|
|
|
|
Delaware
|
46-3472728
|
(State or Other Jurisdiction of
Incorporation or Organization)
|
(I.R.S. Employer
Identification No.)
|
|
|
1001 Louisiana Street
Houston, Texas
|
77002
|
(Address of Principal Executive Offices)
|
(Zip Code)
|
|
Large accelerated filer
o
|
|
Accelerated filer
x
|
|
|
|
Non-accelerated filer
o
|
|
Smaller reporting company
x
|
|
|
|
Emerging Growth Company
o
|
|
|
|
Caption
|
Page
|
|
|
||
|
|
|
|
|
|
|
||
|
|
|
|
/d
|
=
|
per day
|
Bbl
|
=
|
barrel
|
Boe
|
=
|
barrel of oil equivalent
|
Gal
|
=
|
gallons
|
LLS
|
=
|
light Louisiana sweet crude oil
|
MBoe
|
=
|
thousand barrels of oil equivalent
|
MBbls
|
=
|
thousand barrels
|
Mcf
|
=
|
thousand cubic feet
|
MMBtu
|
=
|
million British thermal units
|
MMBbls
|
=
|
million barrels
|
MMcf
|
=
|
million cubic feet
|
MMGal
|
=
|
million gallons
|
Mt. Belvieu
|
=
|
Mont Belvieu natural gas liquids pricing index
|
NGLs
|
=
|
natural gas liquids
|
NYMEX
|
=
|
New York Mercantile Exchange
|
TBtu
|
=
|
trillion British thermal units
|
WTI
|
=
|
West Texas intermediate
|
|
Quarter ended
September 30, |
|
Nine months ended
September 30, |
||||||||||||
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||||||
Operating revenues
|
|
|
|
|
|
|
|
|
|
|
|
||||
Oil
|
$
|
287
|
|
|
$
|
189
|
|
|
$
|
820
|
|
|
$
|
595
|
|
Natural gas
|
15
|
|
|
27
|
|
|
55
|
|
|
84
|
|
||||
NGLs
|
36
|
|
|
26
|
|
|
92
|
|
|
71
|
|
||||
Financial derivatives
|
(44
|
)
|
|
(23
|
)
|
|
(122
|
)
|
|
92
|
|
||||
Total operating revenues
|
294
|
|
|
219
|
|
|
845
|
|
|
842
|
|
||||
|
|
|
|
|
|
|
|
||||||||
Operating expenses
|
|
|
|
|
|
|
|
|
|
|
|
||||
Oil and natural gas purchases
|
3
|
|
|
—
|
|
|
3
|
|
|
2
|
|
||||
Transportation costs
|
25
|
|
|
29
|
|
|
76
|
|
|
86
|
|
||||
Lease operating expense
|
46
|
|
|
42
|
|
|
123
|
|
|
121
|
|
||||
General and administrative
|
21
|
|
|
25
|
|
|
68
|
|
|
71
|
|
||||
Depreciation, depletion and amortization
|
127
|
|
|
118
|
|
|
376
|
|
|
368
|
|
||||
Gain on sale of assets
|
(1
|
)
|
|
—
|
|
|
(1
|
)
|
|
—
|
|
||||
Impairment charges
|
—
|
|
|
1
|
|
|
—
|
|
|
2
|
|
||||
Exploration and other expense
|
2
|
|
|
6
|
|
|
3
|
|
|
10
|
|
||||
Taxes, other than income taxes
|
22
|
|
|
16
|
|
|
63
|
|
|
50
|
|
||||
Total operating expenses
|
245
|
|
|
237
|
|
|
711
|
|
|
710
|
|
||||
|
|
|
|
|
|
|
|
||||||||
Operating income (loss)
|
49
|
|
|
(18
|
)
|
|
134
|
|
|
132
|
|
||||
Other income
|
2
|
|
|
—
|
|
|
2
|
|
|
—
|
|
||||
Gain (loss) on extinguishment/modification of debt
|
—
|
|
|
24
|
|
|
48
|
|
|
(16
|
)
|
||||
Interest expense
|
(95
|
)
|
|
(80
|
)
|
|
(268
|
)
|
|
(245
|
)
|
||||
Loss before income taxes
|
(44
|
)
|
|
(74
|
)
|
|
(84
|
)
|
|
(129
|
)
|
||||
Income tax benefit
|
—
|
|
|
2
|
|
|
—
|
|
|
7
|
|
||||
Net loss
|
$
|
(44
|
)
|
|
$
|
(72
|
)
|
|
$
|
(84
|
)
|
|
$
|
(122
|
)
|
|
|
|
|
|
|
|
|
||||||||
Basic and diluted net income (loss) per common share
|
|
|
|
|
|
|
|
|
|
|
|
||||
Net loss
|
$
|
(0.18
|
)
|
|
$
|
(0.29
|
)
|
|
$
|
(0.34
|
)
|
|
$
|
(0.50
|
)
|
Basic and diluted weighted average common shares outstanding
|
248
|
|
|
246
|
|
|
247
|
|
|
246
|
|
|
September 30, 2018
|
|
December 31, 2017
|
||||
ASSETS
|
|
|
|
|
|
||
Current assets
|
|
|
|
|
|
||
Cash and cash equivalents
|
$
|
56
|
|
|
$
|
27
|
|
Restricted cash
|
—
|
|
|
18
|
|
||
Accounts receivable
|
|
|
|
|
|
||
Customer, net of allowance of less than $1 in 2018 and 2017
|
182
|
|
|
158
|
|
||
Other, net of allowance of $1 in 2018 and 2017
|
56
|
|
|
13
|
|
||
Income tax receivable
|
—
|
|
|
9
|
|
||
Materials and supplies
|
15
|
|
|
16
|
|
||
Derivative instruments
|
—
|
|
|
18
|
|
||
Assets held for sale
|
—
|
|
|
172
|
|
||
Prepaid assets
|
6
|
|
|
35
|
|
||
Total current assets
|
315
|
|
|
466
|
|
||
Property, plant and equipment, at cost
|
|
|
|
|
|
||
Oil and natural gas properties
|
8,392
|
|
|
7,532
|
|
||
Other property, plant and equipment
|
75
|
|
|
69
|
|
||
|
8,467
|
|
|
7,601
|
|
||
Less accumulated depreciation, depletion and amortization
|
3,554
|
|
|
3,179
|
|
||
Total property, plant and equipment, net
|
4,913
|
|
|
4,422
|
|
||
Other assets
|
|
|
|
|
|
||
Derivative instruments
|
1
|
|
|
4
|
|
||
Unamortized debt issue costs - revolving credit facility
|
8
|
|
|
6
|
|
||
Other
|
2
|
|
|
2
|
|
||
|
11
|
|
|
12
|
|
||
Total assets
|
$
|
5,239
|
|
|
$
|
4,900
|
|
|
September 30, 2018
|
|
December 31, 2017
|
||||
LIABILITIES AND EQUITY
|
|
|
|
|
|
||
Current liabilities
|
|
|
|
|
|
||
Accounts payable
|
|
|
|
|
|
||
Trade
|
$
|
119
|
|
|
$
|
88
|
|
Other
|
158
|
|
|
158
|
|
||
Derivative instruments
|
71
|
|
|
17
|
|
||
Accrued interest
|
112
|
|
|
62
|
|
||
Liabilities related to assets held for sale
|
—
|
|
|
2
|
|
||
Short-term debt, net of debt issue costs
|
8
|
|
|
21
|
|
||
Other accrued liabilities
|
95
|
|
|
100
|
|
||
Total current liabilities
|
563
|
|
|
448
|
|
||
|
|
|
|
||||
Long-term debt, net of debt issue costs
|
4,295
|
|
|
4,022
|
|
||
Other long-term liabilities
|
|
|
|
|
|
||
Derivative instruments
|
12
|
|
|
—
|
|
||
Asset retirement obligations
|
39
|
|
|
33
|
|
||
Other
|
13
|
|
|
5
|
|
||
Total non-current liabilities
|
4,359
|
|
|
4,060
|
|
||
|
|
|
|
||||
Commitments and contingencies (Note 8)
|
|
|
|
|
|
||
|
|
|
|
||||
Stockholders’ equity
|
|
|
|
|
|
||
Class A shares, $0.01 par value; 550 million shares authorized; 257 million shares issued and outstanding at September 30, 2018; 252 million shares issued and outstanding at December 31, 2017
|
3
|
|
|
3
|
|
||
Class B shares, $0.01 par value; less than one million shares authorized, issued and outstanding at September 30, 2018 and December 31, 2017
|
—
|
|
|
—
|
|
||
Preferred stock, $0.01 par value; 50 million shares authorized; no shares issued or outstanding
|
—
|
|
|
—
|
|
||
Treasury stock (at cost), less than one million shares at September 30, 2018 and December 31, 2017
|
—
|
|
|
(3
|
)
|
||
Additional paid-in capital
|
3,532
|
|
|
3,526
|
|
||
Accumulated deficit
|
(3,218
|
)
|
|
(3,134
|
)
|
||
Total stockholders’ equity
|
317
|
|
|
392
|
|
||
Total liabilities and equity
|
$
|
5,239
|
|
|
$
|
4,900
|
|
|
Nine months ended
September 30, |
||||||
|
2018
|
|
2017
|
||||
Cash flows from operating activities
|
|
|
|
|
|
||
Net loss
|
$
|
(84
|
)
|
|
$
|
(122
|
)
|
Adjustments to reconcile net loss to net cash provided by operating activities
|
|
|
|
|
|
||
Depreciation, depletion and amortization
|
376
|
|
|
368
|
|
||
Gain on sale of assets
|
(1
|
)
|
|
—
|
|
||
Impairment charges
|
—
|
|
|
2
|
|
||
(Gain) loss on extinguishment/modification of debt
|
(48
|
)
|
|
16
|
|
||
Other non-cash income items
|
22
|
|
|
24
|
|
||
Asset and liability changes
|
|
|
|
|
|
||
Accounts receivable
|
(68
|
)
|
|
(25
|
)
|
||
Accounts payable
|
18
|
|
|
26
|
|
||
Derivative instruments
|
87
|
|
|
(7
|
)
|
||
Accrued interest
|
50
|
|
|
40
|
|
||
Other asset changes
|
15
|
|
|
(12
|
)
|
||
Other liability changes
|
13
|
|
|
(12
|
)
|
||
Net cash provided by operating activities
|
380
|
|
|
298
|
|
||
|
|
|
|
||||
Cash flows from investing activities
|
|
|
|
|
|
||
Cash paid for capital expenditures
|
(559
|
)
|
|
(405
|
)
|
||
Proceeds from the sale of assets
|
175
|
|
|
—
|
|
||
Cash paid for acquisitions
|
(275
|
)
|
|
(29
|
)
|
||
Net cash used in investing activities
|
(659
|
)
|
|
(434
|
)
|
||
|
|
|
|
||||
Cash flows from financing activities
|
|
|
|
|
|
||
Proceeds from issuance of long-term debt
|
1,805
|
|
|
1,645
|
|
||
Repayments and repurchases of long-term debt
|
(1,431
|
)
|
|
(1,484
|
)
|
||
Fees/costs on debt exchange
|
(62
|
)
|
|
—
|
|
||
Debt issue costs
|
(21
|
)
|
|
(21
|
)
|
||
Other
|
(1
|
)
|
|
(3
|
)
|
||
Net cash provided by financing activities
|
290
|
|
|
137
|
|
||
|
|
|
|
||||
Change in cash, cash equivalents and restricted cash
|
11
|
|
|
1
|
|
||
|
|
|
|
|
|
||
Cash, cash equivalents and restricted cash - beginning of period
|
45
|
|
|
20
|
|
||
Cash, cash equivalents and restricted cash - end of period
|
$
|
56
|
|
|
$
|
21
|
|
|
Class A Stock
|
|
Class B Stock
|
|
Treasury Stock
|
|
Additional
Paid-in Capital
|
|
Retained Earnings (Accumulated Deficit)
|
|
|
||||||||||||||||||
|
Shares
|
|
Amount
|
|
Shares
|
|
Amount
|
|
|
|
|
Total
|
|||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Balance at December 31, 2016
|
251
|
|
|
$
|
2
|
|
|
0.8
|
|
|
$
|
—
|
|
|
$
|
(3
|
)
|
|
$
|
3,546
|
|
|
$
|
(2,939
|
)
|
|
$
|
606
|
|
Cumulative effect of accounting change
|
—
|
|
|
$
|
—
|
|
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
1
|
|
|
$
|
(1
|
)
|
|
$
|
—
|
|
Balance at January 1, 2017
|
251
|
|
|
$
|
2
|
|
|
0.8
|
|
|
$
|
—
|
|
|
$
|
(3
|
)
|
|
$
|
3,547
|
|
|
$
|
(2,940
|
)
|
|
$
|
606
|
|
Share-based compensation
|
4
|
|
|
1
|
|
|
(0.1
|
)
|
|
—
|
|
|
—
|
|
|
(4
|
)
|
|
—
|
|
|
(3
|
)
|
||||||
Net loss
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(47
|
)
|
|
(47
|
)
|
||||||
Balance at March 31, 2017
|
255
|
|
|
$
|
3
|
|
|
0.7
|
|
|
$
|
—
|
|
|
$
|
(3
|
)
|
|
$
|
3,543
|
|
|
$
|
(2,987
|
)
|
|
$
|
556
|
|
Share-based compensation
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
6
|
|
|
—
|
|
|
6
|
|
||||||
Net loss
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(3
|
)
|
|
(3
|
)
|
||||||
Balance at June 30, 2017
|
255
|
|
|
$
|
3
|
|
|
0.7
|
|
|
$
|
—
|
|
|
$
|
(3
|
)
|
|
$
|
3,549
|
|
|
$
|
(2,990
|
)
|
|
$
|
559
|
|
Share-based compensation
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
4
|
|
|
—
|
|
|
4
|
|
||||||
Net loss
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(72
|
)
|
|
(72
|
)
|
||||||
Balance at September 30, 2017
|
255
|
|
|
$
|
3
|
|
|
0.7
|
|
|
$
|
—
|
|
|
$
|
(3
|
)
|
|
$
|
3,553
|
|
|
$
|
(3,062
|
)
|
|
$
|
491
|
|
Share-based compensation
|
(3
|
)
|
|
—
|
|
|
(0.4
|
)
|
|
—
|
|
|
—
|
|
|
(27
|
)
|
|
—
|
|
|
(27
|
)
|
||||||
Net loss
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(72
|
)
|
|
(72
|
)
|
||||||
Balance at December 31, 2017
|
252
|
|
|
$
|
3
|
|
|
0.3
|
|
|
$
|
—
|
|
|
$
|
(3
|
)
|
|
$
|
3,526
|
|
|
$
|
(3,134
|
)
|
|
$
|
392
|
|
Share-based compensation
|
(1
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(1
|
)
|
|
1
|
|
|
—
|
|
|
—
|
|
||||||
Net income
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
18
|
|
|
18
|
|
||||||
Balance at March 31, 2018
|
251
|
|
|
$
|
3
|
|
|
0.3
|
|
|
$
|
—
|
|
|
$
|
(4
|
)
|
|
$
|
3,527
|
|
|
$
|
(3,116
|
)
|
|
$
|
410
|
|
Share-based compensation
|
6
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
4
|
|
|
(1
|
)
|
|
—
|
|
|
3
|
|
||||||
Net loss
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(58
|
)
|
|
(58
|
)
|
||||||
Balance at June 30, 2018
|
257
|
|
|
$
|
3
|
|
|
0.3
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
3,526
|
|
|
$
|
(3,174
|
)
|
|
$
|
355
|
|
Share-based compensation
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
6
|
|
|
—
|
|
|
6
|
|
||||||
Net loss
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(44
|
)
|
|
(44
|
)
|
||||||
Balance at September 30, 2018
|
257
|
|
|
$
|
3
|
|
|
0.3
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
3,532
|
|
|
$
|
(3,218
|
)
|
|
$
|
317
|
|
|
September 30, 2018
|
|
December 31, 2017
|
||||||||||||
|
Carrying
Amount
|
|
Fair
Value
|
|
Carrying
Amount
|
|
Fair
Value
|
||||||||
|
(in millions)
|
||||||||||||||
Short-term debt
|
$
|
8
|
|
|
$
|
8
|
|
|
$
|
21
|
|
|
$
|
19
|
|
|
|
|
|
|
|
|
|
||||||||
Long-term debt (see Note 7)
|
$
|
4,395
|
|
|
$
|
3,808
|
|
|
$
|
4,072
|
|
|
$
|
3,248
|
|
|
|
|
|
|
|
|
|
||||||||
Derivative instruments
|
$
|
(82
|
)
|
|
$
|
(82
|
)
|
|
$
|
5
|
|
|
$
|
5
|
|
|
Level 2
|
||||||||||||||||||||||||||||||
|
Derivative Assets
|
|
Derivative Liabilities
|
||||||||||||||||||||||||||||
|
Gross
Fair Value
|
|
|
|
Balance Sheet Location
|
|
Gross
Fair Value
|
|
|
|
Balance Sheet Location
|
||||||||||||||||||||
|
|
Impact of
Netting
|
|
Current
|
|
Non-
current
|
|
|
Impact of
Netting
|
|
Current
|
|
Non-
current
|
||||||||||||||||||
|
(in millions)
|
|
(in millions)
|
||||||||||||||||||||||||||||
September 30, 2018
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Derivative instruments
|
$
|
21
|
|
|
$
|
(20
|
)
|
|
$
|
—
|
|
|
$
|
1
|
|
|
$
|
(103
|
)
|
|
$
|
20
|
|
|
$
|
(71
|
)
|
|
$
|
(12
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
December 31, 2017
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Derivative instruments
|
$
|
33
|
|
|
$
|
(11
|
)
|
|
$
|
18
|
|
|
$
|
4
|
|
|
$
|
(28
|
)
|
|
$
|
11
|
|
|
$
|
(17
|
)
|
|
$
|
—
|
|
|
September 30, 2018
|
|
December 31, 2017
|
|||||
|
(in millions)
|
|||||||
Proved
|
|
|
|
|||||
Eagle Ford
|
$
|
3,865
|
|
|
$
|
3,219
|
|
|
Permian
|
2,831
|
|
|
2,705
|
|
|||
Northeastern Utah (formerly Altamont)
|
1,637
|
|
|
1,542
|
|
|||
Total Proved
|
8,333
|
|
|
7,466
|
|
|||
Unproved
|
|
|
|
|||||
Permian
|
59
|
|
|
66
|
|
|||
Less accumulated depletion
|
(3,512
|
)
|
|
(3,137
|
)
|
|||
Net capitalized costs for oil and natural gas properties
|
$
|
4,880
|
|
|
$
|
4,395
|
|
|
2018
|
||
|
(in millions)
|
||
Net asset retirement liability at January 1
|
$
|
35
|
|
Liabilities incurred
|
1
|
|
|
Accretion expense
|
2
|
|
|
Changes in estimate
|
3
|
|
|
Net asset retirement liability at September 30
|
$
|
41
|
|
|
Interest Rate
|
|
September 30, 2018
|
|
December 31, 2017
|
||||
|
|
|
(in millions)
|
||||||
RBL credit facility - due November 23, 2021
(1)
|
Variable
|
|
$
|
—
|
|
|
$
|
595
|
|
Senior secured term loans:
|
|
|
|
|
|
||||
Due May 24, 2018
(2)(3)
|
Variable
|
|
—
|
|
|
21
|
|
||
Due April 30, 2019
(4)
|
Variable
|
|
8
|
|
|
8
|
|
||
Senior secured notes:
|
|
|
|
|
|
||||
Due May 1, 2024
|
9.375%
|
|
1,092
|
|
|
—
|
|
||
Due November 29, 2024
|
8.00%
|
|
500
|
|
|
500
|
|
||
Due February 15, 2025
|
8.00%
|
|
1,000
|
|
|
1,000
|
|
||
Due May 15, 2026
|
7.75%
|
|
1,000
|
|
|
—
|
|
||
Senior unsecured notes:
|
|
|
|
|
|
||||
Due May 1, 2020
|
9.375%
|
|
246
|
|
|
1,200
|
|
||
Due September 1, 2022
|
7.75%
|
|
195
|
|
|
250
|
|
||
Due June 15, 2023
|
6.375%
|
|
362
|
|
|
519
|
|
||
Total debt
|
|
|
4,403
|
|
|
4,093
|
|
||
Less short-term debt, net of debt issue costs of less than $1 million
|
|
|
(8
|
)
|
|
(21
|
)
|
||
Total long-term debt
|
|
|
4,395
|
|
|
4,072
|
|
||
Less debt discount and non-current portion of unamortized debt issue costs
(5)
|
|
|
(100
|
)
|
|
(50
|
)
|
||
Total long-term debt, net
|
|
|
$
|
4,295
|
|
|
$
|
4,022
|
|
|
(1)
|
Carries interest at a specified margin over
LIBOR
of
2.50%
to
3.50%
, based on borrowing utilization.
|
(3)
|
In April 2018, we retired the term loan in full.
|
(5)
|
Includes debt discount of
$44 million
and less than
$1 million
as of September 30, 2018 and December 31, 2017, respectively, associated with our senior secured notes maturing in 2024 and unamortized debt issue costs of
$64 million
and
$56 million
as of September 30, 2018 and December 31, 2017, respectively.
|
|
|
Quarter ended September 30,
|
|
Nine months ended September 30,
|
||||||||
|
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||
|
|
(in millions)
|
||||||||||
Debt repurchased - face value
(1)
|
|
—
|
|
|
101
|
|
|
19
|
|
|
157
|
|
Cash paid
|
|
—
|
|
|
76
|
|
|
10
|
|
|
118
|
|
Gain on extinguishment of debt
(2)
|
|
—
|
|
|
24
|
|
|
9
|
|
|
37
|
|
|
(1)
|
In 2018 and 2017, repurchases were associated with 2022 and 2023 senior unsecured notes and 2020 and 2023 senior unsecured notes, respectively.
|
|
|
Number of Shares
|
|
Weighted Average
Grant Date Fair Value
per Share
|
|||
Non-vested at December 31, 2017
|
|
5,283,986
|
|
|
$
|
4.93
|
|
Granted
|
|
6,905,525
|
|
|
$
|
1.94
|
|
Vested
|
|
(1,891,999
|
)
|
|
$
|
5.65
|
|
Forfeited
|
|
(1,411,984
|
)
|
|
$
|
4.27
|
|
Non-vested at September 30, 2018
|
|
8,885,528
|
|
|
$
|
2.56
|
|
|
|
2018
|
|
2019
|
||||||||||
|
|
Volumes
(1)
|
|
Average
Price
(1)
|
|
Volumes
(1)
|
|
Average
Price
(1)
|
||||||
Oil
|
|
|
|
|
|
|
|
|
|
|
||||
Fixed Price Swaps
|
|
|
|
|
|
|
|
|
|
|
||||
WTI
|
|
1,288
|
|
|
$
|
56.49
|
|
|
730
|
|
|
$
|
55.88
|
|
Collars
|
|
|
|
|
|
|
|
|
||||||
Ceiling - WTI
|
|
276
|
|
|
$
|
64.98
|
|
|
1,275
|
|
|
$
|
65.80
|
|
Floors - WTI
|
|
276
|
|
|
$
|
55.00
|
|
|
1,275
|
|
|
$
|
55.00
|
|
Three Way Collars
|
|
|
|
|
|
|
|
|
||||||
Ceiling - WTI
|
|
2,233
|
|
|
$
|
68.15
|
|
|
7,300
|
|
|
$
|
68.66
|
|
Floors - WTI
|
|
2,233
|
|
|
$
|
60.00
|
|
|
7,300
|
|
|
$
|
58.50
|
|
Sub-Floor - WTI
|
|
2,233
|
|
|
$
|
50.00
|
|
|
7,300
|
|
|
$
|
45.00
|
|
Basis Swaps
|
|
|
|
|
|
|
|
|
||||||
LLS vs. WTI
(2)
|
|
1,288
|
|
|
$
|
2.84
|
|
|
—
|
|
|
$
|
—
|
|
Midland vs. Cushing
(3)
|
|
920
|
|
|
$
|
(1.02
|
)
|
|
1,095
|
|
|
$
|
(6.47
|
)
|
NYMEX Roll
(4)
|
|
920
|
|
|
$
|
0.09
|
|
|
—
|
|
|
$
|
—
|
|
Natural Gas
|
|
|
|
|
|
|
|
|
||||||
Fixed Price Swaps
|
|
7
|
|
|
$
|
3.04
|
|
|
7
|
|
|
$
|
2.97
|
|
Basis Swaps
|
|
|
|
|
|
|
|
|
||||||
WAHA vs. Henry Hub
(5)
|
|
4
|
|
|
$
|
(0.46
|
)
|
|
7
|
|
|
$
|
(0.39
|
)
|
NGLs
|
|
|
|
|
|
|
|
|
||||||
Fixed Price Swaps - Ethane
|
|
15
|
|
|
$
|
0.30
|
|
|
—
|
|
|
$
|
—
|
|
Fixed Price Swaps - Propane
|
|
8
|
|
|
$
|
0.75
|
|
|
—
|
|
|
$
|
—
|
|
|
(1)
|
Volumes presented are MBbls for oil, TBtu for natural gas and MMGal for NGLs. Prices presented are per Bbl of oil, MMBtu of natural gas and Gal for NGLs.
|
(2)
|
EP Energy receives WTI plus the basis spread listed and pays LLS.
|
(3)
|
EP Energy receives Cushing plus the basis spread listed and pays Midland. These positions do not include 184 MBbls of oil at an average price of $1.08 per barrel of oil, which offset our 1.1 MBbls Midland vs. Cushing basis swaps positions.
|
(4)
|
These positions hedge the timing risk associated with our physical sales. We generally sell oil for the delivery month at a sales price based on the average NYMEX WTI
|
(5)
|
EP Energy receives Henry Hub plus the basis spread listed and pays WAHA.
|
|
Quarter ended
September 30, |
|
Nine months ended
September 30, |
||||||||
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||
Equivalent Volumes (MBoe/d)
|
|
|
|
|
|
|
|
|
|
||
Eagle Ford Shale
|
35.8
|
|
|
32.9
|
|
|
37.0
|
|
|
37.4
|
|
Permian
|
27.1
|
|
|
29.9
|
|
|
26.8
|
|
|
27.6
|
|
Northeastern Utah (formerly Altamont)
|
17.5
|
|
|
18.2
|
|
|
17.2
|
|
|
17.8
|
|
Total
|
80.4
|
|
|
81.0
|
|
|
81.0
|
|
|
82.8
|
|
|
|
|
|
|
|
|
|
||||
Oil (MBbls/d)
|
|
|
|
|
|
|
|
||||
Eagle Ford Shale
|
25.6
|
|
|
20.0
|
|
|
25.2
|
|
|
23.4
|
|
Permian
|
8.8
|
|
|
12.6
|
|
|
9.4
|
|
|
11.2
|
|
Northeastern Utah
|
12.0
|
|
|
12.5
|
|
|
11.8
|
|
|
12.4
|
|
Total
|
46.4
|
|
|
45.1
|
|
|
46.4
|
|
|
47.0
|
|
|
|
|
|
|
|
|
|
||||
Natural Gas (MMcf/d)
|
|
|
|
|
|
|
|
||||
Eagle Ford Shale
(1)
|
30
|
|
|
37
|
|
|
35
|
|
|
41
|
|
Permian
|
58
|
|
|
55
|
|
|
56
|
|
|
52
|
|
Northeastern Utah
|
33
|
|
|
34
|
|
|
32
|
|
|
33
|
|
Total
|
121
|
|
|
126
|
|
|
123
|
|
|
126
|
|
|
|
|
|
|
|
|
|
||||
NGLs (MBbls/d)
|
|
|
|
|
|
|
|
||||
Eagle Ford Shale
|
5.2
|
|
|
6.7
|
|
|
6.0
|
|
|
7.2
|
|
Permian
|
8.7
|
|
|
8.2
|
|
|
8.1
|
|
|
7.6
|
|
Northeastern Utah
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
Total
|
13.9
|
|
|
14.9
|
|
|
14.1
|
|
|
14.8
|
|
|
|
Quarter ended
September 30, |
|
Nine months ended
September 30, |
||||||||||||
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||||||
|
(in millions)
|
||||||||||||||
Operating revenues
|
|
|
|
|
|
|
|
|
|
|
|
||||
Oil
|
$
|
287
|
|
|
$
|
189
|
|
|
$
|
820
|
|
|
$
|
595
|
|
Natural gas
|
15
|
|
|
27
|
|
|
55
|
|
|
84
|
|
||||
NGLs
|
36
|
|
|
26
|
|
|
92
|
|
|
71
|
|
||||
Total physical sales
|
338
|
|
|
242
|
|
|
967
|
|
|
750
|
|
||||
Financial derivatives
|
(44
|
)
|
|
(23
|
)
|
|
(122
|
)
|
|
92
|
|
||||
Total operating revenues
|
294
|
|
|
219
|
|
|
845
|
|
|
842
|
|
||||
|
|
|
|
|
|
|
|
||||||||
Operating expenses
|
|
|
|
|
|
|
|
|
|
|
|
||||
Oil and natural gas purchases
|
3
|
|
|
—
|
|
|
3
|
|
|
2
|
|
||||
Transportation costs
|
25
|
|
|
29
|
|
|
76
|
|
|
86
|
|
||||
Lease operating expense
|
46
|
|
|
42
|
|
|
123
|
|
|
121
|
|
||||
General and administrative
|
21
|
|
|
25
|
|
|
68
|
|
|
71
|
|
||||
Depreciation, depletion and amortization
|
127
|
|
|
118
|
|
|
376
|
|
|
368
|
|
||||
Gain on sale of assets
|
(1
|
)
|
|
—
|
|
|
(1
|
)
|
|
—
|
|
||||
Impairment charges
|
—
|
|
|
1
|
|
|
—
|
|
|
2
|
|
||||
Exploration and other expense
|
2
|
|
|
6
|
|
|
3
|
|
|
10
|
|
||||
Taxes, other than income taxes
|
22
|
|
|
16
|
|
|
63
|
|
|
50
|
|
||||
Total operating expenses
|
245
|
|
|
237
|
|
|
711
|
|
|
710
|
|
||||
|
|
|
|
|
|
|
|
||||||||
Operating income (loss)
|
49
|
|
|
(18
|
)
|
|
134
|
|
|
132
|
|
||||
Other income
|
2
|
|
|
—
|
|
|
2
|
|
|
—
|
|
||||
Gain (loss) on extinguishment/modification of debt
|
—
|
|
|
24
|
|
|
48
|
|
|
(16
|
)
|
||||
Interest expense
|
(95
|
)
|
|
(80
|
)
|
|
(268
|
)
|
|
(245
|
)
|
||||
Loss before income taxes
|
(44
|
)
|
|
(74
|
)
|
|
(84
|
)
|
|
(129
|
)
|
||||
Income tax benefit
|
—
|
|
|
2
|
|
|
—
|
|
|
7
|
|
||||
Net loss
|
$
|
(44
|
)
|
|
$
|
(72
|
)
|
|
$
|
(84
|
)
|
|
$
|
(122
|
)
|
|
Quarter ended
September 30, |
|
Nine months ended
September 30, |
||||||||||||
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||||||
|
(in millions)
|
||||||||||||||
Operating revenues:
|
|
|
|
|
|
|
|
|
|
|
|
||||
Oil
|
$
|
287
|
|
|
$
|
189
|
|
|
$
|
820
|
|
|
$
|
595
|
|
Natural gas
|
15
|
|
|
27
|
|
|
55
|
|
|
84
|
|
||||
NGLs
|
36
|
|
|
26
|
|
|
92
|
|
|
71
|
|
||||
Total physical sales
|
338
|
|
|
242
|
|
|
967
|
|
|
750
|
|
||||
Financial derivatives
|
(44
|
)
|
|
(23
|
)
|
|
(122
|
)
|
|
92
|
|
||||
Total operating revenues
|
$
|
294
|
|
|
$
|
219
|
|
|
$
|
845
|
|
|
$
|
842
|
|
|
|
|
|
|
|
|
|
||||||||
Volumes:
|
|
|
|
|
|
|
|
|
|
|
|
||||
Oil (MBbls)
|
4,262
|
|
|
4,153
|
|
|
12,648
|
|
|
12,824
|
|
||||
Natural gas (MMcf)
|
11,121
|
|
|
11,563
|
|
|
33,730
|
|
|
34,381
|
|
||||
NGLs (MBbls)
|
1,285
|
|
|
1,376
|
|
|
3,851
|
|
|
4,058
|
|
||||
Equivalent volumes (MBoe)
|
7,401
|
|
|
7,456
|
|
|
22,121
|
|
|
22,612
|
|
||||
Total MBoe/d
|
80.4
|
|
|
81.0
|
|
|
81.0
|
|
|
82.8
|
|
||||
|
|
|
|
|
|
|
|
||||||||
Prices per unit
(1)
:
|
|
|
|
|
|
|
|
|
|
|
|
||||
Oil
|
|
|
|
|
|
|
|
|
|
|
|
||||
Average realized price on physical sales ($/Bbl)
(2)
|
$
|
66.61
|
|
|
$
|
45.49
|
|
|
$
|
64.61
|
|
|
$
|
46.38
|
|
Average realized price, including financial derivatives ($/Bbl)
(2)(3)
|
$
|
63.37
|
|
|
$
|
51.75
|
|
|
$
|
61.55
|
|
|
$
|
52.82
|
|
Natural gas
|
|
|
|
|
|
|
|
||||||||
Average realized price on physical sales ($/Mcf)
(2)
|
$
|
1.34
|
|
|
$
|
2.26
|
|
|
$
|
1.62
|
|
|
$
|
2.38
|
|
Average realized price, including financial derivatives ($/Mcf)
(2)(3)
|
$
|
1.69
|
|
|
$
|
2.49
|
|
|
$
|
1.89
|
|
|
$
|
2.48
|
|
NGLs
|
|
|
|
|
|
|
|
||||||||
Average realized price on physical sales ($/Bbl)
|
$
|
27.74
|
|
|
$
|
18.98
|
|
|
$
|
23.80
|
|
|
$
|
17.53
|
|
Average realized price, including financial derivatives ($/Bbl)
(3)
|
$
|
24.79
|
|
|
$
|
18.45
|
|
|
$
|
22.60
|
|
|
$
|
17.58
|
|
|
(1)
|
Oil prices for both of the quarter and
nine
months ended
September 30, 2018
reflect operating revenues for oil reduced by $3 million for oil purchases associated with managing our physical oil sales. For both of the quarter and
nine
months ended September 30,
2017
, there were no oil purchases associated with managing our physical oil sales. Natural gas prices for both of the quarter and
nine
months ended
September 30, 2018
reflect operating revenues for natural gas reduced by less than $1 million for natural gas purchases associated with managing our physical sales. Natural gas prices for the quarter and
nine
months ended
September 30, 2017
reflect operating revenues for natural gas reduced by less than $1 million and approximately $2 million, respectively, for natural gas purchases associated with managing our physical sales.
|
(2)
|
Changes in realized oil and natural gas prices reflect the effects of unhedged locational or basis differentials, unhedged volumes and contractual deductions between the commodity price index and the actual price at which we sold our oil and natural gas.
|
(3)
|
The quarters ended
September 30, 2018
and
2017
, include cash paid of approximately $14 million and cash received of approximately $26 million, respectively, for the settlement of crude oil derivative contracts and approximately $4 million and $2 million of cash received, respectively, for the settlement of natural gas financial derivatives. The
nine
months ended
September 30, 2018
and
2017
, include cash paid of approximately $39 million and cash received of approximately $83 million, respectively, for the settlement of crude oil derivative contracts and approximately $9 million and $3 million of cash received, respectively, for the settlement of natural gas financial derivatives. The quarters ended
September 30, 2018
and
2017
include approximately $4 million and $1 million of cash paid, respectively, for the settlement of NGLs derivative contracts. The
nine
months ended
September 30, 2018
and
2017
, include cash paid of approximately $5 million and cash received of less than $1 million, respectively, for the settlement of NGLs derivative contracts.
|
|
Quarter ended
|
||||||||||||||
|
Oil
|
|
Natural gas
|
|
NGLs
|
|
Total
|
||||||||
|
(in millions)
|
||||||||||||||
September 30, 2017 sales
|
$
|
189
|
|
|
$
|
27
|
|
|
$
|
26
|
|
|
$
|
242
|
|
Change due to prices
|
93
|
|
|
(11
|
)
|
|
12
|
|
|
94
|
|
||||
Change due to volumes
|
5
|
|
|
(1
|
)
|
|
(2
|
)
|
|
2
|
|
||||
September 30, 2018 sales
|
$
|
287
|
|
|
$
|
15
|
|
|
$
|
36
|
|
|
$
|
338
|
|
|
Nine months ended
|
||||||||||||||
|
Oil
|
|
Natural gas
|
|
NGLs
|
|
Total
|
||||||||
|
(in millions)
|
||||||||||||||
September 30, 2017 sales
|
$
|
595
|
|
|
$
|
84
|
|
|
$
|
71
|
|
|
$
|
750
|
|
Change due to prices
|
233
|
|
|
(27
|
)
|
|
24
|
|
|
230
|
|
||||
Change due to volumes
|
(8
|
)
|
|
(2
|
)
|
|
(3
|
)
|
|
(13
|
)
|
||||
September 30, 2018 sales
|
$
|
820
|
|
|
$
|
55
|
|
|
$
|
92
|
|
|
$
|
967
|
|
|
Quarter ended September 30,
|
||||||||||||||
|
2018
|
|
2017
|
||||||||||||
|
Oil
(Bbl)
|
|
Natural gas
(MMBtu)
|
|
Oil
(Bbl)
|
|
Natural gas
(MMBtu)
|
||||||||
Differentials and deducts
|
$
|
(2.67
|
)
|
|
$
|
(1.39
|
)
|
|
$
|
(2.87
|
)
|
|
$
|
(0.76
|
)
|
NYMEX
|
$
|
69.50
|
|
|
$
|
2.91
|
|
|
$
|
48.21
|
|
|
$
|
3.00
|
|
Net back realization %
|
96.2
|
%
|
|
52.2
|
%
|
|
94.0
|
%
|
|
74.7
|
%
|
|
Nine months ended September 30,
|
||||||||||||||
|
2018
|
|
2017
|
||||||||||||
|
Oil
(Bbl)
|
|
Natural gas
(MMBtu)
|
|
Oil
(Bbl)
|
|
Natural gas
(MMBtu)
|
||||||||
Differentials and deducts
|
$
|
(1.99
|
)
|
|
$
|
(1.17
|
)
|
|
$
|
(3.30
|
)
|
|
$
|
(0.79
|
)
|
NYMEX
|
$
|
66.75
|
|
|
$
|
2.90
|
|
|
$
|
49.47
|
|
|
$
|
3.17
|
|
Net back realization %
|
97.0
|
%
|
|
59.7
|
%
|
|
93.3
|
%
|
|
75.1
|
%
|
|
Quarter ended September 30,
|
||||||||||||||
|
2018
|
|
2017
|
||||||||||||
|
Total
|
|
Per Unit
(1)
|
|
Total
|
|
Per Unit
(1)
|
||||||||
|
(in millions, except per unit costs)
|
||||||||||||||
Operating expenses
|
|
|
|
|
|
|
|
||||||||
Oil and natural gas purchases
|
$
|
3
|
|
|
$
|
0.36
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Transportation costs
|
25
|
|
|
3.41
|
|
|
29
|
|
|
3.91
|
|
||||
Lease operating expense
(2)
|
46
|
|
|
6.16
|
|
|
42
|
|
|
5.66
|
|
||||
General and administrative
(3)
|
21
|
|
|
2.91
|
|
|
25
|
|
|
3.28
|
|
||||
Depreciation, depletion and amortization
|
127
|
|
|
17.11
|
|
|
118
|
|
|
15.92
|
|
||||
Gain on sale of assets
|
(1
|
)
|
|
(0.13
|
)
|
|
—
|
|
|
—
|
|
||||
Impairment charges
|
—
|
|
|
—
|
|
|
1
|
|
|
0.09
|
|
||||
Exploration and other expense
|
2
|
|
|
0.29
|
|
|
6
|
|
|
0.83
|
|
||||
Taxes, other than income taxes
|
22
|
|
|
3.02
|
|
|
16
|
|
|
2.10
|
|
||||
Total operating expenses
|
$
|
245
|
|
|
$
|
33.13
|
|
|
$
|
237
|
|
|
$
|
31.79
|
|
|
|
|
|
|
|
|
|
||||||||
Total equivalent volumes (MBoe)
|
7,401
|
|
|
|
|
|
7,456
|
|
|
|
|
|
Nine months ended September 30,
|
||||||||||||||
|
2018
|
|
2017
|
||||||||||||
|
Total
|
|
Per Unit
(1)
|
|
Total
|
|
Per Unit
(1)
|
||||||||
|
(in millions, except per unit costs)
|
||||||||||||||
Operating expenses
|
|
|
|
|
|
|
|
||||||||
Oil and natural gas purchases
|
$
|
3
|
|
|
$
|
0.13
|
|
|
$
|
2
|
|
|
$
|
0.08
|
|
Transportation costs
|
76
|
|
|
3.44
|
|
|
86
|
|
|
3.80
|
|
||||
Lease operating expense
(2)
|
123
|
|
|
5.53
|
|
|
121
|
|
|
5.36
|
|
||||
General and administrative
(3)
|
68
|
|
|
3.09
|
|
|
71
|
|
|
3.13
|
|
||||
Depreciation, depletion and amortization
|
376
|
|
|
17.00
|
|
|
368
|
|
|
16.29
|
|
||||
Gain on sale of assets
|
(1
|
)
|
|
(0.07
|
)
|
|
—
|
|
|
—
|
|
||||
Impairment charges
|
—
|
|
|
—
|
|
|
2
|
|
|
0.06
|
|
||||
Exploration and other expense
|
3
|
|
|
0.14
|
|
|
10
|
|
|
0.47
|
|
||||
Taxes, other than income taxes
|
63
|
|
|
2.86
|
|
|
50
|
|
|
2.22
|
|
||||
Total operating expenses
|
$
|
711
|
|
|
$
|
32.12
|
|
|
$
|
710
|
|
|
$
|
31.41
|
|
|
|
|
|
|
|
|
|
||||||||
Total equivalent volumes (MBoe)
|
22,121
|
|
|
|
|
22,612
|
|
|
|
|
|
(1)
|
Per unit costs are based on actual amounts rather than the rounded totals presented.
|
(2)
|
Includes approximately $2 million for both of the quarter and nine months ended September 30, 2018 or $0.28 per Boe and $0.09 per Boe, respectively, of adjustments under a joint venture agreement.
|
(3)
|
For the
quarter and nine
months ended
September 30, 2018
, amount includes approximately
$5 million
or
$0.70
per Boe and
$9 million
or
$0.44
per Boe, respectively, of non-cash compensation expense. The
quarter and nine
months ended
September 30, 2018
also include approximately
$1 million
or
$0.16
per Boe and
$7 million
or
$0.32
per Boe, respectively, of transition and severance costs related to workforce reductions. For the
quarter and nine
months ended
September 30, 2017
, amount includes approximately
$5 million
or
$0.65
per Boe and
$7 million
or
$0.30
per Boe, respectively, of non-cash compensation expense.
|
|
Quarter ended
September 30, |
|
Nine months ended
September 30, |
||||||||||||
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||||||
Depreciation, depletion and amortization ($/Boe)
|
$
|
17.11
|
|
|
$
|
15.92
|
|
|
$
|
17.00
|
|
|
$
|
16.29
|
|
|
Quarter ended
September 30, |
|
Nine months ended
September 30, |
||||||||||||
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||||||
|
(in millions)
|
||||||||||||||
Net loss
|
$
|
(44
|
)
|
|
$
|
(72
|
)
|
|
$
|
(84
|
)
|
|
$
|
(122
|
)
|
Income tax benefit
|
—
|
|
|
(2
|
)
|
|
—
|
|
|
(7
|
)
|
||||
Interest expense, net of capitalized interest
|
95
|
|
|
80
|
|
|
268
|
|
|
245
|
|
||||
Depreciation, depletion and amortization
|
127
|
|
|
118
|
|
|
376
|
|
|
368
|
|
||||
Exploration expense
|
1
|
|
|
3
|
|
|
3
|
|
|
7
|
|
||||
EBITDAX
|
179
|
|
|
127
|
|
|
563
|
|
|
491
|
|
||||
Mark-to-market on financial derivatives
(1)
|
44
|
|
|
23
|
|
|
122
|
|
|
(92
|
)
|
||||
Cash settlements and cash premiums on financial derivatives
(2)
|
(14
|
)
|
|
27
|
|
|
(34
|
)
|
|
86
|
|
||||
Non-cash portion of compensation expense
(3)
|
5
|
|
|
5
|
|
|
9
|
|
|
7
|
|
||||
Transition, severance and other costs
(4)
|
1
|
|
|
—
|
|
|
7
|
|
|
—
|
|
||||
Gain on sale of assets
|
(1
|
)
|
|
—
|
|
|
(1
|
)
|
|
—
|
|
||||
(Gain) loss on extinguishment/modification of debt
|
—
|
|
|
(24
|
)
|
|
(48
|
)
|
|
16
|
|
||||
Impairment charges
|
—
|
|
|
1
|
|
|
—
|
|
|
2
|
|
||||
Adjusted EBITDAX
|
$
|
214
|
|
|
$
|
159
|
|
|
$
|
618
|
|
|
$
|
510
|
|
|
(1)
|
Represents the income statement impact of financial derivatives.
|
(2)
|
Represents actual cash settlements related to financial derivatives. No cash premiums were received or paid for the quarters and
nine
months ended
September 30, 2018
and 2017.
|
(3)
|
There were no cash payments for the quarters ended
September 30, 2018
and 2017 and none for the
nine
months ended
September 30, 2018
. For the
nine
months ended
September 30, 2017
, cash payments were approximately $4 million.
|
(4)
|
Reflects transition and severance costs related to workforce reductions.
|
|
Capital
Expenditures
(1)
(in millions)
|
|
Average Drilling
Rigs
|
|||
Eagle Ford Shale
|
$
|
349
|
|
|
2.8
|
|
Permian
|
98
|
|
|
0.4
|
|
|
Northeastern Utah
|
98
|
|
|
2.0
|
|
|
Total
|
$
|
545
|
|
|
5.2
|
|
Acquisition and other capital
(2)
|
$
|
332
|
|
|
|
|
Total Capital Expenditures
|
$
|
877
|
|
|
|
|
(1)
|
Represents accrual-based capital expenditures.
|
(2)
|
Reflects cash paid for acquisitions (including a deposit made in December 2017) and capital adjustments under a joint venture agreement.
|
|
Nine months ended
September 30, |
||||||
|
2018
|
|
2017
|
||||
Cash Inflows
|
|
|
|
|
|
||
Operating activities
|
|
|
|
|
|
||
Net loss
|
$
|
(84
|
)
|
|
$
|
(122
|
)
|
Gain on sale of assets
|
(1
|
)
|
|
—
|
|
||
(Gain) loss on extinguishment/modification of debt
|
(48
|
)
|
|
16
|
|
||
Other income adjustments
|
398
|
|
|
394
|
|
||
Changes in assets and liabilities
|
115
|
|
|
10
|
|
||
Total cash flow from operations
|
380
|
|
|
298
|
|
||
|
|
|
|
||||
Investing activities
|
|
|
|
|
|
||
Proceeds from the sale of assets
|
175
|
|
|
—
|
|
||
Cash inflows from investing activities
|
175
|
|
|
—
|
|
||
|
|
|
|
|
|
||
Financing activities
|
|
|
|
|
|
||
Proceeds from issuance of long-term debt
|
1,805
|
|
|
1,645
|
|
||
Cash inflows from financing activities
|
1,805
|
|
|
1,645
|
|
||
|
|
|
|
||||
Total cash inflows
|
$
|
2,360
|
|
|
$
|
1,943
|
|
|
|
|
|
||||
Cash Outflows
|
|
|
|
|
|
||
Investing activities
|
|
|
|
|
|
||
Capital expenditures
|
$
|
559
|
|
|
$
|
405
|
|
Cash paid for acquisitions
|
275
|
|
|
29
|
|
||
Cash outflows from investing activities
|
834
|
|
|
434
|
|
||
|
|
|
|
|
|
||
Financing activities
|
|
|
|
|
|
||
Repayments and repurchases of long-term debt
|
1,431
|
|
|
1,484
|
|
||
Fees/costs on debt exchange
|
62
|
|
|
—
|
|
||
Debt issue costs
|
21
|
|
|
21
|
|
||
Other
|
1
|
|
|
3
|
|
||
Cash outflows from financing activities
|
1,515
|
|
|
1,508
|
|
||
|
|
|
|
||||
Total cash outflows
|
$
|
2,349
|
|
|
$
|
1,942
|
|
|
|
|
|
||||
Net change in cash, cash equivalents and restricted cash
|
$
|
11
|
|
|
$
|
1
|
|
|
2018
|
|
2019
|
|
2020
|
|
2021 - 2022
|
|
Thereafter
|
|
Total
|
||||||||||||
|
(in millions)
|
||||||||||||||||||||||
Financing obligations:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
Principal
|
$
|
—
|
|
|
$
|
8
|
|
|
$
|
246
|
|
|
$
|
195
|
|
|
$
|
3,954
|
|
|
$
|
4,403
|
|
Interest
|
91
|
|
|
364
|
|
|
348
|
|
|
671
|
|
|
653
|
|
|
2,127
|
|
||||||
Liabilities from derivatives
|
32
|
|
|
50
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
82
|
|
||||||
Operating leases
|
3
|
|
|
4
|
|
|
4
|
|
|
8
|
|
|
13
|
|
|
32
|
|
||||||
Other contractual commitments and purchase obligations:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
Volume and transportation commitments
|
16
|
|
|
62
|
|
|
57
|
|
|
92
|
|
|
7
|
|
|
234
|
|
||||||
Other obligations
|
31
|
|
|
22
|
|
|
8
|
|
|
13
|
|
|
3
|
|
|
77
|
|
||||||
Total contractual obligations
|
$
|
173
|
|
|
$
|
510
|
|
|
$
|
663
|
|
|
$
|
979
|
|
|
$
|
4,630
|
|
|
$
|
6,955
|
|
•
|
Volume and Transportation Commitments.
Included in these amounts are commitments for demand charges for firm access to natural gas transportation, volume deficiency contracts and firm oil capacity contracts.
|
•
|
Other Obligations.
Included in these amounts are commitments for drilling, completion and seismic
|
|
|
|
Oil, Natural Gas and NGLs Derivatives
|
||||||||||||||||
|
|
|
10 Percent Increase
|
|
10 Percent Decrease
|
||||||||||||||
|
Fair Value
|
|
Fair Value
|
|
Change
|
|
Fair Value
|
|
Change
|
||||||||||
|
(in millions)
|
||||||||||||||||||
Price impact
(1)
|
$
|
(82
|
)
|
|
$
|
(157
|
)
|
|
$
|
(75
|
)
|
|
$
|
(9
|
)
|
|
$
|
73
|
|
|
|
|
Oil, Natural Gas and NGLs Derivatives
|
||||||||||||||||
|
|
|
1 Percent Increase
|
|
1 Percent Decrease
|
||||||||||||||
|
Fair Value
|
|
Fair Value
|
|
Change
|
|
Fair
Value
|
|
Change
|
||||||||||
|
(in millions)
|
||||||||||||||||||
Discount rate
(2)
|
$
|
(82
|
)
|
|
$
|
(82
|
)
|
|
$
|
—
|
|
|
$
|
(83
|
)
|
|
$
|
(1
|
)
|
Credit rate
(3)
|
$
|
(82
|
)
|
|
$
|
(82
|
)
|
|
$
|
—
|
|
|
$
|
(83
|
)
|
|
$
|
(1
|
)
|
|
(1)
|
Presents the hypothetical sensitivity of our commodity-based derivatives to changes in fair values arising from changes in oil, natural gas and NGLs prices.
|
(2)
|
Presents the hypothetical sensitivity of our commodity-based derivatives to changes in the discount rates we used to determine the fair value of our derivatives.
|
(3)
|
Presents the hypothetical sensitivity of our commodity-based derivatives to changes in credit risk of our counterparties.
|
•
|
should not in all instances be treated as categorical statements of fact, but rather as a way of allocating the risk to one of the parties if those statements prove to be inaccurate;
|
•
|
may have been qualified by disclosures that were made to the other party in connection with the negotiation of the applicable agreement, which disclosures are not necessarily reflected in the agreement;
|
•
|
may apply standards of materiality in a way that is different from what may be viewed as material to certain investors; and
|
•
|
were made only as of the date of the applicable agreement or such other date or dates as may be specified in the agreement and are subject to more recent developments.
|
Exhibit
Number
|
|
Description
|
|
|
|
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
*101.INS
|
|
XBRL Instance Document.
|
|
|
|
*101.SCH
|
|
XBRL Schema Document.
|
|
|
|
*101.CAL
|
|
XBRL Calculation Linkbase Document.
|
|
|
|
*101.DEF
|
|
XBRL Definition Linkbase Document.
|
|
|
|
*101.LAB
|
|
XBRL Labels Linkbase Document.
|
|
|
|
*101.PRE
|
|
XBRL Presentation Linkbase Document.
|
|
EP ENERGY CORPORATION
|
|
|
|
|
Date: November 8, 2018
|
/s/ Kyle A. McCuen
|
|
Kyle A. McCuen
|
|
Senior Vice President, Chief Financial Officer and Treasurer
|
|
(Principal Financial and Accounting Officer)
|
(a)
|
Consents
. The Second Tranche Disclosure of Schedule 11.1(d) to the ARPDA is hereby deleted in its entirety and replaced with
Schedule 11.1(d) – Second Tranche
attached to this Amendment.
|
(b)
|
Litigation
. The Second Tranche Disclosure of Schedule 11.1(g) to the ARPDA is hereby deleted in its entirety and replaced with
Schedule 11.1(g) – Second Tranche
attached to this Amendment.
|
(c)
|
Material Contracts
. The Second Tranche Disclosure of Schedule 11.1(h) to the ARPDA is hereby deleted in its entirety and replaced with
Schedule 11.1(h) – Second Tranche
attached to this Amendment. The Parties acknowledge and agree that Partner has been provided with true and correct copies, in all respects, of all Material Contracts listed on
Schedule 11.1(h) – Second Tranche
attached to this Amendment.
|
(d)
|
Preferential Purchase Rights
. The Second Tranche Disclosure of Schedule 11.1(j) to the ARPDA is hereby deleted in its entirety and replaced with
Schedule 11.1(j) – Second Tranche
attached to this Amendment.
|
(e)
|
Payout Status
. The Second Tranche Disclosure of Schedule 11.1(t) is hereby deleted in its entirety and replaced with
Schedule 11.1(t) – Second Tranche
attached to this Amendment.
|
(f)
|
Other Schedules
. The Second Tranche Disclosures of Schedule 11.1(h)(ii) and Schedule 11.1(i), to the ARPDA are hereby amended to add the phrase “– Second Tranche” to the headers of each such Second Tranche Disclosures.
|
(a)
|
The Parties agree that, effective as of the Amendment Date, Section 1 (Description of Wells and Formation Depths subject to this Agreement) of Exhibit A to the Second Tranche JOA is hereby deleted in its entirety and replaced with
Schedule I
attached hereto. The Parties further agree that, effective as of the Amendment Date, Section 1 (Description of Wells and Formation Depths subject to this Agreement) of Exhibit “A” to Exhibit H to the Second Tranche JOA is hereby deleted in its entirety and replaced with
Schedule I
attached hereto.
|
(b)
|
The Parties further agree that, effective as of the Amendment Date, Annex A to Exhibit A to the Second Tranche JOA and Annex A to Exhibit “A” to Exhibit H to the Second Tranche JOA are hereby deleted in their entirety and replaced with
Annex A
attached hereto.
|
WOLFCAMP DRILLCO OPERATING, L.P.
|
||
By: Wolfcamp DrillCo Operating GP LLC, its General Partner
|
||
By: Wolfcamp DrillCo LLC, its sole member
|
||
|
|
|
By:
|
|
/s/ Michael Becci
|
Name:
|
|
Michael Becci
|
Title:
|
|
Authorized Person
|
|
|
|
|
|
|
EP ENERGY E&P COMPANY, L.P.
|
||
|
|
|
By:
|
|
/s/ Kyle McCuen
|
Name:
|
|
Kyle McCuen
|
Title:
|
|
Chief Financial Officer
|
|
/s/ Russell E. Parker
|
|
Russell E. Parker
|
|
President and Chief Executive Officer
|
|
EP Energy Corporation
|
|
/s/ Kyle A. McCuen
|
|
Kyle A. McCuen
|
|
Senior Vice President, Chief Financial Officer and Treasurer
|
|
EP Energy Corporation
|
|
/s/ Russell E. Parker
|
|
Russell E. Parker
|
|
President and Chief Executive Officer
|
|
EP Energy Corporation
|
|
|
|
Date: November 8, 2018
|
|
/s/ Kyle A. McCuen
|
|
Kyle A. McCuen
|
|
Senior Vice President, Chief Financial
|
|
Officer and Treasurer
|
|
EP Energy Corporation
|
|
|
|
Date: November 8, 2018
|