INDUSTRY SEGMENT INFORMATION

We have three main business segments offering different products and services within the energy industry:


•	Oil and natural gas,


•	Contract drilling, and


•	Mid-stream

Our oil and natural gas segment is engaged in the acquisition, development, and production of oil, NGLs, and natural gas properties. The contract drilling segment is engaged in the land contract drilling of oil and natural gas wells and the mid-stream segment is engaged in the buying, selling, gathering, processing, and treating of natural gas and NGLs.

We evaluate each segment’s performance based on its operating income, which is defined as operating revenues less operating expenses and depreciation, depletion, amortization, and impairment. We have no oil and natural gas production outside the United States.

The following tables provide certain information about the operations of each of our segments:



	Three Months Ended September 30, 2018
	Oil and Natural Gas			Contract Drilling			Mid-stream			Other			Eliminations			Total Consolidated
	(In thousands)
Revenues: ⁽¹⁾
Oil and natural gas	$	111,623		$	—		$	—		$	—		$	—		$	111,623
Contract drilling	—			58,012			—			—			(7,400		)	50,612
Gas gathering and processing	—			—			82,882			—			(25,059		)	57,823
Total revenues	111,623			58,012			82,882			—			(32,459		)	220,058
Expenses:
Operating costs:
Oil and natural gas	33,400			—			—			—			(1,261		)	32,139
Contract drilling	—			38,246			—			—			(6,214		)	32,032
Gas gathering and processing	—			—			66,932			3,808			(27,606		)	43,134
Total operating costs	33,400			38,246			66,932			3,808			(35,081		)	107,305
Depreciation, depletion, and amortization	35,460			14,889			11,265			1,923			—			63,537
Total expenses	68,860			53,135			78,197			5,731			(35,081		)	170,842
General and administrative	—			—			—			9,278			—			9,278
Gain on disposition of assets	(7		)	(230		)	(16		)	—			—			(253		)
Income (loss) from operations	42,770			5,107			4,701			(15,009		)	2,622			40,191
Loss on derivatives	—			—			—			(4,385		)	—			(4,385		)
Interest, net	—			—			(381		)	(7,564		)	—			(7,945		)
Other	—			—			—			3,814			(3,808		)	6
Income (loss) before income taxes	$	42,770		$	5,107		$	4,320		$	(23,144	)	$	(1,186	)	$	27,867

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(1)	The revenues for oil and natural gas occur at a point in time. The revenues for contract drilling and gas gathering and processing occur over time.



	Three Months Ended September 30, 2017
	Oil and Natural Gas		Contract Drilling			Mid-stream			Other			Eliminations			Total Consolidated
	(In thousands)
Revenues:
Oil and natural gas	$	85,470	$	—		$	—		$	—		$	—		$	85,470
Contract drilling	—		55,588			—			—			(3,969		)	51,619
Gas gathering and processing	—		—			69,057			—			(17,658		)	51,399
Total revenues	85,470		55,588			69,057			—			(21,627		)	188,488
Expenses:
Operating costs:
Oil and natural gas	35,082		—			—			—			(1,171		)	33,911
Contract drilling	—		38,115			—			—			(3,368		)	34,747
Gas gathering and processing	—		—			54,602			—			(16,486		)	38,116
Total operating costs	35,082		38,115			54,602			—			(21,025		)	106,774
Depreciation, depletion, and amortization	26,460		15,280			10,880			1,913			—			54,533
Total expenses	61,542		53,395			65,482			1,913			(21,025		)	161,307
General and administrative expense	—		—			—			9,235			—			9,235
(Gain) loss on disposition of assets	1		(68		)	(14		)	—			—			(81		)
Income (loss) from operations	23,927		2,261			3,589			(11,148		)	(602		)	18,027
Loss on derivatives	—		—			—			(2,614		)	—			(2,614		)
Interest, net	—		—			—			(9,944		)	—			(9,944		)
Other	—		—			—			5			—			5
Income (loss) before income taxes	$	23,927	$	2,261		$	3,589		$	(23,701	)	$	(602	)	$	5,474



	Nine Months Ended September 30, 2018
	Oil and Natural Gas			Contract Drilling			Mid-stream			Other			Eliminations			Total Consolidated
	(In thousands)
Revenues: ⁽¹⁾
Oil and natural gas	$	317,040		$	—		$	—		$	—		$	—		$	317,040
Contract drilling	—			161,489			—			—			(17,962		)	143,527
Gas gathering and processing	—			—			232,938			—			(65,012		)	167,926
Total revenues	317,040			161,489			232,938			—			(82,974		)	628,493
Expenses:
Operating costs:
Oil and natural gas	104,234			—			—			—			(3,715		)	100,519
Contract drilling	—			111,121			—			—			(15,528		)	95,593
Gas gathering and processing	—			—			185,738			7,384			(68,681		)	124,441
Total operating costs	104,234			111,121			185,738			7,384			(87,924		)	320,553
Depreciation, depletion, and amortization	97,797			41,927			33,493			5,759			—			178,976
Total expenses	202,031			153,048			219,231			13,143			(87,924		)	499,529
General and administrative expense	—			—			—			28,752			—			28,752
Gain on disposition of assets	(136		)	(314		)	(95		)	(30		)	—			(575		)
Income (loss) from operations	115,145			8,755			13,802			(41,865		)	4,950			100,787
Loss on derivatives	—			—			—			(25,608		)	—			(25,608		)
Interest, net	—			—			(834		)	(24,844		)	—			(25,678		)
Other	—			—			—			7,401			(7,384		)	17
Income (loss) before income taxes	$	115,145		$	8,755		$	12,968		$	(84,916	)	$	(2,434	)	$	49,518

_______________________


(1)	The revenues for oil and natural gas occur at a point in time. The revenues for contract drilling and gas gathering and processing occur over time.



	Nine Months Ended September 30, 2017
	Oil and Natural Gas			Contract Drilling			Mid-stream			Other			Eliminations			Total Consolidated
	(In thousands)
Revenues:
Oil and natural gas	$	256,241		$	—		$	—		$	—		$	—		$	256,241
Contract drilling	—			137,617			—			—			(9,558		)	128,059
Gas gathering and processing	—			—			198,632			—			(48,139		)	150,493
Total revenues	256,241			137,617			198,632			—			(57,697		)	534,793
Expenses:
Operating costs:
Oil and natural gas	99,349			—			—			—			(3,476		)	95,873
Contract drilling	—			99,794			—			—			(8,581		)	91,213
Gas gathering and processing	—			—			156,525			—			(44,663		)	111,862
Total operating costs	99,349			99,794			156,525			—			(56,720		)	298,948
Depreciation, depletion, and amortization	71,544			41,896			32,547			5,558			—			151,545
Total expenses	170,893			141,690			189,072			5,558			(56,720		)	450,493
General and administrative expense	—			—			—			26,902			—			26,902
Gain on disposition of assets	(176		)	(106		)	(58		)	(813		)	—			(1,153		)
Income (loss) from operations	85,524			(3,967		)	9,618			(31,647		)	(977		)	58,551
Gain on derivatives	—			—			—			21,019			—			21,019
Interest, net	—			—			—			(28,807		)	—			(28,807		)
Other	—			—			—			14			—			14
Income (loss) before income taxes	$	85,524		$	(3,967	)	$	9,618		$	(39,421	)	$	(977	)	$	50,777