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Investment in Laramie Energy, LLC
 6 Months Ended
Jun. 30, 2017
Equity Method Investments and Joint Ventures [Abstract]  
Investment in Laramie Energy, LLC
Investment in Laramie Energy, LLC
We have a 42.3% ownership interest in Laramie Energy. Laramie Energy is focused on producing natural gas in Garfield, Mesa, and Rio Blanco Counties, Colorado. We acquired our equity interest in Laramie Energy as a result of (1) the contribution of certain natural gas and oil interests to Laramie Energy in conjunction with our corporate reorganization in August 2012 and (2) cash contributions of $27.5 million in 2015 and $55.0 million in 2016.
Laramie Energy has a $400 million revolving credit facility with a borrowing base currently set at $210 million that is secured by a lien on its natural gas and crude oil properties and related assets. As of June 30, 2017, the balance outstanding on the revolving credit facility was approximately $131 million. We are guarantors of Laramie Energy’s credit facility, with recourse limited to the pledge of our equity interest of our wholly owned subsidiary, Par Piceance Energy Equity, LLC. Under the terms of its credit facility, Laramie Energy is generally prohibited from making future cash distributions to its owners, including us.
The change in our equity investment in Laramie Energy is as follows (in thousands):
 
Six Months Ended June 30, 2017
Beginning balance
$
108,823

Equity earnings from Laramie Energy
8,436

Accretion of basis difference
2,662

Ending balance
$
119,921


Summarized financial information for Laramie Energy is as follows (in thousands):
 
June 30, 2017
 
December 31, 2016
Current assets
$
10,865

 
$
12,199

Non-current assets
667,583

 
655,022

Current liabilities
39,909

 
58,067

Non-current liabilities
192,737

 
186,631

 
Three Months Ended June 30,
 
Six Months Ended June 30,
 
2017
 
2016
 
2017
 
2016
Natural gas and oil revenues
$
35,425

 
$
22,729

 
$
76,037

 
$
37,422

Loss from operations
(1,458
)
 
(12,229
)
 
(295
)
 
(23,353
)
Net income (loss)
2,412

 
(43,660
)
 
19,940

 
(46,239
)

Laramie Energy's net income for the three and six months ended June 30, 2017 includes $12.5 million and $25.8 million of depreciation, depletion, and amortization (“DD&A”) and $8.7 million and $32.9 million of unrealized gain on derivative instruments, respectively. Laramie Energy’s net loss for the three and six months ended June 30, 2016 includes $13.0 million and $20.6 million of DD&A and $35.4 million and $29.5 million of unrealized losses on derivative instruments, respectively.
At June 30, 2017 and December 31, 2016, our equity in the underlying net assets of Laramie Energy exceeded the carrying value of our investment by approximately $65.1 million and $67.8 million, respectively. This difference arose due to lack of control and marketability discounts and an other-than-temporary impairment of our equity investment in Laramie Energy in 2015. We attributed this difference to natural gas and crude oil properties and are amortizing the difference over 15 years based on the estimated timing of production of proved reserves.