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Share Name | Share Symbol | Market | Type |
---|---|---|---|
Abraxas Petroleum Corporation (CE) | USOTC:AXAS | OTCMarkets | Common Stock |
Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
---|---|---|---|---|---|---|---|---|---|---|
0.00 | 0.00% | 0.0347 | 0.00 | 01:00:00 |
|
ý
|
|
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 FOR THE QUARTERLY PERIOD ENDED JUNE 30, 2014
|
o
|
|
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 FOR THE TRANSITION PERIOD FROM ______ TO ______
|
Nevada
|
|
74-2584033
|
(State of Incorporation)
|
|
(I.R.S. Employer Identification No.)
|
18803 Meisner Drive, San Antonio, TX 78258
|
(Address of principal executive offices) (Zip Code)
|
|
210-490-4788
|
(Registrant’s telephone number, including area code)
|
|
Not Applicable
|
(Former name, former address and former fiscal year, if changed since last report)
|
|
Large accelerated filer
o
|
Accelerated filer
x
|
Non-accelerated filer
o
(Do not mark if a smaller reporting company)
|
Smaller reporting company
o
|
•
|
the availability of capital;
|
•
|
the prices we receive for our production and the effectiveness of our hedging activities;
|
•
|
our success in development, exploitation and exploration activities;
|
•
|
our ability to procure services and equipment for our drilling and completion activities;
|
•
|
our ability to make planned capital expenditures;
|
•
|
declines in our production of oil and gas;
|
•
|
our restrictive debt covenants;
|
•
|
political and economic conditions in oil producing countries, especially those in the Middle East;
|
•
|
price and availability of alternative fuels;
|
•
|
our acquisition and divestiture activities;
|
•
|
weather conditions and events;
|
•
|
the proximity, capacity, cost and availability of pipelines and other transportation facilities; and
|
•
|
other factors discussed elsewhere in this report
|
PART I
|
|||
FINANCIAL INFORMATION
|
|||
|
|
|
|
ITEM 1 -
|
Financial Statements
|
|
|
|
Condensed Consolidated Balance Sheets -
June 30, 2014 (unaudited) and December 31, 2013
|
||
|
Condensed Consolidated Statements of Operations – (unaudited)
Three and Six Months Ended June 30, 2014 and 2013 |
||
|
Condensed Consolidated Statements of Other Comprehensive Income (Loss) – (unaudited)
Three and Six Months Ended June 30, 2014 and 2013 |
||
|
Condensed Consolidated Statements of Cash Flows – (unaudited)
Six Months Ended June 30, 2014 and 2013 |
||
|
Notes to Condensed Consolidated Financial Statements - (unaudited)
|
||
|
|
|
|
ITEM 2 -
|
Management's Discussion and Analysis of Financial Condition and
Results of Operations |
||
|
|
|
|
ITEM 3 -
|
Quantitative and Qualitative Disclosures about Market Risk
|
||
|
|
|
|
ITEM 4 -
|
Controls and Procedures
|
||
|
|
|
|
PART II
|
|||
OTHER INFORMATION
|
|||
|
|||
ITEM 1 -
|
Legal Proceedings
|
||
ITEM 1A -
|
Risk Factors
|
||
ITEM 2 -
|
Unregistered Sales of Equity Securities and Use of Proceeds
|
||
ITEM 3 -
|
Defaults Upon Senior Securities
|
||
ITEM 4 -
|
Mine Safety Disclosure
|
||
ITEM 5 -
|
Other Information
|
||
ITEM 6 -
|
Exhibits
|
||
|
Signatures
|
||
|
|
|
|
|
June 30,
2014 (Unaudited) |
|
December 31,
2013
|
|
||||
Assets
|
|
|
|
|
|
||||
Current assets:
|
|
|
|
|
|
||||
Cash and cash equivalents
|
|
$
|
3,742
|
|
|
$
|
5,205
|
|
|
Accounts receivable, net:
|
|
|
|
|
|
|
|
||
Joint owners
|
|
5,299
|
|
|
15,493
|
|
|
||
Oil and gas production
|
|
22,572
|
|
|
16,625
|
|
|
||
Other
|
|
980
|
|
|
1,497
|
|
|
||
|
|
28,851
|
|
|
33,615
|
|
|
||
|
|
|
|
|
|
||||
Derivative asset – current
|
|
113
|
|
|
85
|
|
|
||
Other current assets
|
|
362
|
|
|
644
|
|
|
||
Total current assets
|
|
33,068
|
|
|
39,549
|
|
|
||
|
|
|
|
|
|
||||
Property and equipment:
|
|
|
|
|
|
|
|
||
Oil and gas properties, full cost method of accounting:
|
|
|
|
|
|
|
|
||
Proved
|
|
652,158
|
|
|
564,755
|
|
|
||
Other property and equipment
|
|
39,213
|
|
|
38,959
|
|
|
||
Total
|
|
691,371
|
|
|
603,714
|
|
|
||
Less accumulated depreciation, depletion, and amortization
|
|
(440,322
|
)
|
|
(423,069
|
)
|
|
||
Total property and equipment – net
|
|
251,049
|
|
|
180,645
|
|
|
||
|
|
|
|
|
|
||||
|
|
|
|
|
|
||||
Deferred financing fees, net
|
|
2,366
|
|
|
2,140
|
|
|
||
Derivative asset – long-term
|
|
—
|
|
|
925
|
|
|
||
Other assets
|
|
391
|
|
|
391
|
|
|
||
Total assets
|
|
$
|
286,874
|
|
|
$
|
223,650
|
|
|
|
|
June 30,
2014 (Unaudited) |
|
December 31,
2013
|
|
||||
Liabilities and Stockholders’ Equity
|
|
|
|
|
|
||||
Current liabilities:
|
|
|
|
|
|
||||
Accounts payable
|
|
$
|
49,003
|
|
|
$
|
52,793
|
|
|
Oil and gas production payable
|
|
16,509
|
|
|
23,810
|
|
|
||
Accrued interest
|
|
79
|
|
|
31
|
|
|
||
Other accrued expenses
|
|
2,106
|
|
|
1,231
|
|
|
||
Derivative liability – current
|
|
6,318
|
|
|
2,728
|
|
|
||
Current maturities of long-term debt
|
|
2,181
|
|
|
2,142
|
|
|
||
Total current liabilities
|
|
76,196
|
|
|
82,735
|
|
|
||
|
|
|
|
|
|
||||
Long-term debt, excluding current maturities
|
|
44,850
|
|
|
41,790
|
|
|
||
Other liabilities
|
|
57
|
|
|
57
|
|
|
||
Derivative liability – long-term
|
|
5,785
|
|
|
2,274
|
|
|
||
Future site restoration
|
|
9,747
|
|
|
9,888
|
|
|
||
Total liabilities
|
|
136,635
|
|
|
136,744
|
|
|
||
|
|
|
|
|
|
||||
Commitments and contingencies (Note 9)
|
|
|
|
|
|
|
|
||
|
|
|
|
|
|
||||
Stockholders’ Equity
|
|
|
|
|
|
|
|
||
Preferred stock, par value $0.01 per share, authorized 1,000,000 shares; -0- issued and outstanding
|
|
—
|
|
|
—
|
|
|
||
Common stock, par value $0.01 per share, authorized 200,000,000 shares; 105,346,011 and 92,906,049 issued and outstanding, respectively
|
|
1,053
|
|
|
929
|
|
|
||
Additional paid-in capital
|
|
308,696
|
|
|
253,193
|
|
|
||
Accumulated deficit
|
|
(158,871
|
)
|
|
(166,609
|
)
|
|
||
Accumulated other comprehensive loss
|
|
(639
|
)
|
|
(607
|
)
|
|
||
Total stockholders’ equity
|
|
150,239
|
|
|
86,906
|
|
|
||
Total liabilities and stockholders’ equity
|
|
$
|
286,874
|
|
|
$
|
223,650
|
|
|
|
|
Three Months Ended
June 30, |
|
Six Months Ended
June 30, |
||||||||||||
|
|
2014
|
|
2013
|
|
2014
|
|
2013
|
||||||||
Revenue:
|
|
|
|
|
|
|
|
|
||||||||
Oil and gas production revenues
|
|
$
|
33,548
|
|
|
$
|
21,478
|
|
|
$
|
59,398
|
|
|
$
|
42,641
|
|
Other
|
|
11
|
|
|
16
|
|
|
54
|
|
|
49
|
|
||||
|
|
33,559
|
|
|
21,494
|
|
|
59,452
|
|
|
42,690
|
|
||||
Operating costs and expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Lease operating expenses
|
|
5,772
|
|
|
6,166
|
|
|
11,664
|
|
|
12,628
|
|
||||
Production taxes
|
|
2,838
|
|
|
1,911
|
|
|
5,042
|
|
|
3,838
|
|
||||
Depreciation, depletion, and amortization
|
|
9,242
|
|
|
5,776
|
|
|
16,877
|
|
|
12,285
|
|
||||
Impairment
|
|
—
|
|
|
1,977
|
|
|
—
|
|
|
1,977
|
|
||||
General and administrative (including stock-based compensation of $1,029, $669, $1,468 and $1,142, respectively)
|
|
3,117
|
|
|
2,797
|
|
|
5,940
|
|
|
5,327
|
|
||||
|
|
20,969
|
|
|
18,627
|
|
|
39,523
|
|
|
36,055
|
|
||||
Operating income
|
|
12,590
|
|
|
2,867
|
|
|
19,929
|
|
|
6,635
|
|
||||
|
|
|
|
|
|
|
|
|
||||||||
Other (income) expense:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Interest income
|
|
(1
|
)
|
|
—
|
|
|
(1
|
)
|
|
(1
|
)
|
||||
Interest expense
|
|
783
|
|
|
1,259
|
|
|
1,391
|
|
|
2,467
|
|
||||
Amortization of deferred financing fees
|
|
280
|
|
|
343
|
|
|
629
|
|
|
676
|
|
||||
Loss on derivative contracts - Realized
|
|
1,356
|
|
|
783
|
|
|
2,090
|
|
|
1,708
|
|
||||
Loss (gain) on derivative contracts - Unrealized
|
|
7,136
|
|
|
(7,485
|
)
|
|
8,080
|
|
|
(6,864
|
)
|
||||
Other
|
|
2
|
|
|
14
|
|
|
2
|
|
|
101
|
|
||||
|
|
9,556
|
|
|
(5,086
|
)
|
|
12,191
|
|
|
(1,913
|
)
|
||||
Net income before income tax
|
|
3,034
|
|
|
7,953
|
|
|
7,738
|
|
|
8,548
|
|
||||
Income tax expense
|
|
—
|
|
|
87
|
|
|
—
|
|
|
87
|
|
||||
Net income
|
|
$
|
3,034
|
|
|
$
|
7,866
|
|
|
$
|
7,738
|
|
|
$
|
8,461
|
|
|
|
|
|
|
|
|
|
|
||||||||
Net income per common share – basic
|
|
$
|
0.03
|
|
|
$
|
0.09
|
|
|
$
|
0.08
|
|
|
$
|
0.09
|
|
|
|
|
|
|
|
|
|
|
||||||||
Net income per common share – diluted
|
|
$
|
0.03
|
|
|
$
|
0.08
|
|
|
$
|
0.08
|
|
|
$
|
0.09
|
|
|
|
|
|
|
|
|
|
|
||||||||
Weighted average shares outstanding:
|
|
|
|
|
|
|
|
|
||||||||
Basic
|
|
93,448
|
|
|
92,351
|
|
|
93,009
|
|
|
92,323
|
|
||||
Diluted
|
|
97,322
|
|
|
93,361
|
|
|
95,844
|
|
|
93,311
|
|
|
|
Three Months Ended
June 30, |
|
Six Months Ended
June 30, |
||||||||||||
|
|
2014
|
|
2013
|
|
2014
|
|
2013
|
||||||||
Consolidated net income
|
|
$
|
3,034
|
|
|
$
|
7,866
|
|
|
$
|
7,738
|
|
|
$
|
8,461
|
|
Other comprehensive income (loss):
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Change in unrealized value of investments
|
|
—
|
|
|
56
|
|
|
—
|
|
|
49
|
|
||||
Foreign currency translation adjustment
|
|
30
|
|
|
(266
|
)
|
|
(32
|
)
|
|
(397
|
)
|
||||
Other comprehensive income (loss)
|
|
30
|
|
|
(210
|
)
|
|
(32
|
)
|
|
(348
|
)
|
||||
Comprehensive income
|
|
$
|
3,064
|
|
|
$
|
7,656
|
|
|
$
|
7,706
|
|
|
$
|
8,113
|
|
|
|
Six Months Ended
June 30, |
|
||||||
|
|
2014
|
|
2013
|
|
||||
Operating Activities
|
|
|
|
|
|
||||
Net income
|
|
$
|
7,738
|
|
|
$
|
8,461
|
|
|
Adjustments to reconcile net income to net
|
|
|
|
|
|
|
|
||
cash provided by (used in) operating activities:
|
|
|
|
|
|
|
|
||
Change in derivative fair value
|
|
7,998
|
|
|
(6,840
|
)
|
|
||
Depreciation, depletion, and amortization
|
|
16,877
|
|
|
12,285
|
|
|
||
Impairment
|
|
—
|
|
|
1,977
|
|
|
||
Amortization of deferred financing fees
|
|
629
|
|
|
676
|
|
|
||
Accretion of future site restoration
|
|
290
|
|
|
335
|
|
|
||
Stock-based compensation
|
|
1,468
|
|
|
1,142
|
|
|
||
Changes in operating assets and liabilities:
|
|
|
|
|
|
|
|
||
Accounts receivable
|
|
4,766
|
|
|
(6,474
|
)
|
|
||
Other
|
|
281
|
|
|
4,941
|
|
|
||
Accounts payable and accrued expenses
|
|
(10,594
|
)
|
|
6,268
|
|
|
||
Net cash provided by operating activities
|
|
29,453
|
|
|
22,771
|
|
|
||
|
|
|
|
|
|
||||
Investing Activities
|
|
|
|
|
|
|
|
||
Capital expenditures, including purchases and development of properties
|
|
(92,770
|
)
|
|
(33,466
|
)
|
|
||
Proceeds from sale of oil and gas properties
|
|
5,471
|
|
|
3,192
|
|
|
||
Net cash used in investing activities
|
|
(87,299
|
)
|
|
(30,274
|
)
|
|
||
|
|
|
|
|
|
||||
Financing Activities
|
|
|
|
|
|
|
|
||
Proceeds from long-term borrowings
|
|
48,000
|
|
|
21,000
|
|
|
||
Payments on long-term borrowings
|
|
(44,901
|
)
|
|
(13,101
|
)
|
|
||
Proceeds from issuance of common stock
|
|
53,958
|
|
|
—
|
|
|
||
Deferred financing fees
|
|
(855
|
)
|
|
(96
|
)
|
|
||
Exercise of stock options
|
|
201
|
|
|
44
|
|
|
||
Other
|
|
(26
|
)
|
|
(29
|
)
|
|
||
Net cash provided by financing activities
|
|
56,377
|
|
|
7,818
|
|
|
||
Effect of exchange rate changes on cash
|
|
6
|
|
|
56
|
|
|
||
(Decrease) increase in cash
|
|
(1,463
|
)
|
|
371
|
|
|
||
Cash and equivalents, at beginning of period
|
|
$
|
5,205
|
|
|
2,061
|
|
|
|
Cash and equivalents, at end of period
|
|
$
|
3,742
|
|
|
$
|
2,432
|
|
|
|
|
|
|
|
|
||||
Supplemental disclosure of cash flow information:
|
|
|
|
|
|
|
|
||
Interest paid
|
|
$
|
1,052
|
|
|
$
|
2,256
|
|
|
Three Months Ended
June 30, |
|
Six Months Ended
June 30, |
||||||||||||
2014
|
|
2013
|
|
2014
|
|
2013
|
||||||||
$
|
807
|
|
|
$
|
558
|
|
|
$
|
1,114
|
|
|
$
|
920
|
|
|
|
Number
of
Shares
|
|
Weighted
Average
Option
Exercise
Price Per
Share
|
|
Weighted
Average
Grant
Date Fair
Value
Per Share
|
|
|||||
Outstanding, December 31, 2013
|
|
5,400
|
|
|
$
|
2.77
|
|
|
$
|
1.98
|
|
|
Granted
|
|
1,020
|
|
|
$
|
3.36
|
|
|
$
|
2.43
|
|
|
Exercised
|
|
(351
|
)
|
|
$
|
2.69
|
|
|
$
|
1.86
|
|
|
Canceled
|
|
(67
|
)
|
|
$
|
2.97
|
|
|
$
|
2.11
|
|
|
Outstanding, June 30, 2014
|
|
6,002
|
|
|
$
|
2.87
|
|
|
$
|
2.06
|
|
|
|
|
June 30,
2014 |
|
December 31,
2013
|
|
||
Options exercisable
|
|
4,069
|
|
|
3,828
|
|
|
|
|
Number
of
Shares
|
|
Weighted
Average
Grant Date
Fair Value
Per Share
|
|
|||
Unvested, December 31, 2013
|
|
355
|
|
|
$
|
3.24
|
|
|
Granted
|
|
762
|
|
|
3.15
|
|
|
|
Vested/Released
|
|
(5
|
)
|
|
2.94
|
|
|
|
Forfeited
|
|
(20
|
)
|
|
3.47
|
|
|
|
Unvested, June 30, 2014
|
|
1,092
|
|
|
$
|
3.18
|
|
|
|
|
June 30,
2014
|
|
December 31,
2013
|
|
||||
Beginning asset retirement obligation
|
|
$
|
9,888
|
|
|
$
|
11,381
|
|
|
New wells placed on production and other
|
|
151
|
|
|
222
|
|
|
||
Deletions related to property disposals and plugging costs
|
|
(437
|
)
|
|
(2,491
|
)
|
|
||
Accretion expense
|
|
290
|
|
|
638
|
|
|
||
Revisions and other
|
|
(145
|
)
|
|
138
|
|
|
||
Ending asset retirement obligation
|
|
$
|
9,747
|
|
|
$
|
9,888
|
|
|
|
|
June 30,
2014 |
|
December 31, 2013
|
|
||||
Credit facility
|
|
$
|
37,000
|
|
|
$
|
33,000
|
|
|
Rig loan agreement
|
|
5,586
|
|
|
6,378
|
|
|
||
Real estate lien note
|
|
4,445
|
|
|
4,554
|
|
|
||
|
|
47,031
|
|
|
43,932
|
|
|
||
Less current maturities
|
|
(2,181
|
)
|
|
(2,142
|
)
|
|
||
|
|
$
|
44,850
|
|
|
$
|
41,790
|
|
|
•
|
incur or guarantee additional indebtedness;
|
•
|
transfer or sell assets;
|
•
|
create liens on assets;
|
•
|
engage in transactions with affiliates other than on an “arm’s length” basis;
|
•
|
make any change in the principal nature of our business; and
|
•
|
permit a change of control.
|
|
|
Three Months Ended June 30,
|
|
Six Months Ended June 30,
|
||||||||||||
|
|
2014
|
|
2013
|
|
2014
|
|
2013
|
||||||||
Numerator:
|
|
|
|
|
|
|
|
|
||||||||
Net income
|
|
$
|
3,034
|
|
|
$
|
7,866
|
|
|
$
|
7,738
|
|
|
$
|
8,461
|
|
Denominator:
|
|
|
|
|
|
|
|
|
||||||||
Denominator for basic income per share -
|
|
|
|
|
|
|
|
|
||||||||
Weighted-average shares
|
|
93,448
|
|
|
92,351
|
|
|
93,009
|
|
|
92,323
|
|
||||
|
|
|
|
|
|
|
|
|
||||||||
Effect of dilutive securities:
|
|
|
|
|
|
|
|
|
||||||||
Stock options and restricted stock
|
|
3,874
|
|
|
1,010
|
|
|
2,835
|
|
|
988
|
|
||||
|
|
|
|
|
|
|
|
|
||||||||
Denominator for diluted income per share -
|
|
|
|
|
|
|
|
|
||||||||
Weighted-average shares and assumed conversions
|
|
97,322
|
|
|
93,361
|
|
|
95,844
|
|
|
93,311
|
|
||||
|
|
|
|
|
|
|
|
|
||||||||
Net income per common share – basic
|
|
$
|
0.03
|
|
|
$
|
0.09
|
|
|
$
|
0.08
|
|
|
$
|
0.09
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
Net income per common share – diluted
|
|
$
|
0.03
|
|
|
$
|
0.08
|
|
|
$
|
0.08
|
|
|
$
|
0.09
|
|
|
|
Fixed Price Swap
|
||||||||||||||||||||||||||
|
|
Oil – WTI
|
|
Oil - Brent
|
|
Oil - LLS
|
|
Gas
|
||||||||||||||||||||
Contract Periods
|
|
Daily Volume (Bbl)
|
|
Swap Price (per Bbl)
|
|
Daily Volume (Bbl)
|
|
Swap Price (per Bbl)
|
|
Daily Volume (Bbl)
|
|
Swap Price (per Bbl)
|
|
Daily Volume (Mcf)
|
|
Swap Price (per Mcf)
|
||||||||||||
2014
|
|
1,535
|
|
|
$
|
91.87
|
|
|
—
|
|
|
$
|
—
|
|
|
98
|
|
|
$
|
101.26
|
|
|
3,150
|
|
|
$
|
4.07
|
|
2015
|
|
921
|
|
|
$
|
85.00
|
|
|
125
|
|
|
$
|
96.78
|
|
|
—
|
|
|
$
|
—
|
|
|
1,450
|
|
|
$
|
4.08
|
|
2016
|
|
948
|
|
|
$
|
84.10
|
|
|
—
|
|
|
$
|
—
|
|
|
—
|
|
|
$
|
—
|
|
|
—
|
|
|
$
|
—
|
|
2017
|
|
493
|
|
|
$
|
84.18
|
|
|
—
|
|
|
$
|
—
|
|
|
—
|
|
|
$
|
—
|
|
|
—
|
|
|
$
|
—
|
|
Fair Value of Derivative Instruments as of December 31, 2013
|
|
||||||||||||
|
|
Asset Derivatives
|
|
Liability Derivatives
|
|
||||||||
Derivatives not designated as hedging instruments
|
|
Balance Sheet Location
|
|
Fair Value
|
|
Balance Sheet Location
|
|
Fair Value
|
|
||||
Commodity price derivatives
|
|
Derivatives – current
|
|
$
|
85
|
|
|
Derivatives – current
|
|
$
|
2,728
|
|
|
Commodity price derivatives
|
|
Derivatives – long-term
|
|
925
|
|
|
Derivatives – long-term
|
|
2,274
|
|
|
||
|
|
|
|
$
|
1,010
|
|
|
|
|
$
|
5,002
|
|
|
•
|
Level 1 – inputs to the valuation methodology are quoted prices (unadjusted) for identical assets or liabilities in active markets.
|
•
|
Level 2 – inputs to the valuation methodology include quoted prices for similar assets and liabilities in active markets, and inputs that are observable for the asset or liability, either directly or indirectly, for substantially the full term of the financial instrument.
|
•
|
Level 3 - inputs to the valuation methodology are unobservable and significant to the fair value measurement.
|
|
|
Quoted Prices
in Active
Markets for
Identical
Assets
(Level 1)
|
|
Significant
Other
Observable
Inputs
(Level 2)
|
|
Significant
Unobservable
Inputs (Level 3)
|
|
Balance as of June 30,
2014
|
|
||||||||
Assets:
|
|
|
|
|
|
|
|
|
|
||||||||
NYMEX Fixed Price Derivative contracts
|
|
$
|
—
|
|
|
$
|
113
|
|
|
$
|
—
|
|
|
$
|
113
|
|
|
Total Assets
|
|
$
|
—
|
|
|
$
|
113
|
|
|
$
|
—
|
|
|
$
|
113
|
|
|
Liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
NYMEX Fixed Price Derivative contracts
|
|
$
|
—
|
|
|
$
|
12,103
|
|
|
$
|
—
|
|
|
$
|
12,103
|
|
|
Total Liabilities
|
|
$
|
—
|
|
|
$
|
12,103
|
|
|
$
|
—
|
|
|
$
|
12,103
|
|
|
|
|
Quoted Prices
in Active
Markets for
Identical
Assets
(Level 1)
|
|
Significant
Other
Observable
Inputs
(Level 2)
|
|
Significant
Unobservable
Inputs (Level 3)
|
|
Balance as of
December 31,
2013
|
|
||||||||
Assets:
|
|
|
|
|
|
|
|
|
|
||||||||
NYMEX Fixed Price Derivative contracts
|
|
$
|
—
|
|
|
$
|
1,010
|
|
|
$
|
—
|
|
|
$
|
1,010
|
|
|
Total Assets
|
|
$
|
—
|
|
|
$
|
1,010
|
|
|
$
|
—
|
|
|
$
|
1,010
|
|
|
Liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
NYMEX Fixed Price Derivative contracts
|
|
$
|
—
|
|
|
$
|
5,002
|
|
|
$
|
—
|
|
|
$
|
5,002
|
|
|
Total Liabilities
|
|
$
|
—
|
|
|
$
|
5,002
|
|
|
$
|
—
|
|
|
$
|
5,002
|
|
|
|
|
Three Months Ended June 30, 2014
|
|
||||||||||||||
|
|
U.S.
|
|
Canada
|
|
Corporate
|
|
Total
|
|
||||||||
Revenues:
|
|
|
|
|
|
|
|
|
|
||||||||
Oil and gas production
|
|
$
|
33,181
|
|
|
$
|
367
|
|
|
$
|
—
|
|
|
$
|
33,548
|
|
|
Other
|
|
—
|
|
|
—
|
|
|
11
|
|
|
11
|
|
|
||||
|
|
33,181
|
|
|
367
|
|
|
11
|
|
|
33,559
|
|
|
||||
Expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Lease operating
|
|
5,585
|
|
|
187
|
|
|
—
|
|
|
5,772
|
|
|
||||
Production taxes
|
|
2,838
|
|
|
—
|
|
|
—
|
|
|
2,838
|
|
|
||||
Depreciation, depletion and amortization
|
|
9,044
|
|
|
136
|
|
|
62
|
|
|
9,242
|
|
|
||||
General and administrative
|
|
508
|
|
|
56
|
|
|
2,553
|
|
|
3,117
|
|
|
||||
Net interest
|
|
140
|
|
|
6
|
|
|
636
|
|
|
782
|
|
|
||||
Amortization of deferred financing fees
|
|
—
|
|
|
—
|
|
|
280
|
|
|
280
|
|
|
||||
Loss on derivative contracts - Realized
|
|
—
|
|
|
—
|
|
|
1,356
|
|
|
1,356
|
|
|
||||
Loss on derivative contracts - Unrealized
|
|
—
|
|
|
—
|
|
|
7,136
|
|
|
7,136
|
|
|
||||
Other
|
|
—
|
|
|
—
|
|
|
2
|
|
|
2
|
|
|
||||
Net income (loss)
|
|
$
|
15,066
|
|
|
$
|
(18
|
)
|
|
$
|
(12,014
|
)
|
|
$
|
3,034
|
|
|
|
|
Three Months Ended June 30, 2013
|
|
||||||||||||||
|
|
U.S.
|
|
Canada
|
|
Corporate
|
|
Total
|
|
||||||||
Revenues:
|
|
|
|
|
|
|
|
|
|
||||||||
Oil and gas production
|
|
$
|
20,946
|
|
|
$
|
532
|
|
|
$
|
—
|
|
|
$
|
21,478
|
|
|
Other
|
|
—
|
|
|
—
|
|
|
16
|
|
|
16
|
|
|
||||
|
|
20,946
|
|
|
532
|
|
|
16
|
|
|
21,494
|
|
|
||||
Expenses (income):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Lease operating
|
|
5,783
|
|
|
383
|
|
|
—
|
|
|
6,166
|
|
|
||||
Production taxes
|
|
1,906
|
|
|
5
|
|
|
—
|
|
|
1,911
|
|
|
||||
Depreciation, depletion and amortization
|
|
5,411
|
|
|
302
|
|
|
63
|
|
|
5,776
|
|
|
||||
Impairment
|
|
—
|
|
|
1,977
|
|
|
—
|
|
|
1,977
|
|
|
||||
General and administrative
|
|
486
|
|
|
186
|
|
|
2,125
|
|
|
2,797
|
|
|
||||
Net interest
|
|
157
|
|
|
5
|
|
|
1,097
|
|
|
1,259
|
|
|
||||
Amortization of deferred financing fees
|
|
—
|
|
|
—
|
|
|
343
|
|
|
343
|
|
|
||||
Loss on derivative contracts - Realized
|
|
—
|
|
|
—
|
|
|
783
|
|
|
783
|
|
|
||||
(Gain) on derivative contracts - Unrealized
|
|
—
|
|
|
—
|
|
|
(7,485
|
)
|
|
(7,485
|
)
|
|
||||
Other
|
|
—
|
|
|
—
|
|
|
14
|
|
|
14
|
|
|
||||
Income tax expense
|
|
—
|
|
|
—
|
|
|
87
|
|
|
87
|
|
|
||||
Net income (loss)
|
|
$
|
7,203
|
|
|
$
|
(2,326
|
)
|
|
$
|
2,989
|
|
|
$
|
7,866
|
|
|
|
|
Six Months Ended June 30, 2014
|
||||||||||||||
|
|
U.S.
|
|
Canada
|
|
Corporate
|
|
Total
|
||||||||
Revenues:
|
|
|
|
|
|
|
|
|
||||||||
Oil and gas production
|
|
$
|
58,656
|
|
|
$
|
742
|
|
|
$
|
—
|
|
|
$
|
59,398
|
|
Other
|
|
—
|
|
|
—
|
|
|
54
|
|
|
54
|
|
||||
|
|
58,656
|
|
|
742
|
|
|
54
|
|
|
59,452
|
|
||||
Expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Lease operating
|
|
11,230
|
|
|
434
|
|
|
—
|
|
|
11,664
|
|
||||
Production taxes
|
|
5,042
|
|
|
—
|
|
|
—
|
|
|
5,042
|
|
||||
Depreciation, depletion and amortization
|
|
16,481
|
|
|
272
|
|
|
124
|
|
|
16,877
|
|
||||
General and administrative
|
|
1,017
|
|
|
404
|
|
|
4,519
|
|
|
5,940
|
|
||||
Net interest
|
|
278
|
|
|
12
|
|
|
1,100
|
|
|
1,390
|
|
||||
Amortization of deferred financing fees
|
|
—
|
|
|
—
|
|
|
629
|
|
|
629
|
|
||||
Loss on derivative contracts - Realized
|
|
—
|
|
|
—
|
|
|
2,090
|
|
|
2,090
|
|
||||
Loss on derivative contracts - Unrealized
|
|
—
|
|
|
—
|
|
|
8,080
|
|
|
8,080
|
|
||||
Other
|
|
—
|
|
|
—
|
|
|
2
|
|
|
2
|
|
||||
Net income (loss)
|
|
$
|
24,608
|
|
|
$
|
(380
|
)
|
|
$
|
(16,490
|
)
|
|
$
|
7,738
|
|
|
|
Six Months Ended June 30, 2013
|
||||||||||||||
|
|
U.S.
|
|
Canada
|
|
Corporate
|
|
Total
|
||||||||
Revenues:
|
|
|
|
|
|
|
|
|
||||||||
Oil and gas production
|
|
$
|
41,504
|
|
|
$
|
1,137
|
|
|
$
|
—
|
|
|
$
|
42,641
|
|
Other
|
|
—
|
|
|
—
|
|
|
49
|
|
|
49
|
|
||||
|
|
41,504
|
|
|
1,137
|
|
|
49
|
|
|
42,690
|
|
||||
Expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Lease operating
|
|
11,587
|
|
|
1,041
|
|
|
—
|
|
|
12,628
|
|
||||
Production taxes
|
|
3,833
|
|
|
5
|
|
|
—
|
|
|
3,838
|
|
||||
Depreciation, depletion and amortization
|
|
11,625
|
|
|
535
|
|
|
125
|
|
|
12,285
|
|
||||
Impairment
|
|
—
|
|
|
1,977
|
|
|
—
|
|
|
1,977
|
|
||||
General and administrative
|
|
961
|
|
|
341
|
|
|
4,025
|
|
|
5,327
|
|
||||
Net interest
|
|
323
|
|
|
11
|
|
|
2,132
|
|
|
2,466
|
|
||||
Amortization of deferred financing fees
|
|
—
|
|
|
—
|
|
|
676
|
|
|
676
|
|
||||
Loss on derivative contracts - Realized
|
|
—
|
|
|
—
|
|
|
1,708
|
|
|
1,708
|
|
||||
(Gain) on derivative contracts - Unrealized
|
|
—
|
|
|
—
|
|
|
(6,864
|
)
|
|
(6,864
|
)
|
||||
Other
|
|
—
|
|
|
—
|
|
|
101
|
|
|
101
|
|
||||
Income tax expense
|
|
—
|
|
|
—
|
|
|
87
|
|
|
87
|
|
||||
Net income (loss)
|
|
$
|
13,175
|
|
|
$
|
(2,773
|
)
|
|
$
|
(1,941
|
)
|
|
$
|
8,461
|
|
Segment Assets:
|
|
June 30,
2014 |
|
December 31,
2013 |
|
||||
United States
|
|
$
|
277,407
|
|
|
$
|
213,212
|
|
|
Canada
|
|
1,467
|
|
|
1,640
|
|
|
||
Corporate
|
|
8,000
|
|
|
8,798
|
|
|
||
|
|
$
|
286,874
|
|
|
$
|
223,650
|
|
|
•
|
commodity prices and the effectiveness of our hedging arrangements;
|
•
|
the level of total sales volumes of oil and gas;
|
•
|
the availability of and our ability to raise additional capital resources and provide liquidity to meet cash flow needs;
|
•
|
the level of and interest rates on borrowings; and
|
•
|
the level and success of exploration and development activity
|
•
|
basis differentials which are dependent on actual delivery location;
|
•
|
adjustments for BTU content;
|
•
|
quality of the hydrocarbons; and
|
•
|
gathering; processing and transportation costs.
|
|
|
Oil - NYMEX
|
|
Gas - NYMEX
|
|
||||||||||||
|
|
2014
|
|
2013
|
|
2014
|
|
2013
|
|
||||||||
Average realized price (1)
|
|
$
|
92.57
|
|
|
$
|
90.61
|
|
|
$
|
4.69
|
|
|
$
|
3.26
|
|
|
Average NYMEX price
|
|
$
|
100.84
|
|
|
$
|
94.26
|
|
|
$
|
4.65
|
|
|
$
|
3.76
|
|
|
Differential
|
|
$
|
(8.27
|
)
|
|
$
|
(3.65
|
)
|
|
$
|
0.04
|
|
|
$
|
(0.50
|
)
|
|
(1)
|
excludes the impact of derivative activities
|
|
|
Fixed Price Swap
|
||||||||||||||||||||||||||
|
|
Oil – WTI
|
|
Oil - Brent
|
|
Oil - LLS
|
|
Gas
|
||||||||||||||||||||
Contract Periods
|
|
Daily Volume (Bbl)
|
|
Swap Price (per Bbl)
|
|
Daily Volume (Bbl)
|
|
Swap Price (per Bbl)
|
|
Daily Volume (Bbl)
|
|
Swap Price (per Bbl)
|
|
Daily Volume (Mcf)
|
|
Swap Price (per Mcf)
|
||||||||||||
2014
|
|
1,535
|
|
|
$
|
91.87
|
|
|
—
|
|
|
$
|
—
|
|
|
98
|
|
|
$
|
101.26
|
|
|
3,150
|
|
|
$
|
4.07
|
|
2015
|
|
921
|
|
|
$
|
85.00
|
|
|
125
|
|
|
$
|
96.78
|
|
|
—
|
|
|
$
|
—
|
|
|
1,450
|
|
|
$
|
4.08
|
|
2016
|
|
948
|
|
|
$
|
84.10
|
|
|
—
|
|
|
$
|
—
|
|
|
—
|
|
|
$
|
—
|
|
|
—
|
|
|
$
|
—
|
|
2017
|
|
493
|
|
|
$
|
84.18
|
|
|
—
|
|
|
$
|
—
|
|
|
—
|
|
|
$
|
—
|
|
|
—
|
|
|
$
|
—
|
|
|
|
Three Months Ended
June 30, |
|
Six Months Ended
June 30, |
|
||||||||||||
|
|
2014
|
|
2013
|
|
2014
|
|
2013
|
|
||||||||
Operating revenue: (1)
|
|
|
|
|
|
|
|
|
|
||||||||
Oil sales
|
|
$
|
29,514
|
|
|
$
|
17,261
|
|
|
$
|
50,450
|
|
|
$
|
34,445
|
|
|
Gas sales
|
|
2,752
|
|
|
3,137
|
|
|
6,002
|
|
|
5,989
|
|
|
||||
NGL sales
|
|
1,282
|
|
|
1,080
|
|
|
2,946
|
|
|
2,207
|
|
|
||||
Other
|
|
11
|
|
|
16
|
|
|
54
|
|
|
49
|
|
|
||||
|
|
$
|
33,559
|
|
|
$
|
21,494
|
|
|
$
|
59,452
|
|
|
$
|
42,690
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Operating income
|
|
12,590
|
|
|
2,867
|
|
|
19,929
|
|
|
6,635
|
|
|
||||
|
|
|
|
|
|
|
|
|
|
||||||||
Oil sales (MBbl)
|
|
313
|
|
|
191
|
|
|
545
|
|
|
380
|
|
|
||||
Gas sales (MMcf)
|
|
633
|
|
|
894
|
|
|
1,279
|
|
|
1,839
|
|
|
||||
NGL sales (MBbl)
|
|
35
|
|
|
34
|
|
|
73
|
|
|
67
|
|
|
||||
BOE sales
|
|
454
|
|
|
374
|
|
|
831
|
|
|
753
|
|
|
||||
Average oil sales price (per Bbl) (1)
|
|
$
|
94.34
|
|
|
$
|
90.59
|
|
|
$
|
92.57
|
|
|
$
|
90.61
|
|
|
Average gas sales price (per Mcf) (1)
|
|
$
|
4.35
|
|
|
$
|
3.51
|
|
|
$
|
4.69
|
|
|
$
|
3.26
|
|
|
Average NGL sales price (per Bbl)
|
|
$
|
36.16
|
|
|
$
|
31.46
|
|
|
$
|
40.61
|
|
|
$
|
33.12
|
|
|
Average oil equivalent price (Boe)
|
|
$
|
73.93
|
|
|
$
|
57.45
|
|
|
$
|
71.50
|
|
|
$
|
56.60
|
|
|
(1)
|
Revenue and average sales prices are before the impact of derivative activities.
|
•
|
the development and exploration of existing properties, including drilling and completion costs of wells;
|
•
|
acquisition of interests in additional oil and gas properties; and
|
•
|
production and transportation facilities.
|
|
|
Six Months Ended
June 30,
|
|
||||||
|
|
2014
|
|
2013
|
|
||||
Expenditure category:
|
|
|
|
|
|
||||
Development
|
|
$
|
91,323
|
|
|
$
|
32,996
|
|
|
Facilities and other
|
|
1,447
|
|
|
470
|
|
|
||
Total
|
|
$
|
92,770
|
|
|
$
|
33,466
|
|
|
|
|
Six Months Ended
June 30, |
|
||||||
|
|
2014
|
|
2013
|
|
||||
Net cash provided by operating activities
|
|
$
|
29,453
|
|
|
$
|
22,771
|
|
|
Net cash used in investing activities
|
|
(87,299
|
)
|
|
(30,274
|
)
|
|
||
Net cash provided by financing activities
|
|
56,377
|
|
|
7,818
|
|
|
||
Total
|
|
$
|
(1,469
|
)
|
|
$
|
315
|
|
|
•
|
Long-term debt, and
|
•
|
Operating leases for office facilities.
|
|
|
Payments due in twelve month periods ending:
|
|
||||||||||||||||||
|
|
Total
|
|
June 30,
2015 |
|
June 30, 2016-2017
|
|
June 30, 2018-2019
|
|
Thereafter
|
|
||||||||||
Long-term debt (1)
|
|
$
|
47,031
|
|
|
$
|
2,181
|
|
|
$
|
4,110
|
|
|
$
|
37,523
|
|
|
$
|
3,217
|
|
|
Interest on long-term debt (2)
|
|
4,526
|
|
|
1,090
|
|
|
1,893
|
|
|
1,003
|
|
|
540
|
|
|
|||||
Lease obligations (3)
|
|
35
|
|
|
21
|
|
|
14
|
|
|
—
|
|
|
—
|
|
|
|||||
Total
|
|
$
|
51,592
|
|
|
$
|
3,292
|
|
|
$
|
6,017
|
|
|
$
|
38,526
|
|
|
$
|
3,757
|
|
|
(1)
|
These amounts represent the balances outstanding under our credit facility, the rig loan agreement and the real estate lien note. These repayments assume that we will not borrow additional funds.
|
(2)
|
Interest expense assumes the balances of long-term debt at the end of the period and current effective interest rates.
|
(3)
|
Lease on office space in Dickinson, North Dakota, which expires on September 30, 2014, office space in Lusk, Wyoming, which expires on December 31, 2016 and office space in Denver, Colorado, which expires December 31, 2014.
|
|
|
June 30,
2014 |
|
December 31, 2013
|
|
||||
Credit facility
|
|
$
|
37,000
|
|
|
$
|
33,000
|
|
|
Rig loan agreement
|
|
5,586
|
|
|
6,378
|
|
|
||
Real estate lien note
|
|
4,445
|
|
|
4,554
|
|
|
||
|
|
47,031
|
|
|
43,932
|
|
|
||
Less current maturities
|
|
(2,181
|
)
|
|
(2,142
|
)
|
|
||
|
|
$
|
44,850
|
|
|
$
|
41,790
|
|
|
•
|
incur or guarantee additional indebtedness;
|
•
|
transfer or sell assets;
|
•
|
create liens on assets;
|
•
|
engage in transactions with affiliates other than on an “arm’s length” basis;
|
•
|
make any change in the principal nature of our business; and
|
•
|
permit a change of control.
|
|
|
Fixed Price Swap
|
||||||||||||||||||||||||||
|
|
Oil – WTI
|
|
Oil - Brent
|
|
Oil - LLS
|
|
Gas
|
||||||||||||||||||||
Contract Periods
|
|
Daily Volume (Bbl)
|
|
Swap Price (per Bbl)
|
|
Daily Volume (Bbl)
|
|
Swap Price (per Bbl)
|
|
Daily Volume (Bbl)
|
|
Swap Price (per Bbl)
|
|
Daily Volume (Mcf)
|
|
Swap Price (per Mcf)
|
||||||||||||
2014
|
|
1,535
|
|
|
$
|
91.87
|
|
|
—
|
|
|
$
|
—
|
|
|
98
|
|
|
$
|
101.26
|
|
|
3,150
|
|
|
$
|
4.07
|
|
2015
|
|
921
|
|
|
$
|
85.00
|
|
|
125
|
|
|
$
|
96.78
|
|
|
—
|
|
|
$
|
—
|
|
|
1,450
|
|
|
$
|
4.08
|
|
2016
|
|
948
|
|
|
$
|
84.10
|
|
|
—
|
|
|
$
|
—
|
|
|
—
|
|
|
$
|
—
|
|
|
—
|
|
|
$
|
—
|
|
2017
|
|
493
|
|
|
$
|
84.18
|
|
|
—
|
|
|
$
|
—
|
|
|
—
|
|
|
$
|
—
|
|
|
—
|
|
|
$
|
—
|
|
(a)
|
Exhibits
|
|
Exhibit 10.1
|
|
Promissory Note Plains Capital
|
|
|
Exhibit 10.2
|
|
Second Modification, Renewal and Extension of Promissory Note and Deed of Trust Liens
|
|
|
Exhibit 10.3
|
|
Third Modification, Renewal and Extension of Promissory Note and Deed of Trust Liens
|
|
|
Exhibit 31.1
|
|
Certification - Robert L.G. Watson, CEO
|
|
|
Exhibit 31.2
|
|
Certification - Geoffrey R. King, CFO
|
|
|
Exhibit 32.1
|
|
Certification pursuant to 18 U.S.C. Section 1350 - Robert L.G. Watson, CEO
|
|
|
Exhibit 32.2
|
|
Certification pursuant to 18 U.S.C. Section 1350 - Geoffrey R. King, CFO
|
|
Date
|
August 8, 2014
|
|
By:
/s/Robert L.G. Watson
|
|
|
|
ROBERT L.G. WATSON,
|
|
|
|
President and
|
|
|
|
Principal Executive Officer
|
Date
|
August 8, 2014
|
|
By
: /s/Geoffrey R. King
|
|
|
|
GEOFFREY R. KING,
|
|
|
|
Vice President and
|
|
|
|
Principal Financial Officer
|
Date
|
August 8, 2014
|
|
By
: /s/G. William Krog, Jr.
|
|
|
|
G. WILLIAM KROG, JR.,
|
|
|
|
Principal Accounting Officer
|
1 Year Abraxas Petroleum (CE) Chart |
1 Month Abraxas Petroleum (CE) Chart |
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