Amplify Energy Corp.
For the period ended Mar 31, 2025. Filed May 12, 2025.
View on SEC.govAbout this filing
A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Mar 31, 2025 · Filed May 12, 2025
AMPY$3.33+4.7%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2024-09-30; filed 2024-11-06.
0001558370-24-014637
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2025-03-31; filed 2025-05-12.
0001558370-25-007383
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 94 previous paragraphs and 85 current paragraphs.
36 unchanged; 33 reworded; 15 added; 24 removed; 1 previous and 1 current paragraphs rearranged.
Tables are not compared: 28 previous and 26 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (15)
Current report
We continue to monitor the impact of the actions of OPEC+ and other large producing nations, the Russia-Ukraine conflict, conflicts in the Middle East, the imposition of tariffs or other economic sanctions, global inventories of oil and natural gas and the uncertainty associated with recovering oil demand, inflation and future monetary policy and governmental policies aimed at transitioning towards lower carbon energy. Most recently, in early 2025, there has been a decline of oil, natural gas and NGL prices that continued into April 2025 resulting from (i) trade tariff uncertainties driving concerns over an increase in inflation and (ii) OPEC+’s decision to increase production starting in May, creating additional global supply and further downward pressure on oil prices.
Current report
East Texas Haynesville Monetization
Current report
On May 1, 2025, the Company sold certain rights, title and interest in assets located in East Texas to a third party. The Company received net proceeds of $1.5 million.
Current report
Termination of Contemplated Merger with Juniper Capital
Current report
In connection with the Contemplated Mergers, on April 25, 2025, pursuant to Section 8.1(a) of the Merger Agreement, the Company and the Acquired Companies entered into the Termination Agreement to terminate the Merger Agreement, effective immediately. As a result of the Termination Agreement, the Merger Agreement is of no further force and effect.
Current report
For additional information regarding the Termination, see Notes 4 and 18 of the Notes to Unaudited Condensed Consolidated Financial Statements included under “Item 1. Financial Statements” of this quarterly report.
Current report
Other revenues were $1.7 million and $1.0 million for the three months ended March 31, 2025 and 2024, respectively. The increase primarily related to an increase of $0.7 million for iodine sales from the renegotiation of our sales contract in 2024.
Current report
Interest expense, net was $3.5 million and $3.5 million for the three months ended March 31, 2025 and 2024, respectively.
Current report
Non-GAAP Financial Measures
Current report
Adjusted Net Income (Loss)
Current report
We define Adjusted Net Income (Loss) as net income (loss) adjusted for unrealized loss (gain) on commodity derivative instruments, acquisition and divestiture-related expenses, unusual and infrequent items, and the income tax expense or benefit of these adjustments using our federal statutory tax rate. This measure is not meant to disassociate these items from management's performance but rather is intended to provide helpful information to investors interested in comparing our performance between periods. Adjusted Net Income (Loss) is not considered to be an alternative to net income (loss) reported in accordance with GAAP.
Current report
(1) The federal statutory rates were utilized for all periods presented.
Current report
Adjusted EBITDA is a supplemental non-GAAP financial measure that is used by management and external users of our consolidated financial statements, such as industry analysts, investors, lenders and rating agencies. Adjusted EBITDA is not a measure of net income or cash flows as determined by GAAP. We define Adjusted EBITDA as net income (loss):
Current report
Termination of Contemplated Merger with Juniper Capital**.**In connection with the Contemplated Mergers, on April 25, 2025, pursuant to Section 8.1(a) of the Merger Agreement, the Company and the Acquired Companies entered into the Termination Agreement to terminate the Merger Agreement, effective immediately. In accordance with the terms of the Termination Agreement, the Company made a cash payment to the Acquired Companies in lieu of any termination fee which might have otherwise been payable pursuant to the Merger Agreement in the amount of $800,000 as payment for certain of the Acquired Companies’ expenses. The Company expects to incur professional fees and expenses of approximately $3.0 million in connection with the Contemplated Mergers and the Termination. For additional information regarding the Termination, see Notes 4 and 18 of the Notes to Unaudited Condensed Consolidated Financial Statements included under “Item 1. Financial Statements” of this quarterly report.
Current report
In January 2025, we purchased and sold certain rights, title and interest in assets in East Texas from a third party, whereby we received net proceeds of $6.3 million. See additional information discussed in Note 4 of the Notes to Unaudited Condensed Consolidated Financial Statements included under “Item 1. Financial Statements” of this quarterly report.
Removed paragraphs (24)
Previous report
Credit Agreement Amendment
Previous report
On October 25, 2024, OLLC entered into the Credit Agreement Amendment, which among other things, (i) reduced the borrowing base under the Revolving Credit Facility from $150.0 million to $145.0 million, (ii) increased the aggregate elected commitments under the Revolving Credit Facility from $135.0 million to $145.0 million and (iii) amended certain interest rates applicable to loans under the Revolving Credit Facility. The next redetermination is expected in the spring of 2025.
Previous report
Revenue Payables in Suspense
Previous report
In the normal course of business, we undertake efforts to research and resolve the disputes, legal reasons or uncertainties causing revenues of owners of mineral interests in our leases to go into suspense. As resolutions occur, obligations related to revenue payables in suspense are released. For the nine months ended September 30, 2024, we released $8.4 million, respectively, of net revenues in suspense as a result of these efforts. The following table presents the impact of releases of revenue payables in suspense to our statements of operations for the nine months ended September 30, 2024:
Previous report
Oil, natural gas and NGL revenues were $68.1 million and $76.4 million for the three months ended September 30, 2024 and 2023, respectively. Average net production volumes were approximately 19.0 MBoe/d and 20.6 MBoe/d for the three months ended September 30, 2024 and 2023, respectively. The change in production volumes was driven by several days shut-in for the electrification and emissions reduction project at Beta and natural decline in well productivity over time. The average realized sales prices were $38.88 per Boe and $40.28 per Boe for the three months ended September 30, 2024 and 2023, respectively. The change in average realized sales prices was primarily due to lower commodity prices.
Previous report
Other revenues were $1.7 million and $0.4 million for the three months ended September 30, 2024 and 2023, respectively. For the three months ended September 30, 2024, other revenues consisted of iodine sales, rental income with respect to our wholly owned subsidiary, Magnify Energy Services (“Magnify”), and interest income earned on our sinking fund escrow accounts.
Previous report
Taxes other than income were $6.0 million and $5.5 million for the three months ended September 30, 2024 and 2023, respectively. On a per Boe basis, taxes other than income were $3.42 and $2.92 for the three months ended September 30, 2024 and 2023, respectively. The change was primarily related to waste emissions charges and air quality management district fees in California.
Previous report
General and administrative expenses were $8.3 million for each of the three months ended September 30, 2024 and 2023. General and administrative expenses were previously forecasted to remain flat compared to the prior year.
Previous report
Net gain on commodity derivative instruments of $25.0 million were recognized for the three months ended September 30, 2024, consisting of $18.7 million increase in the fair value of open positions, $5.6 million of cash settlements received on expired positions and $0.8 million of cash settlements received on terminated derivative instruments. Net loss on commodity derivative instruments of $23.3 million was recognized for the three months ended September 30, 2023, consisting of $3.9 million of cash settlements paid on expired positions and an increase of $20.1 million in the fair value of open position, partially offset by $0.7 million of cash settlements received on terminated derivative instruments.
Previous report
Interest expense, net was $3.8 million and $4.5 million for the three months ended September 30, 2024 and 2023, respectively. The change in interest expense was primarily attributable to the write-off of deferred financing costs in connection with the refinancing of the Revolving Credit Facility in July 2023.
Previous report
Litigation settlementwas not recorded for the three months ended September 30, 2024 and 2023.
Previous report
Deferred income tax benefit (expense)was ($5.7) million and $4.7 million for the three months ended September 30, 2024 and 2023, respectively. Starting in the first quarter of 2023, we achieved three years of cumulative book income which resulted in the release of the valuation allowance. See additional information discussed in Note 15 of the Notes to Unaudited Condensed Consolidated Financial Statements included under “Item 1. Financial Statements” of this quarterly report.
Previous report
For the Nine Months Ended September 30, 2024 Compared to the Nine Months Ended September 30, 2023
Previous report
We reported net income of $20.4 million compared to net income of $349.2 million for the nine months ended September 30, 2024 and 2023, respectively.
Previous report
Other revenues were $9.9 million and $18.5 million for the nine months ended September 30, 2024 and 2023, respectively. For the nine months ended September 30, 2024, other revenues consisted of iodine sales, Magnify rental income, and interest income earned on our sinking fund escrow accounts. Additionally, for the nine months ended September 30, 2024, we recorded a revenue suspense release of $4.8 million. For the nine months ended September 30, 2023, other revenues were primarily related to our receipt of LOPI insurance proceeds of $17.9 million. We have not received LOPI insurance proceeds since payments under the LOPI policy terminated on March 31, 2023.
Previous report
Lease operating expenses were $107.9 million and $104.0 million for the nine months ended September 30, 2024 and 2023, respectively. On a per Boe basis, lease operating expenses were $19.83 and $18.67 for the nine months ended September 30, 2024 and 2023, respectively. The change in lease operating expense was primarily related to operating costs associated with Beta returning to production after being offline for the first quarter of 2023.
Previous report
Gathering, processing and transportation expenses were $14.0 million and $15.7 million for the nine months ended September 30, 2024 and 2023, respectively. On a per Boe basis, gathering, processing and transportation expenses were $2.57 and $2.83 for the nine months ended September 30, 2024 and 2023, respectively. The change in gathering, processing and transportation expense was primarily due to lower gas volumes, lower natural gas prices and the expiration of minimum volume commitments for our Oklahoma properties.
Previous report
DD&A expenses were $24.2 million and $20.4 million for the nine months ended September 30, 2024 and 2023, respectively. The increase in DD&A expense was primarily driven by operations restarting at Beta.
Previous report
Interest expense, net was $10.9 million and $13.9 million for the nine months ended September 30, 2024 and 2023, respectively. The change in interest expense was primarily driven by lower outstanding borrowings and amortization and write-off of deferred issuance costs.
Previous report
Average outstanding borrowings under our Revolving Credit Facility were $119.8 million and $145.8 million for the nine months ended September 30, 2024 and 2023, respectively.
Previous report
Litigation settlementwas not recorded for the nine months ended September 30, 2024 and $84.9 million was recorded for the nine months ended September 30, 2023, related to the settlement with the shipping companies and the containerships whose anchors struck the Company’s pipeline. See additional information discussed in Note 16 of the Notes to Unaudited Condensed Consolidated Financial Statements included under “Item 1. Financial Statements” of this quarterly report.
Previous report
Deferred income tax benefit (expense)was ($3.1) million and $264.1 million for the nine months ended September 30, 2024 and 2023, respectively. Starting in the first quarter of 2023, we achieved three years of cumulative book income which resulted in the release of the valuation allowance. See additional information discussed in Note 15 of the Notes to Unaudited Condensed Consolidated Financial Statements included under “Item 1. Financial Statements” of this quarterly report.
Previous report
Impact of the Beta Pipeline Incident. There are remaining uncertainties surrounding the full impact that the Incident will have on our financial condition and cash flow generation going forward. We have incurred and will continue to incur certain costs as a result of the Incident. However, in addition to the settlement amount disclosed elsewhere in this Quarterly Report on Form 10-Q that we received from the vessels that struck and damaged the Pipeline and their respective owners and operators, we carry customary insurance policies, which have covered a material portion of aggregate costs, including loss of production income insurance to offset loss of revenue resulting from suspended operations. The loss of production income insurance related to the Incident expired on March 31, 2023. We restarted operations at Beta in April 2023. We can provide no assurance that our coverage will adequately protect us against liability from all potential consequences, damages and losses related to the Incident.
Previous report
On October 25, 2024, we entered into the Credit Agreement Amendment, which among other things, (i) reduced the borrowing base under the Revolving Credit Facility from $150.0 million to $145.0 million, (ii) increased the aggregate elected commitments under the Revolving Credit Facility from $135.0 million to $145.0 million and (iii) amended certain interest rates applicable to loans under the Revolving Credit Facility.
Reworded paragraphs (33)
Previous wording
We continue to monitor the impact of the actions of the Organization of the Petroleum Exporting Countries and other large producing nations; the Russia-Ukraine conflict; conflicts in the Middle East; global inventories of oil and natural gas and the uncertainty associated with recovering oil demand; inflation and future monetary policy; and governmental policies aimed at transitioning towards lower carbon energy. Due to these factors, among others, we expect prices for some or all commodities to remain volatile. Thus, we cannot predict with reasonable certainty the extent to which these factors may impact our business, results of operations, financial condition and cash flows.
Current wording
While U.S. inflation rates during the first quarter of 2025 remained relatively stable, they continued to be slightly higher than historical averages. Such inflation, along with the effects of economic pressures from international military and trade conflicts, could, as a result, continue to raise the cost of borrowing, impact the demand for and price of oil and natural gas, increase the price of crucial supplies and raw materials and impact interest rates. Due to these factors, among others, we expect prices for some or all commodities to remain volatile. Thus, we cannot predict with reasonable certainty the extent to which these factors may impact our business, results of operations, financial condition and cash flows.
Previous wording
The results of operations for the three and nine months ended September 30, 2024 and 2023 have been derived from our unaudited condensed consolidated financial statements. The comparability of the results of operations among the periods presented below is impacted by the Incident and suspension of operations at our Beta properties during 2023.
Current wording
The results of operations for the three months ended March 31, 2025 and 2024 have been derived from our unaudited condensed consolidated financial statements.
Previous wording
We reported net income of $22.7 million compared to a net loss of $13.4 million for the three months ended September 30, 2024 and 2023, respectively.
Current wording
We reported a net loss of $5.9 million compared to a net loss of $9.4 million for the three months ended March 31, 2025 and 2024, respectively.
Previous wording
Oil, natural gas and NGL revenues were $215.8 million and $210.1 million for the nine months ended September 30, 2024 and 2023, respectively. Average net production volumes were approximately 19.8 MBoe/d and 20.4 MBoe/d for the nine months ended September 30, 2024 and 2023, respectively. The average realized sales prices were $39.69 per Boe and $37.72 per Boe for the nine months ended September 30, 2024 and 2023, respectively. The change in realized sales prices was primarily due to higher commodity prices, Beta returning to production after being offline for the first quarter of 2023 and the release of revenue suspense of $4.0 million.
Current wording
Oil, natural gas and NGL revenues were $70.3 million and $75.3 million for the three months ended March 31, 2025 and 2024, respectively. Average net production volumes were approximately 17.9 MBoe/d and 20.2 MBoe/d for the three months ended March 31, 2025 and 2024, respectively. The average realized sales prices were $43.76 per Boe and $40.89 per Boe for the three months ended March 31, 2025 and 2024, respectively. The change in realized sales prices was due to higher natural gas and NGL prices, partially offset by lower realized sales prices for oil. In addition, oil production had a higher percentage of total production in the first quarter of 2025 when compared to the first quarter of 2024.
Previous wording
Lease operating expenses were $33.3 million and $36.5 million for the three months ended September 30, 2024 and 2023, respectively. On a per Boe basis, lease operating expenses were $18.98 and $19.23 for the three months ended September 30, 2024 and 2023, respectively. The change in lease operating expenses was primarily due to a decrease of $1.5 million in lease operating cost and a decrease of $1.7 million in workover expense.
Current wording
Lease operating expenses were $37.4 million and $38.3 million for the three months ended March 31, 2025 and 2024, respectively. On a per Boe basis, lease operating expenses were $23.28 and $20.78 for the three months ended March 31, 2025 and 2024, respectively. The change in lease operating expense on a per Boe basis was primarily due to a decrease in volumes.
Previous wording
Gathering, processing and transportation expenses were $4.3 million and $5.0 million for the three months ended September 30, 2024 and 2023, respectively. On a per Boe basis, gathering, processing and transportation expenses were $2.45 and $2.63 for the three months ended September 30, 2024 and 2023, respectively. The change in gathering, processing and transportation expense was primarily due to lower gas volumes and natural gas prices.
Current wording
Gathering, processing and transportation expenses were $4.3 million and $4.8 million for the three months ended March 31, 2025 and 2024, respectively. On a per Boe basis, gathering, processing and transportation expenses were $2.67 and $2.59 for the three months ended March 31, 2025 and 2024, respectively. The change in gathering, processing and transportation expense was primarily due to lower gas volumes.
Previous wording
Taxes other than income were $15.5 million and $16.4 million for the nine months ended September 30, 2024 and 2023, respectively. On a per Boe basis, taxes other than income were $2.86 and $2.95 for the nine months ended September 30, 2024 and 2023, respectively. The decrease was primarily related to a reduction in production taxes and ad valorem taxes for 2024 due to lower natural gas prices, partially offset by an increase in emissions charges.
Current wording
Taxes other than income were $4.4 million and $4.9 million for the three months ended March 31, 2025 and 2024, respectively. On a per Boe basis, taxes other than income were $2.73 and $2.67 for the three months ended March 31, 2025 and 2024, respectively. The decrease was primarily related to a reduction in production taxes due to lower volumes and a decrease in emissions charges.
Previous wording
DD&A expenses were $8.1 million and $7.5 million for the three months ended September 30, 2024 and 2023, respectively. The increase in DD&A expense was primarily driven by increased production at Beta.
Current wording
DD&A expenses were $8.5 million and $8.2 million for the three months ended March 31, 2025 and 2024, respectively.
Previous wording
General and administrative expenses were $26.4 million and $24.5 million for the nine months ended September 30, 2024 and 2023, respectively. The change in general and administrative expenses was primarily related to an increase of $1.5 million in stock compensation expense, an increase of $0.5 million in legal expense, and an increase of $0.5 million in office lease expense related to the early termination of our Oklahoma office lease, partially offset by a $0.2 million decrease in professional services.
Current wording
General and administrative expenses were $10.8 million and $9.8 million for the three months ended March 31, 2025 and 2024, respectively. The change in general and administrative expenses was primarily related to (i) an increase of $1.5 million in legal expenses, (ii) an increase of $0.4 million in stock compensation expense and (iii) an increase of $0.2 million in professional services, partially offset by a decrease of $0.4 million in office lease expense related to the early termination of our Oklahoma office lease in 2024 and a decrease of $0.6 million in salaries and wages.
Previous wording
Net gain on commodity derivative instruments of $7.3 million were recognized for the nine months ended September 30, 2024, consisting of $13.6 million of cash settlements received on expired positions and $0.8 million of cash settlements received on terminated derivative instruments, partially offset by a decrease of $7.1 million in the fair value of open positions. Net loss on commodity derivative instruments of $4.4 million was recognized for the nine months ended September 30, 2023, consisting of $5.1 million of cash settlements paid on expired positions, partially offset by $0.7 million of cash settlement received on terminated derivative instruments and a less than $0.1 million increase in the fair value of open positions.
Current wording
Net loss (gain) on commodity derivative instruments of $14.3 million was recognized for the three months ended March 31, 2025, consisting of a $14.8 million decrease in the fair value of open positions, partially offset by $0.5 million of cash settlements received on expired positions. A net loss on commodity derivative instruments of $16.6 million was recognized for the three months ended March 31, 2024, consisting of a $20.8 million decrease in the fair value of open positions, partially offset by $4.3 million of cash settlements received on expired positions.
Previous wording
Pipeline incident loss was $0.2 million and $0.6 million for the three months ended September 30, 2024 and 2023, respectively. These costs reflect certain expenses not expected to be recovered under an insurance policy. See Note 16 of the Notes to Unaudited Condensed Consolidated Financial Statements included under “Item 1. Financial Statements” of this quarterly report for additional information.
Current wording
Pipeline incident loss was $0.4 million and $0.7 million for the three months ended March 31, 2025 and 2024, respectively. The costs reflect certain expenses not expected to be recovered under an insurance policy. See Note 16 of the Notes to Unaudited Condensed Consolidated Financial Statements included under “Item 1. Financial Statements” of this quarterly report for additional information.
Previous wording
Average outstanding borrowings under our Revolving Credit Facility were $122.5 million and $121.8 million for the three months ended September 30, 2024 and 2023, respectively.
Current wording
Average outstanding borrowings under our Revolving Credit Facility were $127.3 million and $115.2 million for the three months ended March 31, 2025 and 2024, respectively.
Previous wording
Current income tax benefit (expense)was ($0.4) million and ($1.4) million for the three months ended September 30, 2024 and 2023, respectively. See additional information discussed in Note 15 of the Notes to Unaudited Condensed Consolidated Financial Statements included under “Item 1. Financial Statements” of this quarterly report.
Current wording
Current income tax benefit (expense)was less than ($0.1) million and was ($1.4) million for the three months ended March 31, 2025 and 2024, respectively. See additional information discussed in Note 17 of the Notes to Unaudited Condensed Consolidated Financial Statements included under “Item 1. Financial Statements” of this quarterly report.
Previous wording
Current income tax benefit (expense)was ($2.4) million and ($7.1) million for the nine months ended September 30, 2024 and 2023, respectively. See additional information discussed in Note 15 of the Notes to Unaudited Condensed Consolidated Financial Statements included under “Item 1. Financial Statements” of this quarterly report.
Current wording
Deferred income tax benefit (expense)was $1.5 million and $4.7 million for the three months ended March 31, 2025 and 2024, respectively. See additional information discussed in Note 17 of the Notes to Unaudited Condensed Consolidated Financial Statements included under “Item 1. Financial Statements” of this quarterly report.
Previous wording
We include in this report the non-GAAP financial measure of Adjusted EBITDA and provide our reconciliation of Adjusted EBITDA to net income (loss) and net cash flows from operating activities, our most directly comparable financial measures calculated and presented in accordance with GAAP. We define Adjusted EBITDA as net income (loss):
Current wording
We include in this report the non-GAAP financial measure of Adjusted Net Income (Loss) and Adjusted EBITDA and provide our reconciliation of net income (loss) to Adjusted Net Income (Loss), Adjusted EBITDA to net income (loss), and net cash flows from operating activities, our most directly comparable financial measures calculated and presented in accordance with GAAP.
Previous wording
In addition, we use Adjusted EBITDA to evaluate actual cash flow available to develop existing reserves or acquire additional oil and natural gas properties.
Current wording
In addition, we use Adjusted EBITDA as an additional measure to evaluate actual cash flow available to develop existing reserves or acquire additional oil and natural gas properties.
Previous wording
The following tables present our reconciliation of the Company’s net income (loss) and cash flows from operating activities to Adjusted EBITDA, our most directly comparable GAAP financial measures, for each of the periods indicated.
Current wording
The following tables present our reconciliation of the Company’s net income (loss) to Adjusted EBITDA and cash flows from operating activities to Adjusted EBITDA, our most directly comparable GAAP financial measures, for each of the periods indicated.
Previous wording
Overview. Our ability to finance our operations, including funding capital expenditures and acquisitions, to meet our indebtedness obligations, to refinance our indebtedness or to meet our collateral requirements will depend on our ability to generate cash in the future. Our primary sources of liquidity and capital resources have historically been cash flows generated by operating activities and borrowings under our Revolving Credit Facility. As we pursue reserve and production growth, we plan to monitor which capital resources, including equity and debt financings, are available to us to meet our future financial obligations, planned capital expenditure activities and liquidity requirements. Based on our current oil and natural gas price expectations, we believe our cash flows provided by operating activities and availability under our Revolving Credit Facility will provide us with the financial flexibility necessary to meet our cash requirements, including normal operating needs, and to pursue our currently planned 2024 development activities. However, future cash flows are subject to a number of variables, including the level of our oil and natural gas production and the prices we receive for our oil and natural gas production, and significant additional capital expenditures will be required to more fully develop our properties. We cannot assure you that operations and other needed capital will be available on acceptable terms, or at all. For the remainder of 2024, we expect our primary funding sources to be from internally generated cash flow but retain the flexibility to utilize borrowings under our Revolving Credit Facility and/or to access the debt and equity capital markets.
Current wording
Overview. Our ability to finance our operations, including funding capital expenditures and acquisitions, to meet our indebtedness obligations, to refinance our indebtedness or to meet our collateral requirements will depend on our ability to generate cash in the future. Our primary sources of liquidity and capital resources have historically been cash flows generated by operating activities, borrowings under our Revolving Credit Facility and equity and debt capital markets. As we pursue reserve and production growth, we plan to monitor which capital resources, including equity and debt financings, are available to us to meet our future financial obligations, planned capital expenditure activities and liquidity requirements. Based on our current oil and natural gas price expectations, we believe our cash flows provided by operating activities and availability under our Revolving Credit Facility will provide us with the financial flexibility necessary to meet our cash requirements, including normal operating needs, and to pursue our currently planned 2025 development activities. However, future cash flows are subject to a number of variables, including the level of our oil and natural gas production and the prices we receive for our oil and natural gas production, and significant additional capital expenditures will be required to more fully develop our properties. We cannot assure you that operations and other needed capital will be available on acceptable terms, or at all. For the remainder of 2025, we anticipate funding our 2025 capital program from internally generated cash flow but retain the flexibility to utilize borrowings under our Revolving Credit Facility, to access the debt and equity capital markets and continue to evaluate opportunities to optimize our portfolio to reduce debt and accelerate Beta development. We believe that existing cash and cash equivalents, any positive cash flows from operations and available borrowings under our Revolving Credit Facility will be sufficient to support working capital, capital expenditures and other cash requirements for at least the next 12 months and, based on our current expectations, for the foreseeable future thereafter.
Previous wording
Capital Markets. We do not currently anticipate any near-term capital markets activity, but we will continue to evaluate the availability of public debt and equity for funding potential future growth projects and acquisition activity.
Current wording
Capital Markets. We do not currently anticipate any near-term capital markets activity, but we will continue to evaluate the availability of public debt and equity for funding capital needs.
Previous wording
We evaluate counterparty risks related to our commodity derivative contracts and trade credit. Should any of these financial counterparties not perform, we may not realize the benefit of some of our hedges under lower commodity prices.
Current wording
We evaluate counterparty risks related to our commodity derivative contracts and trade credit. Should any of these financial counterparties not perform, we may not realize the benefit of some of our hedges under lower commodity prices. We sell our oil and natural gas to a variety of purchasers. Non-performance by a customer could also result in a loss.
Previous wording
Capital Expenditures. Total capital expenditures were approximately $55.3 million for the nine months ended September 30, 2024, which were primarily related to the development program at Beta, capital workovers and facilities upgrade projects at Beta and in Oklahoma and non-operated drilling and completion activities in East Texas and the Eagle Ford.
Current wording
Capital Expenditures. Our total capital expenditures were approximately $23.1 million for the three months ended March 31, 2025, which were primarily related to the development program at Beta and non-operated drilling and completion activities in East Texas and the Eagle Ford.
Previous wording
Working Capital. Working capital is the amount by which current assets exceed current liabilities. Our working capital requirements are primarily driven by changes in accounts receivable and accounts payable, as well as the classification of our debt outstanding. These changes are impacted by changes in the prices of commodities that we buy and sell. In general, our working capital requirements increase in periods of rising commodity prices and decrease in periods of declining commodity prices. However, our working capital needs do not necessarily change at the same rate as commodity prices because both accounts receivable and accounts payable are impacted by the same commodity prices. In addition, the timing of payments received by our customers or paid to our suppliers can also cause fluctuations in working capital because we settle with most of our larger customers on a monthly basis and often near the end of the month. We expect that our future working capital requirements will be impacted by these same factors.
Current wording
Working Capital. Working capital is the amount by which current assets exceed current liabilities. Our working capital requirements are primarily driven by changes in accounts receivable and accounts payable, as well as the classification of our debt outstanding. These changes are impacted by changes in the prices of commodities that we buy and sell. In general, our working capital requirements increase in periods of rising commodity prices and decrease in periods of declining commodity prices. However, our working capital needs do not necessarily change at the same rate as commodity prices because both accounts receivable and accounts payable are impacted by the same commodity prices. In addition, the timing of payments received by our customers or paid to our suppliers can also cause fluctuations in working capital because we settle with most of our larger customers on a monthly basis and often near the end of the month. We expect that our future working capital requirements will be impacted by these same factors. From time-to-time, our working capital will reflect a deficit, while at other times it will reflect a surplus. This fluctuation is not unusual.
Previous wording
As of September 30, 2024, we had a working capital deficit (excluding commodity derivatives) of $11.6 million primarily due to accrued liabilities of $36.7 million, revenues payable of $11.4 million, and accounts payable of $18.1 million partially offset by accounts receivable of $32.3 million and prepaid expenses of $22.3 million.
Current wording
As of March 31, 2025, we had a working capital deficit (excluding commodity derivatives) of $12.5 million primarily due to accrued liabilities of $40.3 million, revenues payable of $12.5 million, and accounts payable of $19.9 million, partially offset by accounts receivable of $35.9 million and prepaid expenses of $24.3 million. As of March 31, 2025, although we had a working capital deficit, we had $20.0 million of available borrowings as of such date under our Revolving Credit Facility that provides additional liquidity, and therefore we have met all debt covenant ratio requirements as of March 31, 2025.
Previous wording
Revolving Credit Facility. On July 31, 2023, OLLC and Acquisitionco entered into the Revolving Credit Facility. The Revolving Credit Facility is a replacement in full of the Prior Revolving Credit Facility. The aggregate principal amount of loans outstanding under the Revolving Credit Facility as of September 30, 2024, was $120.0 million.
Current wording
Revolving Credit Facility. On July 31, 2023, OLLC and Acquisitionco entered into the Revolving Credit Facility. The aggregate principal amount of loans outstanding under the Revolving Credit Facility as of March 31, 2025, was $125.0 million.
Previous wording
As of September 30, 2024, we had approximately $15.0 million of available borrowings under our Revolving Credit Facility.
Current wording
As of March 31, 2025, we had approximately $20.0 million of available borrowings under our Revolving Credit Facility.
Previous wording
Sinking Fund Payments**.** We have a funding requirement to fund two trust accounts to comply with supplemental regulatory bonding requirements related to our decommissioning obligations for the Beta production facilities. As of September 30, 2024, our future commitments under these agreements were $2.3 million for the remainder of 2024 and $9.0 million per year until the escrow accounts are fully funded. See Note 14 of the Notes to Unaudited Condensed Consolidated Financial Statements included under “Item 1. Financial Statements” of this quarterly report for additional information.
Current wording
Sinking Fund Payments**.** We have a funding requirement to fund two trust accounts to comply with supplemental regulatory bonding requirements related to our decommissioning obligations for the Beta production facilities. As of March 31, 2025, our future commitments under these agreements were $6.8 million for the remainder of 2025 and $9.0 million per year until the escrow accounts are fully funded. See Note 16 of the Notes to Unaudited Condensed Consolidated Financial Statements included under “Item 1. Financial Statements” of this quarterly report for additional information.
Previous wording
The following table summarizes our cash flows from operating, investing and financing activities for the periods indicated. The cash flows for the nine months ended September 30, 2024 and 2023 have been derived from our Unaudited Condensed Consolidated Financial Statements. For information regarding the individual components of our cash flow amounts, see our Unaudited Condensed Consolidated Statements of Cash Flows included under “Item 1. Financial Statements” of this quarterly report.
Current wording
The following table summarizes our cash flows from operating, investing and financing activities for the periods indicated. The cash flows for the three months ended March 31, 2025 and 2024 have been derived from our Unaudited Condensed Consolidated Financial Statements. For information regarding the individual components of our cash flow amounts, see our Unaudited Condensed Consolidated Statements of Cash Flows included under “Item 1. Financial Statements” of this quarterly report.
Previous wording
Operating Activities. Key drivers of net operating cash flows are commodity prices, production volumes and operating costs. Net cash provided by operating activities was $38.8 million and $113.2 million for the nine months ended September 30, 2024 and 2023, respectively. For the nine months ended September 30, 2023, we received $84.9 million in connection with the settlement between the Company and the vessels that struck and damaged the pipeline and their respective owners and operators.
Current wording
Operating Activities. Key drivers of net operating cash flows are commodity prices, production volumes and operating costs. Net cash provided by operating activities was $25.5 million and $7.7 million for the three months ended March 31, 2025 and 2024, respectively.
Previous wording
Production volumes were approximately 19.8 MBoe/d and 20.4 MBoe/d for the nine months ended September 30, 2024 and 2023, respectively. The average realized sales price was $39.69 per Boe and $37.72 per Boe for the nine months ended September 30, 2024 and 2023, respectively. The change in realized sales prices was primarily due to higher commodity prices, Beta returning to production after being offline for the first quarter of 2023 and the release of revenue suspense of $8.4 million.
Current wording
Production volumes were approximately 17.9 MBoe/d and 20.2 MBoe/d for the three months ended March 31, 2025 and 2024, respectively. The average realized sales price was $43.76 per Boe and $40.89 per Boe for the three months ended March 31, 2025 and 2024, respectively. The change in realized sales prices was due to higher natural gas and NGL prices, partially offset by lower realized sales prices for oil. In addition, oil production had a higher percentage of total production in the first quarter of 2025 when compared to the first quarter of 2024.
Previous wording
Net cash provided by operating activities for the nine months ended September 30, 2024 included $13.6 million of cash received on expired commodity derivative instruments compared to $5.1 million of cash paid on expired commodity derivatives for the nine months ended September 30, 2023. For the nine months ended September 30, 2024, we had a net gain on commodity derivative instruments of $7.3 million compared to a net loss of $4.4 million for the nine months ended September 30, 2023.
Current wording
Net cash provided by operating activities for the three months ended March 31, 2025 included $0.5 million of cash received on expired commodity derivative instruments compared to $4.3 million of cash received on expired commodity derivatives for the three months ended March 31, 2024. For the three months ended March 31, 2025, we had a net loss on commodity derivative instruments of $14.3 million compared to a net loss of $16.6 million for the three months ended March 31, 2024.
Previous wording
Investing Activities. Net cash used in investing activities for the nine months ended September 30, 2024 was $62.7 million, of which $54.1 million was used for additions to oil and natural gas properties and $1.0 million for additions to other property and equipment. Net cash used in investing activities for the nine months ended September 30, 2023 was $30.0 million, of which $23.1 million was used for additions to oil and natural gas properties and $0.5 million for additions to other property and equipment.
Current wording
Investing Activities. Net cash used in investing activities for the three months ended March 31, 2025 was $21.5 million, of which $24.9 million was used for additions to oil and natural gas properties and $0.3 million for additions to other property and equipment. Net cash used in investing activities for the three months ended March 31, 2024 was $23.7 million, of which $19.1 million was used for additions to oil and natural gas properties. In addition, we had a decrease of $1.5 million in our capital expenditures payable account.
Previous wording
Various restricted investment accounts fund certain long-term contractual and regulatory asset retirement obligations and collateralize certain regulatory bonds associated with our Beta properties. Additions to restricted investments were $7.5 million and $6.4 million during the nine months ended September 30, 2024 and 2023, respectively.
Current wording
Various restricted investment accounts fund certain long-term contractual and regulatory asset retirement obligations and collateralize certain regulatory bonds associated with our Beta properties. Additions to restricted investments were $2.5 million for the three months ended March 31, 2025 and 2024, respectively.
Previous wording
Financing Activities**.** We had net borrowings of $5.0 million for the nine months ended September 30, 2024 related to our Revolving Credit Facility compared to net repayments of $70.0 million for the nine months ended September 30, 2023. Shares withheld for taxes was $1.9 million and $2.2 million for the nine months ended September 30, 2024 and 2023, respectively.
Current wording
Financing Activities**.** We had net repayments of $2.0 million for the three months ended March 31, 2025 related to our Revolving Credit Facility compared to repayments of $25.0 million for the three months ended March 31, 2024. Shares withheld for taxes was $2.0 million and $1.7 million for the three months ended March 31, 2025 and 2024, respectively.
Rearranged current paragraphs (1)
Current report — wording carried from elsewhere
The following tables present our reconciliation of the Company’s net income (loss) to Adjusted Net Income (Loss), our most directly comparable GAAP financial measures, for each of the periods indicated.
Rearranged previous paragraphs (1)
Previous report — wording carried elsewhere
Pipeline incident loss was $1.5 million and $15.7 million for the nine months ended September 30, 2024 and 2023, respectively. The costs reflect certain expenses not expected to be recovered under an insurance policy. See Note 16 of the Notes to Unaudited Condensed Consolidated Financial Statements included under “Item 1. Financial Statements” of this quarterly report for additional information.