Divestitures

3 Months Ended

Mar. 31, 2022

Property, Plant and Equipment Impairment or Disposal [Abstract]

Divestitures

DIVESTITURES

Oil and Natural Gas

The company initiated an asset divestiture program at the beginning of 2021 to sell certain non-core oil and gas properties and reserves (the “Divestiture Program”). On October 4, 2021, the company announced that it is expanding the Divestiture Program to now include the potential sale of additional properties, including up to all of UPC’s oil and gas properties and reserves. On January 20, 2022, the company announced that it has retained a financial advisor and launched the process, which is still ongoing.

On March 8, 2022, the company closed on the sale of certain non-core wells and related leases located near the Oklahoma Panhandle for cash proceeds of $4.1 million net of customary closing and post-closing adjustments based on an effective date of December 1, 2021. These proceeds reduced the net book value of our full cost pool with no gain or loss recognized as the sale did not result in a significant alteration of the full cost pool.

We sold other non-core oil and natural gas assets for net proceeds of $0.5 million and $1.7 million during the three months ended March 31, 2022 and 2021, respectively. These proceeds reduced the net book value of our full cost pool with no gain or loss recognized as the sales did not result in a significant alteration of the full cost pool.

Contract Drilling

We sold non-core contract drilling assets for proceeds of $2.2 million and $2.0 million during the three months ended March 31, 2022 and 2021, respectively. These proceeds resulted in net gains of $2.1 million and 0.6 million during the three months ended March 31, 2022 and 2021, respectively.