPA, and have been prepared in accordance with accounting principles generally accepted in the United States ("GAAP") and the instructions to Form 10-K and Regulation S-X published by the US Securities and Exchange Commission (the "SEC"). All intercompany accounts and transactions have been eliminated. Effective with the execution of the Exchange Agreement on March 31, 2016, the Company has reclassified the operations of NP to discontinued operations and reclassified its related assets and liabilities to assets and liabilities held for sale for all periods presented in the accompanying consolidated financial statements. Effective with the execution of the Weald Agreements on June 10, 2016, the Company has reclassified the operations in connection with the respective licenses to discontinued operations and reclassified its related assets and liabilities to assets and liabilities held for sale for all periods presented in the accompanying consolidated financial statements. Certain prior year amounts have been reclassified to conform to the current year presentation. Such reclassifications had no effect on the prior year net loss attributable to common stockholders, accumulated deficit, net assets, or total shareholders' equity. The Company has evaluated events or transactions through the date of issuance of this report in conjunction with the preparation of these consolidated financial statements. All amounts presented are in US dollars, unless otherwise noted. Amounts expressed in Australian currency are indicated as "AUD." Amounts expressed in the currency of the United Kingdom are indicated as "GBP." |
Use of Estimates | Use of Estimates The preparation of consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of oil and gas reserves, assets and liabilities, disclosure of contingent assets and liabilities at the date of the consolidated financial statements, and the reported amounts of revenues and expenses, including stock-based compensation expense, during the reporting periods. Actual results could differ from those estimates. |
Foreign Currency Translation | Foreign Currency Translation The functional currency of our foreign subsidiaries is their local currency. Assets and liabilities of foreign subsidiaries are translated to US dollars at period-end exchange rates, and our consolidated statements of operations and cash flows are translated at average exchange rates during the reporting periods. Resulting translation adjustments are recorded in accumulated other comprehensive income, a separate component of stockholders' equity. A component of accumulated other comprehensive income will be released into income when the Company executes a partial or complete sale of an investment in a foreign subsidiary or a group of assets of a foreign subsidiary considered a business and/or when the Company no longer holds a controlling financial interest in a foreign subsidiary or group of assets of a foreign subsidiary considered a business. Transactions denominated in currencies other than the local currency are recorded based on exchange rates at the time such transactions arise. Subsequent changes in exchange rates result in foreign currency transaction gains and losses that are reflected in results of operations as unrealized (based on period end translation) or realized (upon settlement of the transactions) and reported under general and administrative expenses in the consolidated statements of operations. During the fiscal year ended June 30, 2015, the Company made a determination that it was no longer permanently invested in its foreign subsidiaries because (i) the Company had begun an effort to repay its intercompany balances through the repatriation of cash from these subsidiaries and (ii) the Company was increasingly focusing on its US operations. As such, the Company recorded on its statement of operations for the fiscal year ended June 30, 2015, an expense reclassification from accumulated other comprehensive income arising from foreign currency exchange losses on its intercompany account balances. |
Cash and Cash Equivalents | Cash and Cash Equivalents and Concentration of Credit Risk The Company considers all highly liquid short-term investments with original maturities of three months or less at the date of acquisition to be cash equivalents. The carrying value of cash and cash equivalents approximates fair value due to the short term nature of these instruments. |
Concentration of Credit Risk | The Company's financial instruments exposed to concentrations of credit risk consist primarily of cash and cash equivalents. The Company regularly assesses the level of credit risk we are exposed to and whether there are better ways of managing credit risk. The Company invests its cash and cash equivalents with reputable financial institutions. At times, balances deposited may exceed FDIC insured limits. The Company has not incurred any losses related to these deposits. |
Securities Available-for-Sale | Securities Available-for-Sale Securities available-for-sale are comprised of investments in publicly traded securities and are carried at quoted market prices. Unrealized gains and losses are excluded from earnings and recorded as a component of accumulated other comprehensive income in stockholders' (deficit) equity, net of deferred income taxes. The Company recognizes gains or losses when securities are sold. On a quarterly basis, we perform an assessment to determine whether there have been any events or economic circumstances to indicate that a security with an unrealized loss has suffered an other-than-temporary impairment. The Company performed this analysis as of June 30, 2016, and concluded that it had not incurred an other-than temporary impairment. During the fiscal year ended June 30, 2015, the Company determined that the value of its investment in Central had suffered an other-than temporary impairment. As such, the unrealized loss on this investment was reclassified from other comprehensive income to the consolidated statement of operations at June 30, 2015. |
Accounts Receivable | Accounts Receivable Trade accounts receivable consist mainly of receivables from oil and gas purchasers. For receivables from working interest partners, the Company typically has the ability to withhold future revenue disbursements to recover non-payment of joint interest billings. Generally, oil and gas receivables are collected within two months. The collectability of accounts receivable is continuously monitored and analyzed based upon historical experience. The use of judgment is required to establish a provision for allowance for doubtful accounts for specific customer collection issues identified. |
Oil and Gas Exploration and Production Activities and Impairment of Long-Lived Assets | Oil and Gas Exploration and Production Activities The Company follows the successful efforts method of accounting for its oil and gas exploration and production activities. Under this method, all property acquisition costs, and costs of exploratory and development wells are capitalized until a determination is made that the well has found proved reserves or is deemed noncommercial. If an exploratory well is deemed to be noncommercial, the well costs are charged to exploration expense as dry hole costs. Exploration expenses include dry hole costs and geological and geophysical expenses. Noncommercial development well costs are charged to impairment expense if circumstances indicate that a decline in the recoverability of the carrying value may have occurred. The Company records its proportionate share in joint venture operations in the respective classifications of assets, liabilities, and expenses. The cost of CO2 injection is capitalized until a production response is seen as a result of the injection and it is determined that the well has found proved reserves. After oil production from the well begins, CO2 injection costs are expensed as incurred. Depreciation, depletion, and amortization ("DD&A") of capitalized costs related to proved oil and gas properties is calculated on a property-by-property basis using the units-of-production method based upon proved reserves. The computation of DD&A takes into consideration restoration, dismantlement, and abandonment costs as well as the estimated proceeds from salvaging equipment. As all of the Company's proved oil and gas properties related to NP, DD&A has been reclassified to discontinued operations for all periods presented in the accompanying consolidated statements of operations. Effective with the classification of the assets and liabilities of NP to held for sale on March 31, 2016, including the proved oil and gas properties, the Company halted DD&A related to these assets and no further DD&A has been recorded in the accompanying consolidated financial statements for the period from April 1, 2016 through June 30, 2016. The sale of a partial interest in a proved oil and gas property is accounted for as normal retirement, and no gain or loss is recognized as long as the treatment does not significantly affect the units-of-production depletion rate. A gain or loss is recognized for all other sales of producing properties. The sale of a partial interest in an unproved oil and gas property is accounted for as a recovery of cost, with any excess of the proceeds over such cost or related carrying amount recognized as gain. Impairment of Long-Lived Assets The Company reviews the carrying amount of its oil and gas properties and unproved leaseholds for impairment annually or whenever events or changes in circumstances indicate that a decline in the recoverability of their carrying value may have occurred. The Company estimates the expected undiscounted future cash flows of its oil and gas properties and compares such undiscounted future cash flows to the carrying amount of the oil and gas properties to determine if the carrying amount is recoverable. If the carrying amount exceeds the estimated undiscounted future cash flows, the Company will adjust the carrying amount of the oil and gas properties to fair value. The factors used to determine fair value include, but are not limited to, recent sales prices of comparable properties, the present value of estimated future cash flows, net of estimated operating and development costs, using estimates of reserves, future commodity pricing, future production estimates, anticipated capital expenditures, and various discount rates commensurate with the risk and current market conditions associated with realizing the expected cash flows projected. In connection with the Exchange Agreement and the reclassification of NP's oil and gas properties to assets held for sale, the Company undertook such a review at March 31, 2016, and recorded an impairment of the proved oil and gas properties of $7.8 million and an impairment of its wells in progress of $3.4 million, both included in the loss from discontinued operations in the accompanying consolidated statements of operations for the year ended June 30, 2016. The Company used a fairness opinion provided by a third party in connection with the Exchange and an internally developed cash flow model to value the oil and gas properties of NP. As of June 30, 2016, the properties continue to be included in assets held for sale at their adjusted carrying values representing their fair values less costs to sell, which as of June 30, 2016, approximately equaled the fair values less costs to sell as determined at March 31, 2016. The Company also undertook such a review during the year ended June 30, 2015, and as a result of the decline in oil prices, concluded that its proved oil and gas properties were impaired and recorded an impairment loss of $17.4 million in the accompanying consolidated statement of operations. |
Land, Buildings, and Equipment | Land, Buildings, and Equipment Land, buildings, and equipment are recorded at cost. Costs of renewals and improvements that substantially extend the useful lives of the assets are capitalized. Maintenance and repair costs are expensed when incurred. Depreciation is calculated using the straight-line method over the estimated useful lives of the assets, which range from three to fifteen years. |
Goodwill | Goodwill Goodwill represents the excess of the purchase price over the estimated fair value of the assets acquired, net of the fair value of liabilities assumed in an acquisition. The goodwill recorded as of June 30, 2016 and 2015 of $500 thousand related to the Company's foreign subsidiaries, of which amount $275 thousand related to MPA, and $225 thousand related to MPUK. GAAP requires goodwill to be evaluated on an annual basis for impairment, or more frequently if events occur or circumstances change that could potentially result in impairment. For the year ended June 30, 2016, as a result of management's intent to monetize certain assets, including those of its foreign subsidiaries, and the progress of negotiations related to the sale of those assets, the Company performed an analysis of qualitative factors to determine whether further evaluation under GAAP (the two-step test) was required. As a result of this qualitative analysis, the Company determined that it was not more likely than not that the carrying value of its foreign reporting units, including goodwill, were less than their carrying amounts. Therefore, no further testing for impairment of the Company's goodwill balances at June 30, 2016 was performed. As of June 30, 2015, management concluded that as a result of the decline in reserve value, principally due to the decline in commodity prices, and a downward revision in reserve quantities as the result of the exclusion of PUD reserves from the Company's reserve estimates, goodwill related to NP had been impaired. Accordingly, we recorded impairment expense of $674 thousand for the year ended June 30, 2015, which is included in discontinued operations in the accompanying consolidated statement of operations. The qualitative factors used in our assessment included macroeconomic conditions, industry and market conditions, cost factors, and overall financial performance. The quantitative analysis performed included a review of the June 30, 2015 reserve estimates using forward commodity prices and an estimate of the differential less the liabilities for NP, and comparing the result of the analysis to the recorded carrying value of the net assets. The analysis indicated that the carrying value of the net assets exceeded the calculated value of the reserves net of liabilities, and therefore, an impairment had occurred. |
Asset Retirement Obligations | Asset Retirement Obligations The Company recognizes an estimated liability for future costs associated with the plugging and abandonment of its oil and gas properties. A liability for the fair value of an asset retirement obligation and corresponding increase in the carrying value of the related long-lived asset are recorded at the time a well is acquired or the liability to plug is legally incurred. Assumptions and judgments made by management when assessing an asset retirement obligation include: (i) the existence of a legal obligation; (ii) estimated probabilities, amounts, and timing of settlements; (iii) the credit-adjusted risk-free rate to be used; and (iv) inflation rates. The Company depletes the amount added to proved oil and gas property costs, net of estimated salvage values, and recognizes expense in connection with the accretion of the discounted liability over the remaining estimated economic lives of the respective oil and gas properties. |
Revenue Recognition | Revenue Recognition The Company has historically derived revenue primarily from the sale of produced oil. Oil revenues are recognized when production is sold to a purchaser at a fixed or determinable price, when delivery has occurred and title has transferred, and collection of the revenue is probable. |
Major Customers | Major Customers The Company's consolidated oil production revenue is derived from its NP segment and was generated from two customers for the years ended June 30, 2016 and 2015. |
Share Based Compensation | Stock-Based Compensation Stock option grants may contain time-based, market-based, or performance-based vesting provisions. Time-based options ("TBOs") are expensed on a straight-line basis over the vesting period. Market-based options ("MBOs") are expensed on a straight-line basis over the derived service period, even if the market condition is not achieved. Performance-based options ("PBOs") are amortized on a straight-line basis between the date upon which the achievement of the relevant performance condition is deemed probable and the date the performance condition is expected to be achieved. Management re-assesses whether achievement of performance conditions is probable at the end of each reporting period. If changes in the estimated outcome of the performance conditions affect the quantity of the awards expected to vest, the cumulative effect of the change is recognized in the period of change. The fair value of the stock options is determined on the grant date and is affected by our stock price and other assumptions regarding a number of complex and subjective variables. These variables include our expected stock price volatility over the term of the awards, risk-free interest rates, expected dividends, and the expected option exercise term. The Company estimates the fair value of PBOs and time-based stock options using the Black-Scholes-Merton pricing model. The simplified method is used to estimate the expected term of stock options due to a lack of related historical data regarding exercise, cancellation, and forfeiture. For MBOs, the fair value is estimated using Monte Carlo simulation techniques. |
Accounting for Income Taxes | Accounting for Income Taxes The Company follows the liability method in accounting for income taxes. Under this method, deferred tax assets and liabilities are determined based on differences between the financial reporting and tax bases of assets and liabilities and are measured using the enacted tax rates and laws that will be in effect when the differences are expected to reverse. The Company records a valuation allowance for deferred tax assets when it is more likely than not that such assets will not be recovered. GAAP prescribes a comprehensive model for recognizing, measuring, presenting, and disclosing in the financial statements uncertain tax positions that the Company has taken or expects to take in its tax returns. Under GAAP, the Company recognizes tax positions when it is more likely than not that a tax position will be sustained upon examination, including resolution of any related appeals or litigation processes, based on the technical merits of the position. In evaluating whether a tax position has met the more-likely-than-not recognition threshold, the Company has presumed that its positions will be examined by the appropriate taxing authority that has full knowledge of all relevant information. The next step consists of measurement. A tax position that meets the more-likely-than-not recognition threshold is measured to determine the amount of benefit to recognize in the financial statements. A tax position is measured at the largest amount of benefit that has a greater than 50% likelihood of being realized upon ultimate settlement. An uncertain income tax position will not be recognized if it does not meet the more-likely-than-not threshold. To appropriately account for income tax matters, the Company is required to make significant judgments and estimates regarding the recoverability of deferred tax assets, the likelihood of the outcome of examinations of tax positions that may or may not be currently under review, and potential scenarios involving settlements of such matters. Changes in these estimates could materially impact the consolidated financial statements. There are no uncertain tax positions that would meet the more-likely-than-not recognition threshold for the fiscal years ended June 30, 2016, or 2015. The Company has adopted an accounting policy to record all tax-related interest under interest expense and tax-related penalties under general and administrative expense in the consolidated statement of operations. |
Financial Instruments | Financial Instruments The carrying values for accounts receivable, accounts payable and debt approximate fair value based on the timing of the anticipated cash flows and current market conditions. |
Segment Information | Segment Information As of June 30, 2016, the Company determined, based on the criteria of Financial Accounting Standards Board (the "FASB") Accounting Standards Codification Topic 280, that it operated in two segments, MPUK and MPA, as well as a head office, Magellan ("Corporate"), which is treated as a cost center. As of June 30, 2016, these two operating segments met the minimum quantitative threshold to qualify for separate segment reporting. The Company's chief operating decision maker is Antoine J. Lafargue (President and CEO of the Company), who reviews the results and manages operations of the Company in the two reporting segments of MPUK and MPA, and Corporate. The presentation of all segment information herein reflects the manner in which the Company's management monitors performance and allocates resources. Prior to signing the Exchange Agreement, and the related reclassification of the assets and liabilities of NP to held for sale, and classification of NP's results of operations to discontinued operations, the Company operated in three segments. For further information pertaining to our reporting segments, see Note 15 - Segment Information. |
Loss per Common Share | Loss per Common Share Income and losses per common share are based upon the weighted average number of common and common equivalent shares outstanding during the period. The effects of potentially dilutive securities in the determination of diluted earnings per share are the dilutive effect of stock options and the shares of Series A Preferred Stock. The potentially dilutive impact of stock options is determined using the treasury stock method. The potentially dilutive impact of the shares of Series A Preferred Stock is determined using the if-converted method. In applying the if-converted method, conversion is not assumed for purposes of computing dilutive shares if the effect would be anti-dilutive. The Series A Preferred Stock is convertible at a rate of one common share for one preferred share, multiplied by an applicable conversion ratio. We did not include any stock options nor common stock issuable upon the conversion of the Series A Preferred Stock in the calculation of diluted loss per share during the fiscal years ended June 30, 2016, and 2015, as their effect would have been anti-dilutive due to net losses in those periods. |
Accumulated Other Comprehensive Loss | Accumulated Other Comprehensive Income Loss Other comprehensive (loss) income is presented net of applicable income taxes in the accompanying consolidated statements of stockholders' (deficit) equity and comprehensive loss. Other comprehensive (loss) income is comprised of revenues, expenses, gains, and losses that under GAAP are reported as separate components of stockholders' (deficit) equity instead of net loss. |
Recently Issued Accounting Standards | Recently Issued Accounting Standards In August 2016, the FASB issued Accounting Standards Update ("ASU") No. 2016-15, which is intended to reduce diversity in practice in reporting certain items in the statement of cash flows. This standard will be effective for the Company for its first interim period in its fiscal year ending June 30, 2019, and early adoption is permitted. The Company does not expect adoption of ASU 2016-15 to have a material effect on its consolidated financial statements. In March 2016, the FASB issued ASU No. 2016-09, which is intended to improve the accounting for employee share-based payments and affect all organizations that issue share-based payment awards to their employees. Several aspects of the accounting for share-based payment award transactions are simplified, including: (a) income tax consequences; (b) classification of awards as either equity or liabilities; (c) classification on the statement of cash flows; and (d) accounting for forfeitures. This standard will be effective for the Company for its first interim period in its fiscal year ending June 30, 2018, and early adoption is permitted. The Company is evaluating the impact of the adoption of this standard on its consolidated financial statements. In February 2016, the FASB issued ASU No. 2016-02, which establishes a right-of-use model that requires a lessee to record a right-of-use asset and a lease liability on the balance sheet for all leases with terms longer than 12 months, and provides revised guidance on lease classification as finance or operating, with classification affecting the pattern of expense recognition in the statement of operations or comprehensive loss, and the pattern of cash flow classification in the statement of cash flows. This standard will be effective for the Company for its first interim period in its fiscal year ending June 30, 2020. A modified retrospective transition approach is required for lessees for capital and operating leases existing at, or entered into after, the beginning of the earliest comparative period presented in the financial statements, with certain practical expedients available. The Company is evaluating the impact of the adoption of this standard on its consolidated financial statements. In January 2016, the FASB issued ASU No. 2016-01, which addresses certain aspects of recognition, measurement, presentation and disclosure of financial instruments. This standard will be effective for the Company for its first interim period in its fiscal year ending June 30, 2019, with earlier application not permitted with the exception of certain specific provisions. The Company is evaluating the impact of the adoption of this standard on its consolidated financial statements. In November 2015, the FASB issued ASU No. 2015-17, which simplifies the presentation of deferred income taxes in the classified balance sheet, by removing the requirement to separate current and noncurrent deferred taxes and requiring deferred tax assets and liabilities to be classified as noncurrent. This standard will be effective for the Company for its first interim period in its fiscal year ending June 30, 2018, and early adoption is permitted. The Company does not expect adoption of ASU 2015-17 to have a material effect on its consolidated financial statements. In September 2015, the FASB issued ASU No. 2015-16, which simplifies the accounting for adjustments made to provisional amounts recognized at the acquisition date in a business combination, by eliminating the requirement to retrospectively account for such adjustments for which the accounting is incomplete by the end of the reporting period in which the combination occurs. This standard will be effective for the Company for its first interim period in its fiscal year ending June 30, 2017. The Company is evaluating the impact of the adoption of this standard on its consolidated financial statements. In August 2015, the FASB issued ASU No. 2015-15, which amends presentation and disclosure requirements outlined in ASU 2015-03 by clarifying guidance for debt issuance costs related to line of credit arrangements, provided that the SEC would not object to presentation of debt issuance costs related to a line of credit arrangement as an asset, and amortizing them ratably over the term of the line of credit arrangement. This standard will be effective for the Company for its first interim period in its fiscal year ending June 30, 2017. The Company does not expect adoption of ASU 2015-15 to have a material effect on its consolidated financial statements. In August 2014, the FASB issued ASU No. 2014-15, which provides guidance on management’s responsibility to evaluate whether there is substantial doubt about a company’s ability to continue as a going concern and to provide related footnote disclosures. This standard will be effective for the Company's fiscal year ending June 30, 2017, and annual and interim periods thereafter. The Company is evaluating the impact of the adoption of this standard on its consolidated financial statements. In April 2014, the FASB issued ASU No. 2014-8, which changed the requirements for reporting discontinued operations and disclosures of disposals of components of an entity. ASU 2014-8 is effective for all disposals (or classifications as held for sale) of components of an entity that occur within annual periods beginning on or after December 15, 2014, and interim periods within those years. The Company has adopted this standard and applied its guidance to its reporting and disclosure of the One Stone Exchange, the Weald ATA and the IoW ATA, and discontinued operations of NP and MPUK (see Notes 2, 3 and 4). There are no new significant accounting standards applicable to the Company that have been issued but not yet adopted by the Company as of June 30, 2016. |
Discontinued Operations (Tables) |
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Jun. 30, 2016 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Discontinued Operations and Disposal Groups [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Disposal Groups, Including Discontinued Operations, Income Statement, Balance Sheet and Additional Disclosures | The adjusted carrying amounts of the major classes of assets and liabilities included in discontinued operations are as follows:
Summarized results of the Company's discontinued operations are as follows:
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Asset Retirement Obligations Roll-Forward | The following table summarizes the asset retirement obligation activity included in liabilities held for sale for the fiscal years ended:
The following table summarizes the asset retirement obligation activity for the fiscal years ended:
(1) In fiscal 2015, the Company sold its 40% interest in PEDL 126, the exploration license that contains the Markwells Wood-1 wellbore. By selling the license and the wellbore, the Company was able to eliminate its current asset retirement obligation related to the wellbore. |
Securities Available-for-Sale (Tables) |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2016 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Investments, Debt and Equity Securities [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Available-for-sale Securities | The following table presents the amortized cost, gross unrealized gains, gross unrealized losses and fair market value of available-for-sale equity securities as follows:
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Notes Payable (Tables) |
12 Months Ended | |||||||||||||||||||||||||||||||||||
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Jun. 30, 2016 | ||||||||||||||||||||||||||||||||||||
Debt Disclosure [Abstract] | ||||||||||||||||||||||||||||||||||||
Schedule of annual principal payments | Scheduled annual principal payments of Notes Payable are as follows:
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Asset Retirement Obligations (Tables) |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2016 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Asset Retirement Obligation Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Asset Retirement Obligations Roll-Forward | The following table summarizes the asset retirement obligation activity included in liabilities held for sale for the fiscal years ended:
The following table summarizes the asset retirement obligation activity for the fiscal years ended:
(1) In fiscal 2015, the Company sold its 40% interest in PEDL 126, the exploration license that contains the Markwells Wood-1 wellbore. By selling the license and the wellbore, the Company was able to eliminate its current asset retirement obligation related to the wellbore. |
Fair Value Measurements (Tables) |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2016 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Fair Value Disclosures [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Fair Value, Assets and Liabilities Measured on Recurring Basis |
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Fair Value Inputs, Assets, Quantitative Information | The following table presents information about significant unobservable inputs to the contingent consideration payable measured at fair value on a recurring basis for the fiscal years ended:
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Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation | The following table presents a roll forward of the contingent consideration payable for the fiscal years ended:
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Income Taxes (Tables) |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2016 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Income Tax Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Income before Income Tax, Domestic and Foreign | The domestic and foreign components of our income (loss) from continuing operations are as follows for the fiscal years ended:
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Schedule of Effective Income Tax Rate Reconciliation | The following reconciles the Company's effective tax rate from continuing operations to the federal statutory tax rate for the fiscal years ended:
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Schedule of Components of Income Tax Provision | The following summarizes components of our income tax provision for the fiscal years ended:
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Schedule of Deferred Tax Assets and Liabilities | Significant components of the Company's deferred tax assets and liabilities of continuing operations can be summarized as follows for the fiscal years ended:
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Summary of Jurisdictions Subject to Income Tax Examination | As of June 30, 2016, the Company remains subject to examination in the following major tax jurisdictions for the tax years indicated below:
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Summary of Operating Loss and Tax Credit Carryforwards | At June 30, 2016, the Company had net operating loss and foreign tax credit carry forwards for US federal and state income tax purposes, respectively, which are scheduled to expire periodically as follows:
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Stock Based Compensation (Tables) |
12 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2016 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Stock Option Activity | As of June 30, 2016, a total of 332,028 MBOs and PBOs had not vested |
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Shares Authorized under Stock Option Plans, by Exercise Price Range | The following table summarizes options outstanding and exercisable as of June 30, 2016:
(1) Weighted average exercise price per share. |
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Fair Value of Shares Issued Under the Stock Plan and Weighted-Average Assumptions | The fair value of shares issued under the 2012 Stock Incentive Plan were estimated using the following weighted-average assumptions for the fiscal years ended:
(1) The terms related to these PBOs were estimated using an average probabilistic weighted method. (2) The Company assumed MBOs will be voluntarily exercised at the midpoint of vesting and the contractual term. |
Preferred Stock (Tables) |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2016 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Equity [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Preferred Stock Activity | The following table summarizes the Series A Preferred Stock activity for the fiscal years ended:
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Stockholders' (Deficit) Equity (Tables) |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2016 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Equity [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Treasury Stock by Class | The following table summarizes the Company's treasury stock activity for the fiscal years ended:
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Loss Per Share (Tables) |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2016 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Earnings Per Share [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Loss Per Share, Basic and Diluted | The following table summarizes the computation of basic and diluted loss per share for the fiscal years ended:
(1) All diluted earnings per share calculations are dictated by the results from continuing operations; accordingly there were no dilutive effects on earnings per share in the periods presented since all such periods had a net loss from continuing operations. |
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Schedule of Antidilutive Securities Excluded from Computation of Earnings Per Share [Table Text Block] | Potentially dilutive securities excluded from the calculation of diluted shares outstanding in fiscal years with net losses from continuing operations are as follows:
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Segment Information (Tables) |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2016 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Segment Reporting [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Segment Reporting Information, by Segment | The following table presents segment information for the fiscal years ended:
(1) Refer to Note 22 - Supplemental Oil and Gas Information (Unaudited) for disclosures relating to non-cash charges to capitalized costs. (2) Asset inter-segment eliminations are primarily derived from investments in subsidiaries. The following table summarizes other significant items for the fiscal years ended:
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Commitments and Contingencies (Tables) |
12 Months Ended | ||||||||||||||||||||||||||||||||
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Jun. 30, 2016 | |||||||||||||||||||||||||||||||||
Commitments and Contingencies Disclosure [Abstract] | |||||||||||||||||||||||||||||||||
Schedule of Future Minimum Rental Commitments Under Non-Cancelable Operating Leases | The following table summarizes the Company's future minimum rental commitments under non-cancelable operating leases, net of guaranteed sublease income, as of June 30, 2016:
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Employee Retention and Severance Costs (Tables) |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2016 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Restructuring and Related Activities [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Restructuring and Related Costs | A reconciliation of the beginning and ending liability balance for charges to the consolidated statements of operations and cash payments is as follows for the fiscal years ended:
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Accumulated Other Comprehensive Income (Tables) |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2016 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Equity [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Accumulated Other Comprehensive Income | The following table represents the changes in components of accumulated other comprehensive income, net of tax, for the fiscal year ended:
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Pro Forma Financial Information (Tables) |
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Jun. 30, 2016 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Subsequent Events [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Unaudited Pro Forma Condensed Consolidated Balance Sheet |
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Unaudited Pro Forma Condensed Consolidated Statement of Operations |
MAGELLAN PETROLEUM CORPORATION UNAUDITED PRO FORMA CONSOLIDATED STATEMENT OF OPERATIONS FOR THE YEAR ENDED JUNE 30, 2015 (in thousands, except shares and per share amounts)
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Supplemental Oil and Gas Information (Unaudited) (Tables) |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2016 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Oil and Gas Exploration and Production Industries Disclosures [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Analysis of Changes in Proved Reserves | The following table sets forth information regarding the Company's estimated proved oil and gas reserve quantities, all of which are included in assets held for sale in the accompanying consolidated balance sheets as of June 30, 2016 and 2015. The Company emphasizes that reserve estimates are inherently imprecise and that estimates of new discoveries and undeveloped locations are more imprecise than estimates of established producing oil and gas properties. Accordingly, these estimates are expected to change as economic conditions change and new information becomes available.
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Standardized Measure of Oil and Gas - Prices | The following table summarizes the resulting prices used for proved reserves for the fiscal years ended:
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Standardized Measure of Oil and Gas - Discounted Future Cash Flows Relating to Proved Reserves Disclosure | The following table presents the standardized measure of discounted future net cash flows related to proved oil and gas reserves for the United States cost center only:
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Standardized Measure of Oil and Gas - Changes in Standardized Measure of Discounted Future Net Cash Flows | A summary of changes in the standardized measure of discounted future net cash flows is as follows:
(1) The increase in cash flows from the net change in income taxes in fiscal year 2015 represents the decrease in future income taxes as a result of the elimination of cash flows from PUD reserves. (2) For fiscal year 2016, there was an $11.0 million downward revision in reserve value due to the net change in prices and production costs. This change was the result of the steep decline in the WTI price, the benchmark oil price for sale of the Company's crude oil. (3) The downward revision of $5.8 million relates to the reduction of 643 Mbbls of proved developed non-producing reserves as a result of the elimination of the Company's workover program. |
Oil and Gas Activities (Unaudited) (Tables) |
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Jun. 30, 2016 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Oil and Gas Exploration and Production Industries Disclosures [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Cost Incurred in Oil and Gas Property Acquisition, Exploration, and Development Activities Disclosure | Costs incurred in oil and gas property acquisition, exploration, and development activities, whether capitalized or expensed, are summarized as follows:
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Schedule of Capitalized Costs of Unproved Properties Excluded from Amortization | The net changes in capitalized costs that are currently not being depleted pending the determination of proved reserves can be summarized as follows:
(1) On March 31, 2016, Magellan and One Stone entered into an Exchange Agreement that providing for, among other things, the transfer to the Company of 100% of the outstanding shares of Magellan Series A Preferred Stock in consideration for the assignment to and assumption by One Stone of 100% of the outstanding membership interests in Nautilus Poplar LLC. The transactions contemplated by the Exchange Agreement closed on August 1, 2016. (2) On June 10, 2016, Magellan entered into the Weald ATA for the sale of its interest in certain exploration licenses to UKOG. The transactions contemplated by the Weald ATA closed on August 11, 2016. (3) The Company reviewed the recoverability of the carrying values of its wells in progress to be transferred to One Stone in the Exchange, and as a result of this review recorded an impairment of $3.4 million to adjust the carrying value of wells in progress to their estimated fair values less costs to sell at June 30, 2016. (4) The Company reclassified the capitalized costs for two of the five CO2-enhanced oil recovery pilot wells from wells in progress to producing properties during the fourth quarter of fiscal 2015. |
Discontinued Operations - Summary of Asset Retirement Obligations Activity Included in Liabilities Held For Sale (Details) - USD ($) $ in Thousands |
12 Months Ended | |
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Jun. 30, 2016 |
Jun. 30, 2015 |
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Asset Retirement Obligation, Roll Forward Analysis [Roll Forward] | ||
Fiscal year opening balance | $ 0 | $ 397 |
Fiscal year closing balance | 0 | 0 |
Less current asset retirement obligations | 0 | 0 |
Long-term asset retirement obligations | 0 | 0 |
Liabilities Held For Sale | ||
Asset Retirement Obligation, Roll Forward Analysis [Roll Forward] | ||
Fiscal year opening balance | 2,647 | 2,476 |
Accretion expense | 171 | 171 |
Fiscal year closing balance | 2,818 | 2,647 |
Less current asset retirement obligations | 0 | 0 |
Long-term asset retirement obligations | $ 2,818 | $ 2,647 |
Securities Available-for-Sale (Details) £ in Thousands, $ in Thousands |
12 Months Ended | ||||
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Jun. 30, 2015
USD ($)
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Sep. 09, 2016
GBP (£)
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Aug. 11, 2016
GBP (£)
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Jun. 30, 2016
USD ($)
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Apr. 15, 2016
USD ($)
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Schedule of Available-for-sale Securities [Line Items] | |||||
Amortized cost | $ 4,230 | $ 885 | |||
Gross unrealized gains | 0 | 0 | |||
Gross unrealized losses | 0 | (284) | |||
Fair value | 4,230 | 601 | |||
Notes payable | 0 | $ 783 | |||
One Stone | Investor | One Stone Exchange Agreement | |||||
Schedule of Available-for-sale Securities [Line Items] | |||||
Notes payable | $ 625 | ||||
UKOG | UK Oil and Gas Investments | Subsidiary | Subsequent Event | Weald ATA, IoW ATA, and Settlement Agreement | |||||
Schedule of Available-for-sale Securities [Line Items] | |||||
Investment owned, value | £ | £ 958 | £ 703 | |||
Central Petroleum | |||||
Schedule of Available-for-sale Securities [Line Items] | |||||
Impairment on AFS securities | 14,900 | ||||
Other investment | |||||
Schedule of Available-for-sale Securities [Line Items] | |||||
Impairment on AFS securities | $ 171 |
Notes Payable (Details) - USD ($) $ in Thousands |
12 Months Ended | ||
---|---|---|---|
Apr. 15, 2016 |
Jun. 30, 2016 |
Jun. 30, 2015 |
|
Debt Instrument [Line Items] | |||
Note payable issued amount | $ 353 | ||
Basis spread on variable rate | 1.00% | ||
Interest rate during period | 4.50% | ||
Notes payable | $ 783 | $ 0 | |
Investor | One Stone Exchange Agreement | One Stone | |||
Debt Instrument [Line Items] | |||
Notes payable | $ 625 | ||
Minimum | |||
Debt Instrument [Line Items] | |||
Interest rate | 6.25% | ||
Amortization period of principal | 9 months | ||
Principal payment | $ 21 | ||
Maximum | |||
Debt Instrument [Line Items] | |||
Interest rate | 6.50% | ||
Amortization period of principal | 10 months | ||
Principal payment | $ 38 |
Notes Payable - Principal Payments (Details) - USD ($) $ in Thousands |
Jun. 30, 2016 |
Jun. 30, 2015 |
---|---|---|
Debt Disclosure [Abstract] | ||
Notes payable | $ 783 | $ 0 |
Total | $ 783 |
Asset Retirement Obligations (Details) - USD ($) $ in Thousands |
12 Months Ended | |
---|---|---|
Jun. 30, 2016 |
Jun. 30, 2015 |
|
Asset Retirement Obligation Disclosure [Abstract] | ||
Ownership percentage sold | 40.00% | |
Asset Retirement Obligation, Roll Forward Analysis [Roll Forward] | ||
Fiscal year opening balance | $ 0 | $ 397 |
Sale of assets | 0 | (346) |
Effect of exchange rate changes | 0 | (51) |
Fiscal year closing balance | 0 | 0 |
Less current asset retirement obligations | 0 | 0 |
Long-term asset retirement obligations | $ 0 | $ 0 |
Fair Value Measurements - Assets and Liabilities Carried at Fair Value by Classification Level in Valuation Hierarchy (Details) - Recurring - USD ($) |
Jun. 30, 2016 |
Jun. 30, 2015 |
---|---|---|
Assets: | ||
Securities available-for-sale | $ 601,000 | $ 4,230,000 |
Liabilities: | ||
Contingent consideration payable | 0 | 0 |
Level 1 | ||
Assets: | ||
Securities available-for-sale | 601,000 | 4,230,000 |
Liabilities: | ||
Contingent consideration payable | 0 | 0 |
Level 2 | ||
Assets: | ||
Securities available-for-sale | 0 | 0 |
Liabilities: | ||
Contingent consideration payable | 0 | 0 |
Level 3 | ||
Assets: | ||
Securities available-for-sale | 0 | 0 |
Liabilities: | ||
Contingent consideration payable | $ 0 | $ 0 |
Fair Value Measurements - Unobservable Input Reconciliation (Details) - USD ($) $ in Thousands |
12 Months Ended | |
---|---|---|
Jun. 30, 2016 |
Jun. 30, 2015 |
|
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||
Rolling production average | 60 days | |
Impairment of proved oil and gas properties | $ 17,400 | |
Impairment of goodwill | 674 | |
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | ||
Accretion expense | $ 0 | 36 |
Contingent consideration payable | Recurring | Level 3 | ||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | ||
Balance at beginning of year | 0 | 1,852 |
Accretion expense | 0 | 36 |
Revision to estimate | 0 | (1,888) |
Fiscal year closing balance | $ 0 | $ 0 |
Fair Value Measurements - Assets and Liabilities Measured on a Nonrecurring Basis (Details) - USD ($) $ in Thousands |
3 Months Ended | 12 Months Ended | ||
---|---|---|---|---|
Mar. 31, 2016 |
Mar. 31, 2016 |
Jun. 30, 2016 |
Jun. 30, 2015 |
|
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Impairment of proved oil and gas properties | $ 17,400 | |||
Exploration impairment cost | $ 0 | $ 20 | ||
One Stone Exchange Agreement | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Asset impairment charges | $ 11,300 | $ 11,300 | ||
Impairment of proved oil and gas properties | 7,800 | $ 7,800 | ||
Accounts receivable impairment charges | 100 | |||
Exploration impairment cost | $ 3,400 | $ 3,400 |
Income Taxes - Income Before Income Tax, Domestic and Foreign (Details) - USD ($) $ in Thousands |
12 Months Ended | |
---|---|---|
Jun. 30, 2016 |
Jun. 30, 2015 |
|
Net Income (Loss) Before Income Taxes | ||
United States | $ (4,454) | $ (4,371) |
Net loss from continuing operations | (3,328) | (21,596) |
Australia | ||
Net Income (Loss) Before Income Taxes | ||
Foreign | 1,497 | (16,146) |
United Kingdom | ||
Net Income (Loss) Before Income Taxes | ||
Foreign | $ (371) | $ (1,079) |
Income Taxes - Income Tax Rate Reconciliation (Details) - USD ($) $ in Thousands |
12 Months Ended | |
---|---|---|
Jun. 30, 2016 |
Jun. 30, 2015 |
|
Income Tax Disclosure [Abstract] | ||
Tax provision computed per federal statutory rate | $ (1,131) | $ (7,343) |
State taxes, net of federal benefit | (91) | (153) |
Foreign rate differential | (8) | 908 |
Accounting Principles Board 23 adjustment | 0 | 9,632 |
Change in valuation allowance | (668) | (5,254) |
Foreign tax credit adjustment | 0 | (310) |
Capital loss adjustment | 179 | 1,493 |
Impact of rate change | 47 | 159 |
Foreign currency translation differential | 838 | 1,255 |
Stock-based compensation forfeitures | 621 | 545 |
Contingent consideration payable write-off | 0 | (630) |
Other items | 213 | (302) |
Consolidated income tax expense (benefit) | $ 0 | $ 0 |
Income Taxes - Components of Income Tax Provision (Details) - USD ($) $ in Thousands |
12 Months Ended | |
---|---|---|
Jun. 30, 2016 |
Jun. 30, 2015 |
|
Income Tax Disclosure [Abstract] | ||
Consolidated current income tax provision | $ 0 | $ 0 |
Consolidated deferred income tax provision | 0 | 0 |
Consolidated income tax expense (benefit) | 0 | 0 |
Continuing operations | 0 | 0 |
Discontinued operations | $ 0 | $ 0 |
Effective tax rate for continuing operations | 0.00% | 0.00% |
Income Taxes - Deferred Tax Assets and Liabilities (Details) - USD ($) $ in Thousands |
Jun. 30, 2016 |
Jun. 30, 2015 |
---|---|---|
Deferred tax liabilities | ||
Land, buildings and equipment | $ 0 | $ 0 |
Foreign investments | (10,851) | (7,451) |
Other items | (72) | (128) |
Total deferred tax liabilities | (10,923) | (7,579) |
Deferred tax assets | ||
Acquisition and development costs | (21) | (5) |
Asset retirement obligations | 0 | 0 |
Net operating losses, capital losses, and foreign tax credit carry forwards | 21,408 | 18,521 |
United Kingdom exploration costs and net operating losses | 3,109 | 3,639 |
Investments | 111 | 100 |
Stock option compensation | 1,810 | 2,184 |
Australian capitalized legal costs | 112 | 116 |
Other items | 286 | 141 |
Total deferred tax asset | 26,815 | 24,696 |
Valuation allowance | (15,892) | (17,117) |
Net long term deferred tax asset | $ 0 | $ 0 |
Income Taxes - Additional Information (Details) - USD ($) |
12 Months Ended | |
---|---|---|
Jun. 30, 2016 |
Jun. 30, 2015 |
|
Valuation Allowance [Line Items] | ||
Decrease in valuation allowance | $ 1,200,000 | |
Deferred tax asset, net of tax liability related to basis difference in foreign subsidiaries | 7,000,000 | |
Basis difference in foreign subsidiaries | 11,600,000 | |
Income tax expense | 0 | $ 0 |
Deferred tax assets | 0 | |
Uncertain tax positions | 0 | $ 0 |
Federal | ||
Valuation Allowance [Line Items] | ||
Tax deduction from compensation expense | $ 252,000 |
Stock Based Compensation - Stock Option Activity (Details) - $ / shares |
12 Months Ended | |
---|---|---|
Jun. 30, 2016 |
Jun. 30, 2015 |
|
Number of Shares | ||
Balance at beginning of year (in shares) | 1,032,334 | 1,311,528 |
Granted (in shares) | 0 | 223,123 |
Exercised (in shares) | 0 | (61,849) |
Forfeited (in shares) | (13,958) | (427,969) |
Expired (in shares) | (291,403) | (12,499) |
Balance at end of year (in shares) | 726,973 | 1,032,334 |
WAEPS | ||
Weighted Average Exercise Price, Balance at beginning of year (in dollar per share) | $ 11.15 | $ 10.08 |
Weighted Average Exercise Price, Granted (in dollar per share) | 0.00 | 13.83 |
Weighted Average Exercise Price, Exercised (in dollar per share) | 0.00 | 8.74 |
Weighted Average Exercise Price, Forfeited (in dollar per share) | 7.60 | 9.68 |
Weighted Average Exercise Price, Expired (in dollars per share) | 10.91 | 8.90 |
Weighted Average Exercise Price, Balance at end of year (in dollar per share) | $ 11.32 | $ 11.15 |
Weighted average remaining contractual term (in years) | 6 years 2 months 5 days | 5 years 6 months 22 days |
Stock Based Compensation - Stock Compensation Expense (Details) - USD ($) $ in Thousands |
12 Months Ended | |
---|---|---|
Jun. 30, 2016 |
Jun. 30, 2015 |
|
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Share-based compensation expense | $ 701 | $ 891 |
Unrecognized stock compensation expense related to options granted | $ 275 | |
Weighted average cost recognition period | 1 year 4 months 24 days | |
Additional options expected to vest | 7,292 | |
Selling, General and Administrative Expenses | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Share-based compensation expense | $ 742 |
Preferred Stock - Preferred Stock Rollforward (Details) - USD ($) $ in Thousands |
12 Months Ended | |
---|---|---|
Jun. 30, 2016 |
Jun. 30, 2015 |
|
Amount | ||
Fiscal year opening balance | $ 25,850 | |
Current year PIK dividends shares issued | 1,858 | $ 1,311 |
Adjustment to redemption value | (4,207) | 0 |
Fiscal year closing balance | $ 23,501 | $ 25,850 |
Series A Preferred Stock | ||
Number of shares issued | ||
Fiscal year opening balance | 21,162,697 | 20,089,436 |
Current year PIK dividends shares issued | 1,520,731 | 1,073,261 |
Fiscal year closing balance | 22,683,428 | 21,162,697 |
Amount | ||
Fiscal year opening balance | $ 25,850 | $ 24,539 |
Current year PIK dividends shares issued | 1,858 | 1,311 |
Fiscal year closing balance | $ 23,501 | $ 25,850 |
Stockholders' (Deficit) Equity Reverse Stock Split (Details) |
12 Months Ended | |||||
---|---|---|---|---|---|---|
Jul. 10, 2015
shares
|
May 17, 2013 |
Jun. 30, 2016
shares
|
Jul. 11, 2015
shares
|
Jun. 30, 2015
shares
|
Jun. 30, 2014
shares
|
|
Class of Stock [Line Items] | ||||||
Common stock, issued (in shares) | 6,972,023 | 6,917,027 | ||||
Treasury stock, (in shares) | 9,675,114 | 1,209,389 | 1,209,389 | 1,209,389 | 1,178,139 | |
Reverse stock split (usd per share) | 0.125 | 0.125 | ||||
Common Stock | ||||||
Class of Stock [Line Items] | ||||||
Common stock, issued (in shares) | 55,313,647 | 6,911,921 | ||||
Series A Preferred Stock | ||||||
Class of Stock [Line Items] | ||||||
Reverse stock split (usd per share) | 9.77586545 |
Stockholders' (Deficit) Equity Retired Warrant (Details) - USD ($) |
12 Months Ended | |||
---|---|---|---|---|
Jan. 14, 2013 |
Jun. 30, 2016 |
Jun. 30, 2015 |
Jun. 30, 2014 |
|
Class of Stock [Line Items] | ||||
Exercise price (usd per share) | $ 11.32 | $ 11.15 | $ 10.08 | |
Retired Warrant | ||||
Class of Stock [Line Items] | ||||
Payments for repurchase of warrants | $ 800,000 | |||
Redemption price (usd per share) | 7.20 | |||
Exercise price (usd per share) | $ 9.20 | |||
Expected dividend | $ 0 | |||
Risk free interest rate | 0.20% | |||
Expected life (years) | 1 year 6 months | |||
Expected volatility (based on historical price) | 60.80% |
Loss Per Share - Schedule of Antidilutive Securities (Details) - shares |
12 Months Ended | |
---|---|---|
Jun. 30, 2016 |
Jun. 30, 2015 |
|
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Potentially dilutive securities | 2,714,503 | 2,570,985 |
In-the-money stock options | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Potentially dilutive securities | 0 | 27,673 |
Series A Preferred Stock | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Potentially dilutive securities | 2,714,503 | 2,543,312 |
Commitments and Contingencies - Operating Leases (Details) $ in Thousands |
Jun. 30, 2016
USD ($)
|
---|---|
Amounts payable in fiscal year: | |
2017 | $ 175 |
2018 | 74 |
Total | $ 249 |
Commitments and Contingencies - Engagement of RFC Ambrian (Details) - Engagement of RFC Ambrian as financial advisor for farmout of NT/P82 $ in Thousands |
1 Months Ended |
---|---|
Jul. 31, 2015
USD ($)
| |
Loss Contingencies [Line Items] | |
Ownership percentage | 100.00% |
Cash payment for first initial stage | $ 20 |
Cash payment for second initial stage | 80 |
Contingent fees | $ 250 |
Contingent fees, percentage of transaction | 5.00% |
Percentage interest in potential contingent consideration | 5.00% |
Related Party Transactions (Details) $ in Thousands |
12 Months Ended | 19 Months Ended | ||
---|---|---|---|---|
Mar. 31, 2016 |
Jun. 30, 2016
USD ($)
|
Jun. 30, 2015
USD ($)
|
Jun. 30, 2016
AUD
|
|
Nautilus Poplar, LLC (NP) | ||||
Related Party Transaction [Line Items] | ||||
Ownership percentage, sold in period | 100.00% | |||
Series A Preferred Stock | ||||
Related Party Transaction [Line Items] | ||||
Percent of shares transferred | 100.00% | |||
One Stone Exchange Agreement | Nautilus Poplar, LLC (NP) | ||||
Related Party Transaction [Line Items] | ||||
Ownership percentage, sold in period | 100.00% | |||
Devizes International Consulting Limited | Affiliated Entity | ||||
Related Party Transaction [Line Items] | ||||
Amount of transaction | $ 59 | $ 147 | ||
MPA | Compensation Arrangement | Director | ||||
Related Party Transaction [Line Items] | ||||
Amount of transaction | AUD | AUD 5,400 | |||
Mi3 | Compensation Arrangement | Affiliated Entity | ||||
Related Party Transaction [Line Items] | ||||
Amount of transaction | $ 293 | $ 1,100 |
Accumulated Other Comprehensive Income (Details) $ in Thousands |
12 Months Ended |
---|---|
Jun. 30, 2016
USD ($)
| |
Accumulated Other Comprehensive Income (Loss) [Line Items] | |
Fiscal year opening balance | $ 5,302 |
Other comprehensive loss | (390) |
Net current period other comprehensive loss | (390) |
Fiscal year ending balance | 4,912 |
Accumulated Translation Adjustment | |
Accumulated Other Comprehensive Income (Loss) [Line Items] | |
Fiscal year opening balance | 5,302 |
Other comprehensive loss | (125) |
Net current period other comprehensive loss | (125) |
Fiscal year ending balance | 5,177 |
Unrealized investment holding loss | |
Accumulated Other Comprehensive Income (Loss) [Line Items] | |
Fiscal year opening balance | 0 |
Other comprehensive loss | (265) |
Net current period other comprehensive loss | (265) |
Fiscal year ending balance | $ (265) |
Pro Forma Financial Information - Narrative (Details) £ in Thousands, $ in Thousands, shares in Millions |
Aug. 11, 2016
GBP (£)
shares
|
Aug. 01, 2016
USD ($)
|
Jun. 30, 2016
USD ($)
|
Apr. 15, 2016
USD ($)
|
Jun. 30, 2015
USD ($)
|
---|---|---|---|---|---|
Subsequent Event [Line Items] | |||||
Notes payable | $ 783 | $ 0 | |||
Subsequent Event | UK Oil and Gas Investments | Weald ATA, IoW ATA, and Settlement Agreement | |||||
Subsequent Event [Line Items] | |||||
Investment owned (in shares) | shares | 50.9 | ||||
One Stone | One Stone Exchange Agreement | Investor | |||||
Subsequent Event [Line Items] | |||||
Notes payable | $ 625 | ||||
One Stone | One Stone Exchange Agreement | Investor | Subsequent Event | |||||
Subsequent Event [Line Items] | |||||
Amount due from related party | $ 900 | ||||
Amount of transaction | $ 467 | ||||
Celtique Litigation | Subsequent Event | |||||
Subsequent Event [Line Items] | |||||
Litigation settlement, amount | £ | £ 500 |
Supplemental Oil and Gas Information (Unaudited) - Proved Reserves Quantities (Details) - MBbls |
12 Months Ended | ||
---|---|---|---|
Jun. 30, 2016 |
Jun. 30, 2015 |
Jun. 30, 2014 |
|
Proved Developed and Undeveloped Reserves [Abstract] | |||
Revision of previous estimates | (1,284) | (3,417,000) | |
Adjustment due to suspension of the Company's workover program | (643) | ||
Removal proved undeveloped reserves from the classification of proved reserves due to uncertainty | 3,083,000 | ||
Oil (in Mbbls) | |||
Proved Developed and Undeveloped Reserves [Abstract] | |||
Adjustment due to suspension of the Company's workover program | (643) | ||
United States | Oil (in Mbbls) | |||
Proved Developed and Undeveloped Reserves [Abstract] | |||
Beginning Balance | 2,239,600 | 5,735,700 | |
Revision of previous estimates | (1,284,400) | (3,417,100) | |
Production | (60,200) | (79,000) | |
Ending Balance | 895,000 | 2,239,600 | |
Proved developed reserves | 895,000 | 2,239,600 | |
Proved undeveloped reserves (volume) | 0 | 0 |
Supplemental Oil and Gas Information (Unaudited) - Proved Oil and Gas Quantities (Details) - $ / bbl |
12 Months Ended | |
---|---|---|
Jun. 30, 2016 |
Jun. 30, 2015 |
|
Oil | ||
Average Sales Price and Production Costs Per Unit of Production [Line Items] | ||
Average sales prices (in usd per bbl) | 34.11 | 58.93 |
Supplemental Oil and Gas Information (Unaudited) - Discounted Future Net Cash Flows (Details) - USD ($) $ in Thousands |
12 Months Ended | ||
---|---|---|---|
Jun. 30, 2016 |
Jun. 30, 2015 |
Jun. 30, 2014 |
|
Discounted Future Net Cash Flows Relating to Proved Oil and Gas Reserves [Line Items] | |||
Discount rate | 10.00% | ||
United States | |||
Discounted Future Net Cash Flows Relating to Proved Oil and Gas Reserves [Line Items] | |||
Future cash inflows | $ 30,527 | $ 131,979 | |
Future production costs | (22,366) | (85,372) | |
Future development costs | (1,463) | (7,021) | |
Future income tax expense | 0 | 0 | |
Future net cash flows | 6,698 | 39,586 | |
10% annual discount | (4,111) | (22,569) | |
Standardized measures of discounted future net cash flows | $ 2,587 | $ 17,017 | $ 87,043 |
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