Divestitures

6 Months Ended

Jun. 30, 2021

Property, Plant and Equipment Impairment or Disposal [Abstract]

Divestitures

DIVESTITURES

Oil and Natural Gas

On June 25, 2021, the company entered into a purchase and sale agreement to which we agreed to sell substantially all of our wells and the leases related thereto located near Oklahoma City, Oklahoma for $19.5 million, subject to customary closing and post-closing adjustments. The divestiture closed on August 16, 2021, with an effective date of May 1, 2021. The sale of these assets will not result in a significant alteration of the full cost pool, and therefore no gain or loss will be recognized.

On March 30, 2021, the company entered into a purchase and sale agreement to which we agreed to sell substantially all of our wells and the leases related thereto located in Reno and Stafford Counties, Kansas for $7.1 million, subject to customary closing and post-closing adjustments. This divestiture closed on May 6, 2021, with an effective date of February 1, 2021. The sale of these assets did not result in a significant alteration of the full cost pool, and therefore no gain or loss was recognized.

We sold $4.4 million of other non-core oil and natural gas assets, net of related expenses, during the six months ended June 30, 2021, compared to $0.9 million during the six months ended June 30, 2020. These proceeds reduced the net book value of our full cost pool with no gain or loss recognized.

Contract Drilling

We sold non-core contract drilling assets for proceeds of $3.9 million, net of related expenses, during the six months ended June 30, 2021, compared to proceeds of $2.8 million during the six months ended June 30, 2020. These proceeds resulted in net gains of $2.1 million during the six months ended June 30, 2021, compared to $0.1 million during the six months ended June 30, 2020.

Corporate and Other

The company entered into a purchase and sale agreement to which we agreed to sell our corporate headquarters building and land with an anticipated closing date during the third quarter of 2021. The agreement remains subject to customary closing conditions. If the transaction closes, we plan to enter a multi-year lease for a portion of the building and no material gain or loss is expected.