Subsequent Events (Notes)

3 Months Ended

Mar. 31, 2020

Subsequent Events [Abstract]

Subsequent Events [Text Block]

Subsequent Events

In March 2020, the World Health Organization declared a global pandemic related to the proliferation of COVID-19 (novel coronavirus). The adverse economic effects of the COVID-19 pandemic continue to evolve as of the filing of this report. The catastrophe caused by the COVID-19 pandemic has materially decreased global and domestic demand for crude oil based on changes in consumer behavior and restrictions implemented by governments to mitigate the pandemic. This destruction of

demand has led to an unprecedented decline in crude oil prices. In response to these developments, the Company began shutting in production in April 2020 and currently has approximately 70% of its operated crude oil production and associated natural gas shut-in. The duration and extent of our production shut-ins are being evaluated on an ongoing basis and are subject to change as market conditions evolve. Given the uncertain duration of the catastrophe caused by the COVID-19 pandemic and the potential for a longer-term impact on consumer behaviors, the Company is not able to estimate the effects of the pandemic on its results of operations, financial condition, or cash flows for the remainder of 2020. Nevertheless, a near term material negative impact on the Company's production, revenues, cash flows, and earnings is certain to occur for the second quarter of 2020.

On April 15, 2020, Casillas Petroleum Resource Partners II, LLC filed a petition against the Company in the District Court of Tulsa County, State of Oklahoma. In its petition Casillas alleges the Company breached a Purchase and Sale Agreement (“PSA”) to purchase oil and gas interests in Oklahoma for $200 million. Casillas seeks specific performance.  The Company terminated the PSA due to Casillas’ breach of the agreement and denies the allegations and will vigorously defend the claims.  The Company will also seek affirmative relief. The Company is not currently able to estimate what impact, if any, the ultimate resolution of the action will have on its financial condition, results of operations, or cash flows due to the preliminary status of the matter.

In April 2020, the Company repurchased and canceled an additional $17.0 million face value of its 2023 Notes at an aggregate cost of $9.8 million and an additional $82.0 million face value of its 2024 Notes at an aggregate cost of $43.1 million, in each case, including accrued and unpaid interest to the repurchase dates. The Company estimates it will recognize pre-tax gains on extinguishment of debt related to the April 2020 repurchases totaling $47.0 million, which include the pro-rata write-off of deferred financing costs and unamortized debt discount associated with the notes. The reduction in debt and associated extinguishment gains from the April 2020 repurchases will be reflected in the Company's second quarter 2020 results.