10-Q

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TABLE OF CONTENTS

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM 10-Q

ý	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended June 30, 2013
OR
o	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from                  to

Commission File Number: 001-35467

Halcón Resources Corporation
(Exact name of registrant as specified in its charter)

Delaware
(State or other jurisdiction of
incorporation or organization) 1311
(Primary Standard Industrial
Classification Code Number) 20-0700684
(I.R.S. Employer
Identification Number)

1000 Louisiana Street, Suite 6700, Houston, TX 77002
(Address of principal executive offices)

(832) 538-0300
(Registrant's telephone number, including area code)

(Former name, former address and former fiscal year, if changed since last report)

        Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding twelve months (or for such shorter period that the registrant was required to file such reports) and (2) has been subject to such filing requirements for the past 90 days. Yes ý    No o

        Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes ý    No o

        Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of "large accelerated filer," "accelerated filer" and "smaller reporting company" in Rule 12b-2 of the Exchange Act.

Large Accelerated Filer o Accelerated Filer ý Non-Accelerated Filer o
(Do not check if a
smaller reporting company) Smaller Reporting Company o

        Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes o    No ý

        At July 25, 2013, 370,089,663 shares of the Registrant's Common Stock were outstanding.

TABLE OF CONTENTS

		Page
PART I—FINANCIAL INFORMATION
ITEM 1.	Condensed Consolidated Financial Statements (Unaudited)
	Condensed Consolidated Statements of Operations (Unaudited) for the Three and Six Months Ended June 30, 2013 and 2012		5
	Condensed Consolidated Balance Sheets (Unaudited) as of June 30, 2013 and December 31, 2012		6
	Condensed Consolidated Statements of Stockholders' Equity (Unaudited) for the Six Months Ended June 30, 2013 and Year Ended December 31, 2012		7
	Condensed Consolidated Statements of Cash Flows (Unaudited) for the Six Months Ended June 30, 2013 and 2012		8
	Notes to Unaudited Condensed Consolidated Financial Statements		9
ITEM 2.	Management's Discussion and Analysis of Financial Condition and Results of Operations		39
ITEM 3.	Quantitative and Qualitative Disclosures About Market Risk		51
ITEM 4.	Controls and Procedures		52
PART II—OTHER INFORMATION
ITEM 1.	Legal Proceedings		52
ITEM 1A.	Risk Factors		52
ITEM 2.	Unregistered Sales of Equity Securities and Use of Proceeds		54
ITEM 3.	Defaults Upon Senior Securities		54
ITEM 4.	Mine Safety Disclosures		54
ITEM 5.	Other Information		54
ITEM 6.	Exhibits		55
Signatures			59

2

Special note regarding forward-looking statements

        This Quarterly Report on Form 10-Q contains forward-looking statements within the meaning of the federal securities laws. All statements, other than statements of historical facts, concerning, among other things, planned capital expenditures, potential increases in oil and natural gas production, the number and location of wells to be drilled in the future, future cash flows and borrowings, pursuit of potential acquisition opportunities, our financial position, business strategy and other plans and objectives for future operations, are forward-looking statements. These forward-looking statements are identified by their use of terms and phrases such as "may," "expect," "estimate," "project," "plan," "objective," "believe," "predict," "intend," "achievable," "anticipate," "will," "continue," "potential," "should," "could" and similar terms and phrases. Although we believe that the expectations reflected in these forward-looking statements are reasonable, they do involve certain assumptions, risks and uncertainties. Actual results could differ materially from those anticipated in these forward-looking statements. You should consider carefully the risks discussed under the "Risk Factors" section of our previously filed Annual Report on Form 10-K for the year ended December 31, 2012, and the other disclosures contained herein and therein, which describe factors that could cause our actual results to differ from those anticipated in the forward-looking statements, including, but not limited to, the following factors:

•

our ability to successfully integrate acquired oil and natural gas businesses and operations;

•

the possibility that acquisitions may involve unexpected costs or delays, will not achieve intended benefits and will divert management's time and energy, which could have an adverse effect on our financial position, results of operations, or cash flows;

•

we have substantial indebtedness and may incur more debt, subject to any borrowing limitations; higher levels of indebtedness make us more vulnerable to economic downturns and adverse developments in our business;

•

our ability to successfully develop our large inventory of undeveloped acreage in our resource plays;

•

access to and availability of water and other treatment materials to carry out planned fracture stimulations in our resource plays;

•

access to adequate gathering systems and transportation take-away capacity to move our production to market and marketing outlets to sell our production at market prices which is necessary to fully execute our capital program;

•

our ability to generate sufficient cash flow from operations, borrowings or other sources to enable us to fully develop our undeveloped acreage positions;

•

volatility in commodity prices for oil and natural gas;

•

our ability to replace oil and natural gas reserves;

•

the presence or recoverability of estimated oil and natural gas reserves and actual future production rates and associated costs;

•

the potential for production decline rates for our wells to be greater than we expect;

•

our ability to retain key members of senior management and key technical employees;

•

competition, including competition for acreage in resource play holdings;

•

environmental risks;

•

drilling and operating risks;

3

•

exploration and development risks;

•

the possibility that the industry may be subject to future regulatory or legislative actions (including any additional taxes and changes in environmental regulation);

•

general economic conditions, whether internationally, nationally or in the regional and local market areas in which we do business, may be less favorable than expected, including the possibility that economic conditions in the United States will worsen and that capital markets are disrupted, which could adversely affect demand for oil and natural gas and make it difficult to access financial markets;

•

the cost and availability of goods and services, such as drilling rigs, fracture stimulation services and tubulars;

•

social unrest, political instability or armed conflict in major oil and natural gas producing regions outside the United States, such as the Middle East, and acts of terrorism or sabotage;

•

other economic, competitive, governmental, regulatory, legislative, including federal, state and tribal regulations and laws, geopolitical and technological factors that may negatively impact our business, operations or pricing;

•

the insurance coverage maintained by us may not adequately cover all losses that may be sustained in connection with all oil and natural gas activities;

•

title to the properties in which we have an interest may be impaired by title defects;

•

senior management's ability to execute our plans to meet our goals; and

•

our dependency on the skill, ability and decisions of third party operators of the oil and natural gas properties in which we have a non-operated working interest.

        All forward-looking statements are expressly qualified in their entirety by the cautionary statements in this paragraph and elsewhere in this document. Other than as required under the securities laws, we do not assume a duty to update these forward-looking statements, whether as a result of new information, subsequent events or circumstances, changes in expectations or otherwise.

4

PART I. FINANCIAL INFORMATION

Item 1.    Condensed Consolidated Financial Statements (Unaudited)

HALCÓN RESOURCES CORPORATION

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited)

(In thousands, except per share amounts)

	Three Months Ended June 30,						Six Months Ended June 30,
	2013			2012			2013			2012
Operating revenues:
Oil, natural gas and natural gas liquids sales:
Oil	$	202,490		$	20,383		$	383,317		$	43,380
Natural gas		6,845			1,270			12,514			2,957
Natural gas liquids		4,254			1,653			8,082			3,850
Total oil, natural gas and natural gas liquids sales		213,589			23,306			403,913			50,187
Other		754			35			1,284			71
Total operating revenues		214,343			23,341			405,197			50,258
Operating expenses:
Production:
Lease operating		31,833			8,303			57,137			15,916
Workover and other		623			540			2,247			1,261
Taxes other than income		18,567			1,908			36,003			3,834
Gathering and other		2,802			60			3,135			107
Restructuring		(164	)		903			507			1,007
General and administrative		33,526			12,891			65,123			33,203
Depletion, depreciation and accretion		95,315			5,956			177,173			11,935
Total operating expenses		182,502			30,561			341,325			67,263
Income (loss) from operations		31,841			(7,220	)		63,872			(17,005	)
Other income (expenses):
Interest expense and other, net		(5,732	)		(4,179	)		(10,582	)		(17,176	)
Net gain (loss) on derivative contracts		34,100			13,671			15,678			8,726
Total other income (expenses)		28,368			9,492			5,096			(8,450	)
Income (loss) before income taxes		60,209			2,272			68,968			(25,455	)
Income tax benefit (provision)		(23,121	)		5,387			(26,415	)		(208	)
Net income (loss)		37,088			7,659			42,553			(25,663	)
Non-cash preferred dividend		—			(87,343	)		—			(88,445	)
Series A preferred dividends		(716	)		—			(716	)		—
Net income (loss) available to common stockholders	$	36,372		$	(79,684	)	$	41,837		$	(114,108	)
Net income (loss) per share of common stock:
Basic	$	0.10		$	(0.59	)	$	0.12		$	(1.11	)
Diluted	$	0.08		$	(0.59	)	$	0.11		$	(1.11	)
Weighted average common shares outstanding:
Basic		366,712			136,066			356,482			102,441
Diluted		441,145			136,066			412,412			102,441

The accompanying notes are an integral part of these unaudited condensed consolidated
financial statements.

5

HALCÓN RESOURCES CORPORATION

CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited)

(In thousands, except share and per share amounts)

	June 30, 2013			December 31, 2012
Current assets:
Cash	$	3,061		$	2,506
Accounts receivable		264,216			262,809
Receivables from derivative contracts		9,336			7,428
Current portion of deferred income taxes		—			5,307
Inventory		6,581			3,116
Prepaids and other		12,968			6,691
Total current assets		296,162			287,857
Oil and natural gas properties (full cost method):
Evaluated		3,843,579			2,669,245
Unevaluated		2,307,887			2,326,598
Gross oil and natural gas properties		6,151,466			4,995,843
Less—accumulated depletion		(761,013	)		(588,207	)
Net oil and natural gas properties		5,390,453			4,407,636
Other operating property and equipment:
Gas gathering and other operating assets		142,436			59,748
Less—accumulated depreciation		(10,537	)		(8,119	)
Net other operating property and equipment		131,899			51,629
Other noncurrent assets:
Goodwill		228,800			227,762
Receivables from derivative contracts		11,299			371
Debt issuance costs, net of amortization		59,294			51,609
Equity in oil and natural gas partnerships		11,059			11,137
Funds in escrow		847			2,090
Other		37,132			934
Total assets	$	6,166,945		$	5,041,025
Current liabilities:
Accounts payable and accrued liabilities	$	705,817		$	590,551
Liabilities from derivative contracts		5,198			10,429
Current portion of deferred income taxes		764			—
Asset retirement obligations		2,923			2,319
Promissory notes		—			74,669
Total current liabilities		714,702			677,968
Long-term debt		2,713,947			2,034,498
Other noncurrent liabilities:
Liabilities from derivative contracts		—			2,461
Asset retirement obligations		79,428			72,813
Deferred income taxes		173,258			160,055
Other		3,785			10
Commitments and contingencies (Note 10)
Mezzanine equity:
Preferred stock: 1,000,000 shares of $0.0001 par value authorized; none and 10,880 shares of 8% Automatically Convertible, issued and outstanding as of June 30, 2013 and December 31, 2012, respectively		—			695,238
Stockholders' equity:
Preferred stock: 1,000,000 shares of $0.0001 par value authorized; 345,000 and none shares of 5.75% Cumulative Perpetual Convertible, Series A, issued and outstanding as of June 30, 2013 and December 31, 2012, respectively		—			—
Common stock: 670,000,000 and 336,666,666 shares of $0.0001 par value authorized; 370,077,763 and 259,802,377 shares issued; 370,077,763 and 258,152,468 outstanding at June 30, 2013 and December 31, 2012, respectively		37			26
Additional paid-in capital		2,713,698			1,681,717
Treasury stock: none and 1,649,909 shares at June 30, 2013 and December 31, 2012, respectively, at cost		—			(9,298	)
Accumulated deficit		(231,910	)		(274,463	)
Total stockholders' equity		2,481,825			1,397,982
Total liabilities and stockholders' equity	$	6,166,945		$	5,041,025

The accompanying notes are an integral part of these unaudited condensed consolidated
financial statements.

6

HALCÓN RESOURCES CORPORATION

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY (Unaudited)

(In thousands)

	Preferred Stock						Common Stock								Treasury Stock
												Additional Paid-In Capital									Accumulated Deficit			Stockholders' Equity
	Shares			Amount			Shares			Amount					Shares			Amount
Balances at December 31, 2011		—		$	—			27,695		$	3	$	229,414			1,450		$	(7,159	)	$	(220,578	)	$	1,680
Warrants issued		—			—			—			—		43,590			—			—			—			43,590
Sale of common stock		—			—			115,232			11		568,989			—			—			—			569,000
Reverse-stock-split rounding		—			—			4			—		—			—			—			—			—
Sale of preferred stock		4			311,556			—			—		—			—			—			—			311,556
Preferred stock conversion		(4	)		(385,476	)		44,445			5		385,471			—			—			—			—
Offering costs		—			(14,525	)		—			—		(5,078	)		—			—			—			(19,603	)
Common stock issuance		—			—			72,114			7		452,032			—			—			—			452,039
Net loss		—			—			—			—		—			—			—			(53,885	)		(53,885	)
Preferred beneficial conversion feature		—			—			—			—		88,445			—			—			—			88,445
Non-cash preferred dividend		—			88,445			—			—		(88,445	)		—			—			—			—
Long-term incentive plan grants		—			—			312			—		—			—			—			—			—
Repurchase of stock		—			—			—			—		—			200			(2,139	)		—			(2,139	)
Share-based compensation		—			—			—			—		7,299			—			—			—			7,299
Balances at December 31, 2012		—		$	—			259,802		$	26	$	1,681,717			1,650		$	(9,298	)	$	(274,463	)	$	1,397,982
Net income		—			—			—			—		—			—			—			42,553			42,553
Preferred stock conversion		—			—			108,801			11		695,227			—			—			—			695,238
Sale of Series A preferred stock		345			—			—			—		345,000			—			—			—			345,000
Offering costs		—			—			—			—		(9,658	)		—			—			—			(9,658	)
Long-term incentive plan grants		—			—			3,218			—		—			—			—			—			—
Long-term incentive plan forfeitures		—			—			(94	)		—		—			—			—			—			—
Retirement of shares in treasury		—			—			(442	)		—		(2,492	)		(442	)		2,492			—			—
Long-term incentive plan grants issued out of treasury		—			—			(1,208	)		—		(6,806	)		(1,208	)		6,806			—			—
Share-based compensation		—			—			—			—		10,710			—			—			—			10,710
Balances at June 30, 2013		345		$	—			370,077		$	37	$	2,713,698			—		$	—		$	(231,910	)	$	2,481,825

The accompanying notes are an integral part of these unaudited condensed consolidated
financial statements.

7

HALCÓN RESOURCES CORPORATION

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited)

(In thousands)

	Six Months Ended June 30,
	2013			2012
Cash flows from operating activities:
Net income (loss)	$	42,553		$	(25,663	)
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities:
Depletion, depreciation and accretion		177,173			11,935
Deferred income tax provision (benefit)		21,305			136
Share-based compensation, net		6,975			2,465
Unrealized loss (gain) on derivative contracts		(19,139	)		(8,036	)
Amortization and write-off of deferred loan costs		508			6,299
Non-cash interest and amortization of discount and premium		1,054			7,733
Other income		(2,912	)		(17	)
Change in assets and liabilities, net of acquisitions:
Accounts receivable		(52,686	)		948
Inventory		(768	)		(167	)
Prepaids and other		(5,438	)		(1,841	)
Accounts payable and accrued liabilities		61,265			3,500
Net cash provided by (used in) operating activities		229,890			(2,708	)
Cash flows from investing activities:
Oil and natural gas capital expenditures		(1,024,488	)		(468,197	)
Other operating property and equipment capital expenditures		(80,718	)		(3,573	)
Acquisition of Williston Basin Assets		(29,739	)		—
Funds held in escrow and other		(30,805	)		(29,039	)
Net cash used in investing activities		(1,165,750	)		(500,809	)
Cash flows from financing activities:
Proceeds from borrowings		1,528,000			237,410
Repayments of borrowings		(915,400	)		(208,000	)
Debt issuance costs		(11,527	)		(5,053	)
Offering costs		(9,658	)		(18,133	)
Common stock repurchased		—			(2,139	)
Series A preferred stock issued		345,000			—
Preferred stock issued		—			311,556
Preferred beneficial conversion feature		—			88,445
Common stock issued		—			275,000
Warrants issued		—			43,590
Net cash provided by financing activities		936,415			722,676
Net increase (decrease) in cash		555			219,159
Cash at beginning of period		2,506			49
Cash at end of period	$	3,061		$	219,208

The accompanying notes are an integral part of these unaudited condensed consolidated
financial statements.

8

HALCÓN RESOURCES CORPORATION

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

1. FINANCIAL STATEMENT PRESENTATION

Basis of Presentation and Principles of Consolidation

        Halcón Resources Corporation (Halcón or the Company) is an independent energy company focused on the acquisition, production, exploration and development of onshore liquids-rich assets in the United States. The unaudited condensed consolidated financial statements include the accounts of all majority owned, controlled subsidiaries. The Company operates in one segment which focuses on oil and natural gas acquisition, production, exploration and development. The Company's oil and natural gas properties are managed as a whole rather than through discrete operating areas. Operational information is tracked by operating area; however, financial performance is assessed as a whole. Allocation of capital is made across the Company's entire portfolio without regard to operating area. All intercompany accounts and transactions have been eliminated. These unaudited condensed consolidated financial statements reflect, in the opinion of the Company's management, all adjustments, consisting of normal and recurring adjustments, necessary to present fairly the financial position as of, and the results of operations for, the periods presented. During interim periods, Halcón follows the accounting policies disclosed in its 2012 Annual Report on Form 10-K, as filed with the United States Securities and Exchange Commission (SEC). Please refer to the footnotes in the 2012 Annual Report on Form 10-K when reviewing interim financial results.

        As discussed in Item 8. Consolidated Financial Statements and Supplementary Data—Note 2, "Corrections of Immaterial Errors," to the Company's Annual Report on Form 10-K for the year ended December 31, 2012, the consolidated balance sheet as of December 31, 2011 was restated to reflect the correction of $4.3 million of tax basis adjustments to "Oil and natural gas properties" and "Deferred income taxes" for periods prior to January 1, 2007, and as such, the accumulated deficit and stockholders' equity balances of $242.0 million and $680.9 million, respectively, reported on the Company's Quarterly Report on Form 10-Q for the six months ended June 30, 2012 have been adjusted to $246.3 million and $676.6 million, respectively.

Consolidated Financial Statements

        The unaudited condensed consolidated financial statements include the accounts of Halcón and its majority-owned subsidiaries. The equity method is used to account for investments in affiliates in which the Company does not have majority ownership, but has the ability to exert significant influence. The Company's investments in oil and natural gas limited partnerships for which it serves as general partner and exerts significant influence are accounted for under the equity method. All intercompany accounts and transactions have been eliminated.

Use of Estimates

        The preparation of the Company's unaudited condensed consolidated financial statements in conformity with accounting principles generally accepted in the United States requires the Company's management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities, if any, at the date of the unaudited condensed consolidated financial statements and the reported amounts of revenues and expenses during the respective reporting periods. Estimates and assumptions that, in the opinion of management of the Company, are significant include oil and natural gas revenue, capital and operating expense accruals, oil and natural gas reserves, depletion relating to oil and natural gas properties, asset retirement obligations, fair value estimates, beneficial conversion feature estimates and income taxes. The

9

HALCÓN RESOURCES CORPORATION

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)

1. FINANCIAL STATEMENT PRESENTATION (Continued)

Company bases its estimates and judgments on historical experience and on various other assumptions and information that are believed to be reasonable under the circumstances. Estimates and assumptions about future events and their effects cannot be perceived with certainty and, accordingly, these estimates may change as new events occur, as more experience is acquired, as additional information is obtained and as the Company's operating environment changes. Actual results may differ from the estimates and assumptions used in the preparation of the Company's unaudited condensed consolidated financial statements.

        Interim period results are not necessarily indicative of results of operations or cash flows for the full year and accordingly, certain information normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States, has been condensed or omitted. The Company has evaluated events or transactions through the date of issuance of these unaudited condensed consolidated financial statements.

Accounts Receivable and Allowance for Doubtful Accounts

        The Company's accounts receivable are primarily receivables from joint interest owners and oil and natural gas purchasers. Accounts receivable are recorded at the amount due, less an allowance for doubtful accounts, when applicable. The Company establishes provisions for losses on accounts receivable if it determines that collection of all or part of the outstanding balance is doubtful. The Company regularly reviews collectability and establishes or adjusts the allowance for doubtful accounts as necessary using the specific identification method. There are no significant allowances for doubtful accounts as of June 30, 2013 or December 31, 2012.

Other Operating Property and Equipment

        Gas gathering systems and equipment are recorded at cost. Depreciation is calculated using the straight-line method over a 30-year estimated useful life. Upon disposition, the cost and accumulated depreciation are removed and any gains or losses are reflected in current operations. Maintenance and repair costs are charged to operating expense as incurred. Material expenditures which increase the life of an asset or productive capacity are capitalized and depreciated over the estimated remaining useful life of the asset. The Company has capitalized $112.0 million and $39.9 million as of June 30, 2013 and December 31, 2012, respectively, related to the construction of its gas gathering systems.

        Other operating assets are recorded at cost. Depreciation is calculated using the straight-line method over the following estimated useful lives: automobiles and computers, three years; computer software, leasehold improvements, fixtures, furniture and equipment, five years or the lesser of lease term; trailers, seven years; heavy equipment, ten years; and an airplane and buildings, twenty years. Upon disposition, the cost and accumulated depreciation are removed and any gains or losses are reflected in current operations. Maintenance and repair costs are charged to operating expense as incurred. Material expenditures which increase the life of an asset are capitalized and depreciated over the estimated remaining useful life of the asset.

        The Company reviews its gas gathering systems and equipment and other operating assets for impairment in accordance with ASC 360, Property, Plant, and Equipment (ASC 360). ASC 360 requires the Company to evaluate gas gathering systems and equipment and other operating assets for impairment as events occur or circumstances change that would more likely than not reduce the fair value below the carrying amount. If the carrying amount is not recoverable from its undiscounted cash

10

HALCÓN RESOURCES CORPORATION

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)

1. FINANCIAL STATEMENT PRESENTATION (Continued)

flows, then the Company would recognize an impairment loss for the difference between the carrying amount and the current fair value. Further, the Company evaluates the remaining useful lives of its gas gathering systems and other operating assets at each reporting period to determine whether events and circumstances warrant a revision to the remaining depreciation periods.

Goodwill

        Goodwill represents the excess of the purchase price over the estimated fair value of the assets acquired net of the fair value of liabilities assumed in an acquisition. ASC 350, Intangibles—Goodwill and Other (ASC 350) requires that intangible assets with indefinite lives, including goodwill, be evaluated on an annual basis for impairment or more frequently if events occur or circumstances change that could potentially result in impairment. The goodwill impairment test requires the allocation of goodwill and all other assets and liabilities to reporting units. However, the Company has only one reporting unit. The Company's goodwill relates to its acquisition of GeoResources. Refer to Note 4, "Acquisitions" for more details regarding the Merger between the Company and GeoResources. The Company will perform its goodwill impairment test annually as of July 1, beginning in the third quarter of 2013, or more often if circumstances require.

Recently Issued Accounting Pronouncements

        In December 2011, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) No. 2011-11, Disclosures about Offsetting Assets and Liabilities (ASU 2011-11), which enhances disclosures by requiring an entity to disclose information about netting arrangements, including rights of offset, to enable users of its financial statements to understand the effect of those arrangements on its financial position. This pronouncement was issued to facilitate comparison between financial statements prepared on the basis of accounting principles generally accepted in the United States and International Financial Reporting Standards. In addition, in January 2013, the FASB issued ASU No. 2013-01, Clarifying the Scope of Disclosures about Offsetting Assets and Liabilities (ASU 2013-01), which requires clarification of the specific instruments that should be considered in the offsetting disclosures. These updates are effective for annual and interim reporting periods beginning on or after January 1, 2013 and are to be applied retroactively for all comparative periods presented. The adoption of ASU 2011-11 and ASU 2013-01 resulted in new disclosures related to the Company's derivative activities. See further information at Note 8, "Derivative and Hedging Activities."

        In February 2013, the FASB issued ASU No. 2013-04, Obligations Resulting from Joint and Several Liability Arrangements for which the Total Amount of the Obligation is Fixed at the Reporting Date (ASU 2013-04). ASU 2013-04 provides guidance for the recognition, measurement, and disclosure of obligations resulting from joint and several liability arrangements, such as debt arrangements, other contractual obligations and settled litigation and judicial rulings. This pronouncement must be applied retrospectively and is effective for fiscal years, and interim periods within those years, beginning after December 15, 2013. The Company is currently assessing the impact, if any, that the adoption of ASU 2013-04 will have on its operating results, financial position and disclosures.

        In February 2013, the FASB issued ASU No. 2013-11, Presentation of an Unrecognized Tax Benefit When a Net Operating Loss Carryforward, a Similar Tax Loss, or a Tax Credit Carryforward Exists (ASU 2013-11). ASU 2013-11 provides explicit guidance on the financial statement presentation of an unrecognized tax benefit when a net operating loss carryforward, a similar tax loss, or a tax credit

11

HALCÓN RESOURCES CORPORATION

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)

1. FINANCIAL STATEMENT PRESENTATION (Continued)

carryforward exists. This pronouncement should be applied prospectively to all unrecognized tax benefits that exist at the effective date and retrospective application is permitted. ASU 2013-11 is effective for fiscal years, and interim periods within those years, beginning after December 15, 2013. The Company is currently assessing the impact, if any, that the adoption of this pronouncement will have on its operating results and financial position.

2. RECAPITALIZATION

        On December 21, 2011, the Company entered into a Securities Purchase Agreement (the Purchase Agreement) with HALRES LLC, formerly Halcón Resources, LLC (HALRES). Pursuant to the Purchase Agreement, (i) HALRES purchased and the Company sold 73.3 million shares of the Company's common stock (the Shares) for a purchase price of $275 million and (ii) HALRES purchased and the Company issued a senior convertible promissory note in the principal amount of $275 million (the 2017 Note), together with five year warrants (the February 2012 Warrants) to purchase 36.7 million shares of the Company's common stock at an exercise price of $4.50 per share (the Recapitalization), subject to adjustment under certain circumstances. The 2017 Note is convertible after February 8, 2014 into 61.1 million shares of common stock at a conversion price of $4.50 per share, subject to adjustment under certain circumstances. The Company and HALRES closed the transaction contemplated by the Purchase Agreement on February 8, 2012.

        In January 2012, shareholders holding a majority of the Company's outstanding shares of common stock approved the issuance of the Shares, the 2017 Note and the February 2012 Warrants pursuant to the terms of the Purchase Agreement. Additionally, the Board of Directors approved, effective upon the closing (i) the amendment of the Company's certificate of incorporation to (a) increase the Company's authorized shares of common stock from 100 million shares to 1.01 billion shares, both of which were before the one-for-three reverse stock split; (b) a one-for-three reverse stock split of the Company's common stock (which reduced the Company's authorized shares of common stock from 1.01 billion to 336.7 million shares); and (c) a name change from RAM Energy Resources, Inc. to Halcón Resources Corporation; (ii) the amendment of the Company's 2006 Long-Term Incentive Plan (the Plan) to increase the number of shares that may be issued under the Plan from 2.5 million to 3.7 million shares; and (iii) on an advisory (non-binding) basis, the payments made to the Company's named executive officers in connection with the transactions contemplated by the Purchase Agreement.

        The closing of the transaction resulted in a change in control of the Company. Material events and items resulting from the transaction include the following:

•

completion of transactions contemplated by the Purchase Agreement and shareholder approval as discussed above;

•

the resignation and termination of the Company's four executive officers and the resignation of certain other officers;

•

change in control payments of $4.6 million to the officers of the Company recorded in general and administrative expense;

•

change in control payment of $0.8 million pursuant to a retainer agreement with the Company's then outside law firm recorded in general and administrative expense;

12

HALCÓN RESOURCES CORPORATION

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)

2. RECAPITALIZATION (Continued)

•

accelerated vesting of all unvested employee restricted stock shares and accelerated vesting and exercise of all unvested stock appreciation rights resulting in $4.3 million of share-based compensation expense recorded in general and administrative expense;

•

payoff and termination of the Company's March 2011 Credit Facilities of $133.0 million plus accrued interest, as well as the expensing of the related unamortized debt issuance costs of $2.9 million;

•

payoff and termination of the Company's second lien term facility of $75.0 million plus accrued interest and a prepayment fee of $1.5 million, as well as the expensing of the related unamortized debt issuance costs of $2.9 million; and

•

closing costs of $11.2 million related to engagement fees and various professional fees including $2.5 million recorded in general and administrative expense related to a termination fee pursuant to a previous engagement.

        In January 2012, the Company approved a one-for-three reverse stock split, which was implemented on February 10, 2012. Retroactive application of the reverse stock split is required and all share and per share information included for all periods presented in these unaudited condensed consolidated financial statements reflects the reverse stock split.

        In February 2012, the transaction with HALRES resulted in an "ownership change" as defined under Section 382 of the Internal Revenue Code of 1986, as amended. As a consequence, the Company has additional limitations on its ability to use the net operating losses it accrued before the ownership change as a deduction against any taxable income the Company realizes after the ownership change.

3. RESTRUCTURING

        In March 2012, the Company announced its intention to close its Plano, Texas office and begin the process of relocating key administrative functions to Houston, Texas (the Restructuring). As part of the Restructuring, the Company offered certain severance and retention benefits, collectively known as the Severance Program, to the affected employees. The total expense of the Severance Program was approximately $2.9 million and related costs were recognized as restructuring expense over the requisite service periods through May 2013, as applicable. Following is a reconciliation of the beginning and ending liability balance.

	Severance Program
	(In thousands)
Ending balance, December 31, 2012	$	2,131
Severance and retention payments		(2,627	)
Increase in accrual		496
Ending balance, June 30, 2013	$	—

13

HALCÓN RESOURCES CORPORATION

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)

4. ACQUISITIONS

Williston Basin Assets

        On December 6, 2012, the Company completed the acquisition of two wholly-owned subsidiaries of Petro-Hunt Holdings, LLC and Pillar Holdings, LLC (the Petro-Hunt Parties), which owned acreage prospective for the Bakken / Three Forks formations located in North Dakota, in Williams, Montrail, McKenzie and Dunn counties (the Williston Basin Assets). The Company completed the acquisition of the Williston Basin Assets for total consideration of approximately $1.5 billion, consisting of approximately $785.8 million in cash and approximately 10,880 shares of the Company's preferred stock that automatically converted into 108.8 million shares of Halcón common stock on January 18, 2013 (equivalent to a conversion price of approximately $7.45 per share of Halcón common stock based on the liquidation preference), following stockholder approval of such conversion and an amendment to Halcón's certificate of incorporation to increase the number of shares of common stock that Halcón is authorized to issue (the Williston Basin Acquisition). The Williston Basin Acquisition significantly expanded the Company's presence in North Dakota, adding undeveloped acreage, oil and natural gas reserves and production to its existing asset base and operations in this area.

        The transaction had an effective date of June 1, 2012 and was subject to customary closing conditions, as well as the execution and delivery of certain other agreements, including a registration rights agreement. Under the terms of the registration rights agreement, as amended, Halcón agreed to file with the SEC on or before October 2, 2013, a shelf registration statement covering resales of the 108.8 million shares of Halcón common stock issued as partial consideration in the Williston Basin Acquisition and use commercially reasonable efforts to cause the registration statement to be declared effective as soon as reasonably practicable after the registration statement is filed.

GeoResources, Inc.

        On August 1, 2012, the Company completed an acquisition of GeoResources, Inc. (GeoResources) by means of the merger of GeoResources into a wholly-owned subsidiary of the Company (the Merger) and began reflecting GeoResources' results of operations in the Company's unaudited condensed consolidated statements of operations. In connection with the Merger, each share of GeoResources common stock issued and outstanding immediately prior to the effective date of the Merger was converted into the right to receive $20.00 in cash and 1.932 shares of the Company's common stock.

        In connection with the consummation of the Merger, the Company issued a total of approximately 51.3 million shares of its common stock and paid approximately $531.5 million in cash to former GeoResources stockholders in exchange for their shares of GeoResources common stock, resulting in a total purchase price plus liabilities assumed of approximately $1.3 billion. The acquisition expanded the Company's presence in the Bakken / Three Forks formations of North Dakota and Montana, and the Austin Chalk trend and Eagle Ford Shale in Texas, adding oil and natural gas reserves and production to its existing asset base in these areas.

East Texas Assets

        In August 2012, the Company completed the acquisition of oil and gas leaseholds in East Texas (the East Texas Assets) from CH4 Energy II, LLC, PetroMax Leon, LLC, Petro Texas LLC, King King LLC and several other selling parties for total consideration of $426.8 million comprised of $296.1 million in cash and 20.8 million shares of the Company's common stock (the East Texas Acquisition). The effective date of the East Texas Acquisition was April 1, 2012. The East Texas

14

HALCÓN RESOURCES CORPORATION

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)

4. ACQUISITIONS (Continued)

Acquisition expanded the Company's presence in East Texas, adding oil and natural gas reserves and production to its existing asset base in this area.

Pro Forma Impact of Acquisitions (Unaudited)

        As disclosed in the Company's Annual Report on Form 10-K for the year ended December 31, 2012, the acquisitions of the Williston Basin Assets and the East Texas Assets, as well as the Merger were accounted for as business combinations in accordance with Accounting Standards Codification (ASC) No. 805, Business Combinations (ASC 805) which, among other things, requires assets acquired and liabilities assumed to be measured at their acquisition date fair values. Certain assets and liabilities may be adjusted as additional information is obtained, but no later than one year from the respective acquisition dates. The purchase prices for the Williston Basin Assets, the East Texas Assets and the Merger are still preliminary due to the use of estimates based on information that was available to management. During the six months ended June 30, 2013, there were no adjustments to the purchase price of the East Texas Assets; however, there were minor adjustments to the respective purchase prices of GeoResources and the Williston Basin Assets related to accruals, settlements and working capital changes as a result of better information obtained during the period.

        The following unaudited pro forma combined results of operations are provided for the three and six months ended June 30, 2012 as though the Merger, the East Texas Acquisition and the Williston Basin Acquisition had been completed as of the beginning of the comparable prior annual reporting period, or January 1, 2011. The pro forma combined results of operations for the three and six months ended June 30, 2012 have been prepared by adjusting the historical results of the Company to include the historical results of GeoResources, the East Texas Assets and the Williston Basin Assets. These supplemental pro forma results of operations are provided for illustrative purposes only and do not purport to be indicative of the actual results that would have been achieved by the combined company for the period presented or that may be achieved by the combined company in the future. The pro forma results of operations do not include any cost savings or other synergies that resulted, or may result, from the Merger, the East Texas Acquisition and the Williston Basin Acquisition, or any estimated costs that will be incurred to integrate GeoResources, the Williston Basin Assets and the East Texas Assets. Future results may vary significantly from the results reflected in this unaudited pro forma financial information because of future events and transactions, as well as other factors.

        The Company's historical financial information was adjusted to give effect to the pro forma events that were directly attributable to the Merger, the East Texas Acquisition and the Williston Basin Acquisition, and that were factually supportable. Adjustments and assumptions made for this pro forma calculation are consistent with those used in the Company's annual pro forma information, as more fully described in Item 8. Consolidated Financial Statements and Supplementary Data—Note 5,

15

HALCÓN RESOURCES CORPORATION

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)

4. ACQUISITIONS (Continued)

"Acquisitions and Divestitures" to the Company's Annual Report on Form 10-K for the year ended December 31, 2012.

(In thousands, except per share amounts)	Three Months Ended June 30, 2012 (Unaudited)			Six Months Ended June 30, 2012 (Unaudited)
Revenue	$	151,738		$	278,315
Net income		49,234			30,494
Loss available to Halcón common stockholders		(38,109	)		(57,951	)
Pro forma net loss per common share:
Basic	$	(0.12	)	$	(0.20	)
Diluted	$	(0.12	)	$	(0.20	)

5. OIL AND NATURAL GAS PROPERTIES

        The Company uses the full cost method of accounting for its investment in oil and natural gas properties. Under this method of accounting, all costs of acquisition, exploration and development of oil and natural gas reserves (including such costs as leasehold acquisition costs, geological expenditures, dry hole costs, tangible and intangible development costs and direct internal costs) are capitalized as the cost of oil and natural gas properties when incurred. To the extent capitalized costs of evaluated oil and natural gas properties, net of accumulated depletion, exceed the discounted future net revenues of proved oil and natural gas reserves, net of deferred taxes, such excess capitalized costs are charged to expense.

        The Company assesses all properties classified as unevaluated property on a quarterly basis for possible impairment or reduction in value. The Company assesses properties on an individual basis or as a group, if properties are individually insignificant. The assessment includes consideration of the following factors, among others: intent to drill; remaining lease term; geological and geophysical evaluations; drilling results and activity; the assignment of proved reserves; and the economic viability of development if proved reserves are assigned. During any period in which these factors indicate an impairment, the cumulative drilling costs incurred to date for such property and all or a portion of the associated leasehold costs are transferred to the full cost pool and are then subject to depletion and the full cost ceiling test limitation.

        Investments in unevaluated oil and natural gas properties and exploration and development projects for which depletion expense is not currently recognized, and for which exploration or development activities are in progress, qualify for interest capitalization. The capitalized interest is determined by multiplying the Company's weighted-average borrowing cost on debt by the average amount of qualifying costs incurred that are excluded from the full cost pool; however, the amount of capitalized interest cannot exceed the amount of gross interest expense incurred in any given period. The capitalized interest amounts are recorded as additions to unevaluated oil and natural gas properties on the unaudited condensed consolidated balance sheets. As the costs excluded are transferred to the full cost pool, the associated capitalized interest is also transferred to the full cost pool. For the three and six months ended June 30, 2013, the Company capitalized interest costs of $53.5 million and $106.4 million, respectively. For the three and six months ended June 30, 2012, the Company capitalized interest costs of $3.3 million and $3.4 million, respectively.

16

HALCÓN RESOURCES CORPORATION

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)

5. OIL AND NATURAL GAS PROPERTIES (Continued)

        At June 30, 2013 the ceiling test value of the Company's reserves was calculated based on the first day average of the 12-months ended June 30, 2013 of the West Texas Intermediate (WTI) spot price of $91.60 per barrel, adjusted by lease or field for quality, transportation fees, and regional price differentials, and the first day average of the 12-months ended June 30, 2013 of the Henry Hub price of $3.45 per million British thermal units (Mmbtu), adjusted by lease or field for energy content, transportation fees, and regional price differentials. Using these prices, the Company's net book value of oil and natural gas properties at June 30, 2013 did not exceed the ceiling amount. Changes in production rates, levels of reserves, future development costs, and other factors will determine the Company's actual ceiling test calculation and impairment analyses in future periods.

        At June 30, 2012 the ceiling test value of the Company's reserves was calculated based on the first day average of the 12-months ended June 30, 2012 of the WTI spot price of $95.67 per barrel, adjusted by lease or field for quality, transportation fees, and regional price differentials, and the first day average of the 12-months ended June 30, 2012 of the Henry Hub price of $3.15 per Mmbtu, adjusted by lease or field for energy content, transportation fees, and regional price differentials. Using these prices, the Company's net book value of oil and natural gas properties at June 30, 2012 did not exceed the ceiling amount.

6. LONG-TERM DEBT

        Long-term debt as of June 30, 2013 and December 31, 2012 consisted of the following:

	June 30, 2013		December 31, 2012(1)
	(In thousands)
Senior revolving credit facility	$	343,000	$	298,000
8.875% $1.35 billion senior notes(2)		1,373,429		744,421
9.75% $750 million senior notes(3)		740,669		740,232
8.0% $275 million convertible note(4)		255,460		251,845
Deferred premiums on derivative contracts		1,389		—
	$	2,713,947	$	2,034,498

⁽¹⁾

Table excludes $74.7 million of promissory notes which were classified as current at December 31, 2012.

⁽²⁾

Amount is net of a $5.4 million and a $5.6 million unamortized discount at June 30, 2013 and December 31, 2012, respectively, related to the issuance of the original 2021 Notes. On January 14, 2013, the Company completed the issuance of an additional $600 million of its 2021 Notes. The unamortized premium related to these additional 2021 Notes was approximately $28.8 million at June 30, 2013. See "8.875% Senior Notes" below for more details.

⁽³⁾

Amount is net of a $9.3 million and a $9.8 million unamortized discount at June 30, 2013 and December 31, 2012, respectively. See "9.75% Senior Notes" below for more details.

⁽⁴⁾

Amount is net of a $34.2 million and a $37.8 million unamortized discount at June 30, 2013 and December 31, 2012, respectively. See "8.0% Convertible Note" below for more details.

17

HALCÓN RESOURCES CORPORATION

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)

6. LONG-TERM DEBT (Continued)

Senior Revolving Credit Facility

        In connection with the closing of the Recapitalization, discussed in Note 2, "Recapitalization," the Company entered into a senior secured revolving credit agreement (the Senior Credit Agreement) with JPMorgan Chase Bank, N.A., as administrative agent, and the other lenders party thereto on February 8, 2012. The Senior Credit Agreement provides for a $1.5 billion facility with a current borrowing base of $810.0 million. Amounts borrowed under the Senior Credit Agreement will mature on February 8, 2017. The borrowing base will be redetermined semi-annually, with the lenders and the Company each having the right to one interim unscheduled redetermination between any two consecutive semi-annual redeterminations. The borrowing base takes into account the Company's oil and natural gas properties, proved reserves, total indebtedness, and other relevant factors consistent with customary oil and natural gas lending criteria. The borrowing base is subject to a reduction equal to the product of 0.25 multiplied by the stated principal amount (without regard to any initial issue discount) of any future notes or other long-term debt securities that the Company may issue. Funds advanced under the Senior Credit Agreement may be paid down and re-borrowed during the five-year term of the revolver. Amounts outstanding under the Senior Credit Agreement bear interest at specified margins over the base rate of 0.50% to 1.50% for ABR-based loans or at specified margins over LIBOR of 1.50% to 2.50% for Eurodollar-based loans. These margins fluctuate based on the Company's utilization of the facility. Advances under the Senior Credit Agreement are secured by liens on substantially all of the Company's properties and assets. The Senior Credit Agreement contains customary representations, warranties and covenants including, among others, restrictions on the payment of dividends on the Company's capital stock and financial covenants, including minimum working capital levels (the ratio of current assets plus the unused commitment under the Senior Credit Agreement to current liabilities) of not less than 1.0 to 1.0 and minimum coverage of interest expenses (as defined in the Senior Credit Agreement) of not less than 2.5 to 1.0.

        At June 30, 2013, the Company had $343.0 million of indebtedness outstanding, $1.2 million of letters of credit outstanding and $505.8 million of borrowing capacity available under the Senior Credit Agreement. At June 30, 2013, the Company was in compliance with the financial debt covenants under the Senior Credit Agreement. Upon the closing of the Eagle Ford divestiture, the borrowing base under the Senior Credit Agreement was reduced from $850.0 million to $810.0 million. See Note 15, "Subsequent Event" for further discussion of this transaction.

        On January 25, 2013, the Company entered into the Second Amendment (the Second Amendment) which amends the Senior Credit Agreement with respect to the Company's ability to enter into certain commodity hedging agreements. The Second Amendment provides, among other things, that the Company and its subsidiaries may enter into commodity swap, collar and/or call option agreements with approved counterparties so long as the volumes for such agreements do not exceed 85% of the Company's internally forecasted production from (i) the Company's crude oil, natural gas liquids and natural gas, or (ii) in the case of a proposed acquisition of oil and gas properties, such oil and gas properties that are the subject of such proposed acquisition, in each case for the 24 months following the date such agreement is entered into. Additionally, the Company may enter into commodity swap, collar and/or call option agreements so long as the volumes for such agreements do not exceed 85% of (i) the reasonably anticipated projected production from the Company's proved reserves for the period of 25 to 66 months following the date such agreement is entered into, or (ii) in the case of a proposed acquisition of oil and gas properties, the reasonably anticipated projected production from proved reserves from such oil and gas properties that are the subject of such proposed

18

HALCÓN RESOURCES CORPORATION

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)

6. LONG-TERM DEBT (Continued)

acquisition for the period of 25 to 48 months following the date such agreement is entered into. The 85% limitations discussed above do not apply to volumes hedged by the Company using puts, floors and/or basis differential swap agreements.

        Prior to the Second Amendment, the volumes for commodity swap, collar and/or call option agreements under the Senior Credit Agreement could not exceed 85% of the reasonably anticipated projected production from the Company's proved reserves (as forecast based upon the most recently delivered reserve report), for each month during the period during which the agreement was in effect for each of crude oil, natural gas liquids and natural gas, for the 66 months following the date such agreement was entered into.

        On April 26, 2013, the Company entered into the Third Amendment which amends the Senior Credit Agreement in order to provide, among other things, additional flexibility under certain affirmative and negative covenants.

        On May 8, 2013, the Company entered into the Fourth Amendment to the Senior Credit Agreement (the Fourth Amendment). The Fourth Amendment provides for EBITDA (as defined in the Senior Credit Agreement) to be annualized for the balance of calendar year 2013 for purposes of measuring compliance with the interest coverage test. Specifically, (i) for the fiscal quarter ended June 30, 2013, the Interest Coverage Ratio shall be calculated by utilizing EBITDA for the three month period then ended multiplied by 4; (ii) for the fiscal quarter ended September 30, 2013, the Interest Coverage Ratio shall be calculated by utilizing EBITDA for the six month period then ended multiplied by 2; and (iii) for the fiscal quarter ended December 31, 2013, the Interest Coverage Ratio shall be calculated by utilizing EBITDA for the nine month period then ended multiplied by 4/3.

        On June 11, 2013, the Company entered into the Fifth Amendment to the Senior Credit Agreement (the Fifth Amendment). The Fifth Amendment provides, among other things, for the Company to pay cash dividends to holders of the Company's preferred capital stock.

8.875% Senior Notes

        On November 6, 2012, the Company issued $750 million aggregate principal amount of its 8.875% senior notes due 2021 (the 2021 Notes), at a price to the initial purchasers of 99.247% of par. The net proceeds from the offering of approximately $725.6 million (after deducting the initial purchasers' discounts, commissions and offering expenses) were used to fund a portion of the cash consideration paid in the Williston Basin Acquisition.

        On January 14, 2013, the Company issued an additional $600 million aggregate principal amount of the 2021 Notes at a price to the initial purchasers of 105% of par. The net proceeds from the sale of the additional 2021 Notes of approximately $619.5 million (after the initial purchasers' premiums, commissions and offering expenses) were used to repay all of the then outstanding borrowings under the Senior Credit Agreement and for general corporate purposes, including funding a portion of the Company's 2013 capital expenditures program. These notes were issued as "additional notes" under the indenture governing the 2021 Notes and under the indenture are treated as a single series with substantially identical terms as the 2021 Notes previously issued.

        The 2021 Notes bear interest at a rate of 8.875% per annum, payable semi-annually on May 15 and November 15 of each year, beginning on May 15, 2013. The Notes will mature on May 15, 2021. The 2021 Notes are senior unsecured obligations of the Company and rank equally with all of its

19

HALCÓN RESOURCES CORPORATION

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)

6. LONG-TERM DEBT (Continued)

current and future senior indebtedness. The 2021 Notes are jointly and severally, fully and unconditionally guaranteed on a senior unsecured basis by the Company's existing wholly-owned subsidiaries. Halcón, the issuer of the 2021 Notes, has no material independent assets or operations apart from the assets and operations of its subsidiaries.

        On June 4, 2013, the Company completed a registered exchange offer of outstanding 2021 Notes for new registered notes having terms substantially identical to the 2021 Notes.

        On or before November 15, 2015, the Company may redeem up to 35% of the aggregate principal amount of the 2021 Notes with the net cash proceeds of certain equity offerings at a redemption price of 108.875% of the principal amount plus accrued and unpaid interest to the redemption date provided that: at least 65% in aggregate principal amount of the 2021 Notes originally issued remains outstanding immediately after the redemption and the redemption occurs within 180 days of the date of closing of the related equity offering. In addition, at any time prior to November 15, 2016, the Company may redeem some or all of the 2021 Notes for the principal amount thereof, plus accrued and unpaid interest plus a make whole premium equal to the excess, if any of (a) the present value at such time of (i) the redemption price of such note at November 15, 2016, plus (ii) any required interest payments due on the notes through November 15, 2016 (excluding currently accrued and unpaid interest) computed using a discount rate equal to the Treasury Rate plus 50 basis points, discounted to the redemption date on a semi-annual basis, over (b) the principal amount of such note.

        In conjunction with the issuance of the 2021 Notes, the Company recorded a discount of approximately $5.7 million to be amortized over the remaining life of the 2021 Notes using the effective interest method. The remaining unamortized discount was $5.4 million at June 30, 2013. In conjunction with the issuance of the additional 2021 Notes, the Company recorded a premium of approximately $30.0 million to be amortized over the remaining life of the additional 2021 Notes using the effective interest method. The remaining unamortized premium was $28.8 million at June 30, 2013.

9.75% Senior Notes

        On July 16, 2012, the Company issued $750 million aggregate principal amount of 9.75% senior notes due 2020 issued at 98.646% of par (the 2020 Notes). The net proceeds from the offering were approximately $723.1 million after deducting the initial purchasers' discounts, commissions and offering expenses and were used to fund a portion of the cash consideration paid in the Merger and the East Texas Acquisition.

        The 2020 Notes bear interest at a rate of 9.75% per annum, payable semi-annually on January 15 and July 15 of each year, beginning on January 15, 2013. The 2020 Notes will mature on July 15, 2020. The 2020 Notes are senior unsecured obligations of the Company and rank equally with all of its current and future senior indebtedness. The 2020 Notes are jointly and severally, fully and unconditionally guaranteed on a senior unsecured basis by the Company's existing wholly-owned subsidiaries. Halcón, the issuer of the 2020 Notes, has no material independent assets or operations apart from the assets and operations of its subsidiaries.

        On June 4, 2013, the Company completed a registered exchange offer of outstanding 2020 Notes for new registered notes having terms substantially identical to the 2020 Notes.

        On or before July 15, 2015, the Company may redeem up to 35% of the aggregate principal amount of the 2020 Notes with the net cash proceeds of certain equity offerings at a redemption price

20

HALCÓN RESOURCES CORPORATION

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)

6. LONG-TERM DEBT (Continued)

of 109.750% of the principal amount plus accrued and unpaid interest to the redemption date provided that: at least 65% in aggregate principal amount of the 2020 Notes originally issued remains outstanding immediately after the redemption and the redemption occurs within 180 days of the equity offering. In addition, at any time prior to July 15, 2016, the Company may redeem some or all of the 2020 Notes for the principal amount thereof, plus accrued and unpaid interest plus a make whole premium equal to the excess , if any of (a) the present value at such time of (i) the redemption price of such note at July 15, 2016, plus (ii) any required interest payments due on the notes through July 15, 2016 (excluding currently accrued and unpaid interest) computed using a discount rate equal to the Treasury Rate plus 50 basis points, discounted to the redemption date on a semi-annual basis, over (b) the principal amount of such note.

        In conjunction with the issuance of the 2020 Notes, the Company recorded a discount of approximately $10.2 million to be amortized over the remaining life of the 2020 Notes using the effective interest method. The remaining unamortized discount was $9.3 million at June 30, 2013.

8.0% Convertible Note

        On February 8, 2012, the Company issued the 2017 Note in the principal amount of $275.0 million together with the February 2012 Warrants for an aggregate purchase price of $275.0 million. The 2017 Note bears interest at a rate of 8% per annum, payable quarterly on March 31, June 30, September 30 and December 31 of each year and matures on February 8, 2017. Through the March 31, 2014 interest payment date, the Company may elect to pay-in-kind, by adding to the principal of the 2017 Note, all or any portion of the interest due on the 2017 Note. The Company elected to pay the interest in kind on March 31, June 30 and September 30, 2012, and rolled $3.2 million, $5.7 million and $5.8 million of interest incurred during the first, second and third quarters of 2012, respectively, into the 2017 Note, increasing the principal amount to $289.7 million. The Company did not elect to pay-in-kind interest for the quarterly payments due subsequent to September 30, 2012. At any time after February 8, 2014, the noteholder may elect to convert all or any portion of the principal amount and accrued but unpaid interest into common stock. Each $4.50 of principal and accrued but unpaid interest is convertible into one share of the Company's common stock. The 2017 Note is a senior unsecured obligation of the Company.

        The Company allocated the proceeds received for the 2017 Note and February 2012 Warrants on a relative fair value basis. Consequently, the Company recorded a discount of $43.6 million to be amortized over the remaining life of the 2017 Note utilizing the effective interest rate method. The remaining unamortized discount was $34.2 million at June 30, 2013.

21

HALCÓN RESOURCES CORPORATION

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)

6. LONG-TERM DEBT (Continued)

Promissory Notes

        On December 28, 2012, the Company completed the acquisition of certain oil and natural gas properties in Brazos County, Texas for approximately $83.7 million, before and subject to, customary closing adjustments, consisting of approximately $8.4 million in cash and approximately $75.3 million in promissory notes. During the six months ended June 30, 2013, the Company completed its review of the properties and paid approximately $62.4 million during the period for properties deemed to have clear title and no defects. In addition, notice was given to the sellers of the Company's assertion of title and environmental defects amounting to $12.9 million for the remaining properties. The promissory notes were classified as current at December 31, 2012.

        In conjunction with the issuance of the promissory notes in December 2012, the Company recorded a discount of approximately $0.6 million to be amortized over the remaining life of the promissory notes using the effective interest method. The Company expensed the discount during the first quarter of 2013.

Debt Issuance Costs

        The Company capitalizes certain direct costs associated with the issuance of long-term debt and amortizes such costs over the lives of the respective debt. During the first six months of 2013, the Company capitalized approximately $11.5 million in costs associated with the issuance of the additional 2021 Notes and costs incurred for amendments to the Company's Senior Credit Agreement. At June 30, 2013 and December 31, 2012, the Company had approximately $59.3 million and $51.6 million, respectively, of unamortized debt issuance costs.

7. FAIR VALUE MEASUREMENTS

        Pursuant to ASC 820, Fair Value Measurements and Disclosures (ASC 820), the Company's determination of fair value incorporates not only the credit standing of the counterparties involved in transactions with the Company resulting in receivables on the Company's unaudited condensed consolidated balance sheets, but also the impact of the Company's nonperformance risk on its own liabilities. ASC 820 defines fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date (exit price). ASC 820 establishes a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value. The hierarchy assigns the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1) and the lowest priority to unobservable inputs (Level 3). Level 2 measurements are inputs that are observable for assets or liabilities, either directly or indirectly, other than quoted prices included within Level 1. The Company utilizes market data or assumptions that market participants would use in pricing the asset or liability, including assumptions about risk and the risks inherent in the inputs to the valuation technique. These inputs can be readily observable, market corroborated, or generally unobservable. The Company classifies fair value balances based on the observability of those inputs.

        The following tables set forth by level within the fair value hierarchy the Company's financial assets and liabilities that were accounted for at fair value as of June 30, 2013 and December 31, 2012. As required by ASC 820, a financial instrument's level within the fair value hierarchy is based on the lowest level of input that is significant to the fair value measurement. The Company's assessment of the significance of a particular input to the fair value measurement requires judgment, and may affect the

22

HALCÓN RESOURCES CORPORATION

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)

7. FAIR VALUE MEASUREMENTS (Continued)

valuation of fair value assets and liabilities and their placement within the fair value hierarchy levels. There were no transfers between fair value hierarchy levels for the six months ended June 30, 2013.

	June 30, 2013
	Level 1		Level 2		Level 3		Total
	(In thousands)
Assets
Receivables from derivative contracts	$	—	$	20,635	$	—	$	20,635
Liabilities
Liabilities from derivative contracts	$	—	$	5,198	$	—	$	5,198

	December 31, 2012
	Level 1		Level 2		Level 3		Total
	(In thousands)
Assets
Receivables from derivative contracts	$	—	$	7,799	$	—	$	7,799
Liabilities
Liabilities from derivative contracts	$	—	$	12,890	$	—	$	12,890
Liabilities from warrants(1)		—		1,342		—		1,342
Total Liabilities	$	—	$	14,232	$	—	$	14,232

⁽¹⁾

Liabilities from August 2012 warrants are recorded in "Accounts payable and accrued liabilities" on the unaudited condensed consolidated balance sheets.

        Derivative contracts listed above include collars, swaps and put options that are carried at fair value. The Company records the net change in the fair value of these positions in "Net gain (loss) on derivative contracts" in the Company's unaudited condensed consolidated statements of operations. The Company is able to value the assets and liabilities based on observable market data for similar instruments, which resulted in the Company reporting its derivatives as Level 2. This observable data includes the forward curves for commodity prices based on quoted markets prices and implied volatility factors related to changes in the forward curves. See Note 8, "Derivative and Hedging Activities" for additional discussion of derivatives.

        As of June 30, 2013 and December 31, 2012, the Company's derivative contracts were with major financial institutions with investment grade credit ratings which are believed to have a minimal credit risk. As such, the Company is exposed to credit risk to the extent of nonperformance by the counterparties in the derivative contracts; however, the Company does not anticipate such nonperformance. Each of the counterparties to the Company's current derivative contracts is a lender or an affiliate of a lender in the Company's Senior Credit Agreement. The Company did not post collateral under any of these contracts as they are secured under the Senior Credit Agreement.

        Warrants listed above at December 31, 2012 were carried at fair value. The Company recorded the net change in fair value on the August 2012 Warrants in "Interest expense and other, net" in the Company's unaudited condensed consolidated statements of operations. At December 31, 2012 and March 31, 2013, the Company valued the August 2012 Warrants based on observable market data,

23

HALCÓN RESOURCES CORPORATION

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)

7. FAIR VALUE MEASUREMENTS (Continued)

including treasury rates, historical volatility and data for similar instruments which resulted in the Company reporting its warrants as Level 2. During the three months ended March 31, 2013, an unrealized gain of $0.3 million was recorded to reflect the change in fair value. During the three months ended June 30, 2013, the Company recorded a gain of $1.6 million for the expiration of the warrants. See Note 11, "Preferred Stock and Stockholders' Equity" for additional discussion on the terms of the warrants.

        The following disclosure of the estimated fair value of financial instruments is made in accordance with the requirements of ASC 825, Financial Instruments. The estimated fair value amounts have been determined at discrete points in time based on relevant market information. These estimates involve uncertainties and cannot be determined with precision. The estimated fair value of cash, accounts receivable and accounts payable approximates their carrying value due to their short-term nature. The estimated fair value of the Company's Senior Credit Agreement and the promissory notes approximates carrying value because the interest rates approximate current market rates. The following table presents the estimated fair values of the Company's fixed interest rate, long-term debt instruments as of June 30, 2013 and December 31, 2012 (excluding discounts, premiums and deferred premiums on derivative contracts):

	June 30, 2013				December 31, 2012
Debt	Carrying Amount		Estimated Fair Value		Carrying Amount		Estimated Fair Value
	(In thousands)
8.875% $1.35 billion senior notes	$	1,350,000	$	1,316,250	$	750,000	$	798,750
9.75% $750 million senior notes		750,000		753,750		750,000		815,160
8.0% $275 million convertible note		289,669		462,655		289,669		625,425
	$	2,389,669	$	2,532,655	$	1,789,669	$	2,239,335

        The fair value of the Company's fixed interest debt instruments was calculated using Level 2 criteria at June 30, 2013 and December 31, 2012.

        The Company follows the provisions of ASC 820, Fair Value Measurements, for nonfinancial assets and liabilities measured at fair value on a non-recurring basis. These provisions apply to the Company's initial recognition of asset retirement obligations for which fair value is used. The asset retirement obligation estimates are derived from historical costs and management's expectation of future cost environments; and therefore, the Company has designated these liabilities as Level 3. See Note 9, "Asset Retirement Obligations," for a reconciliation of the beginning and ending balances of the liability for the Company's asset retirement obligations.

8. DERIVATIVE AND HEDGING ACTIVITIES

        The Company is exposed to certain risks relating to its ongoing business operations, such as commodity price risk and interest rate risk. Derivative contracts are utilized to economically hedge the Company's exposure to price fluctuations and reduce the variability in the Company's cash flows associated with anticipated sales of future oil and natural gas production. The Company generally hedges a substantial, but varying, portion of anticipated oil and natural gas production for future periods. Derivatives are carried at fair value on the unaudited condensed consolidated balance sheets as assets or liabilities, with the changes in the fair value included in the unaudited condensed

24

HALCÓN RESOURCES CORPORATION

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)

8. DERIVATIVE AND HEDGING ACTIVITIES (Continued)

consolidated statements of operations for the period in which the change occurs. Historically, the Company has also entered into interest rate swaps to mitigate exposure to market rate fluctuations.

        It is the Company's policy to enter into derivative contracts, including interest rate derivatives, only with counterparties that are creditworthy financial institutions deemed by management as competent and competitive market makers. Each of the counterparties to the Company's current derivative contracts is a lender or an affiliate of a lender in its Senior Credit Agreement. The Company did not post collateral under any of these contracts as they are secured under the Company's Senior Credit Agreement.

        At June 30, 2013 and December 31, 2012, the Company's crude oil and natural gas derivative positions consisted of swaps, costless put/call "collars" and put options. Swaps are designed so that the Company receives or makes payments based on a differential between fixed and variable prices for crude oil and natural gas. A costless collar consists of a sold call, which establishes a maximum price the Company will receive for the volumes under contract and a purchased put that establishes a minimum price. A sold put option limits the exposure of the counterparty's risk should the price fall below the strike price. Sold put options limit the effectiveness of purchased put options at the low end of the put/call collars to market prices in excess of the strike price of the put option sold. The Company has elected to not designate any of its derivative contracts for hedge accounting. Accordingly, the Company records the net change in the mark-to-market valuation of these derivative contracts, as well as all payments and receipts on settled derivative contracts, in "Net gain (loss) on derivative contracts" on the unaudited condensed consolidated statements of operations.

        In February 2012, pursuant to the Senior Credit Agreement, the Company novated its oil and natural gas derivative instruments to counterparties that are lenders or affiliates of lenders within the Senior Credit Agreement resulting in a realized loss of $0.4 million for novation fees and terminated the interest rate derivatives resulting in a $0.6 million realized loss during the three months ended March 31, 2012.

        At June 30, 2013, the Company had 73 open commodity derivative contracts summarized in the following tables: 16 natural gas collar arrangements, one natural gas swap, 46 crude oil collar arrangements, five crude oil three-way collars, one crude oil put option, and four crude oil swaps.

        At December 31, 2012, the Company had 47 open commodity derivative contracts summarized in the following tables: two natural gas collar arrangements, two natural gas swaps, one natural gas basis swap, 28 crude oil collar arrangements, 10 crude oil three-way collars, and four crude oil swaps.

        All derivative contracts are recorded at fair market value in accordance with ASC 815 and ASC 820 and included in the unaudited condensed consolidated balance sheets as assets or liabilities.

25

HALCÓN RESOURCES CORPORATION

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)

8. DERIVATIVE AND HEDGING ACTIVITIES (Continued)

The following table summarizes the location and fair value amounts of all derivative contracts in the unaudited condensed consolidated balance sheets as of June 30, 2013 and December 31, 2012:

		Asset derivative contracts					Liability derivative contracts
Derivatives not designated as hedging contracts under ASC 815	Balance sheet location	June 30, 2013		December 31, 2012		Balance sheet location	June 30, 2013			December 31, 2012
		(In thousands)					(In thousands)
Commodity contracts	Current assets—receivables from derivative contracts	$	9,336	$	7,428	Current liabilities—liabilities from derivative contracts	$	(5,198	)	$	(10,429	)
Commodity contracts	Other noncurrent assets—receivables from derivative contracts		11,299		371	Other noncurrent liabilities—liabilities from derivative contracts		—			(2,461	)
Total derivatives not designated as hedging contracts under ASC 815		$	20,635	$	7,799		$	(5,198	)	$	(12,890	)

        The following table summarizes the location and amounts of the Company's realized and unrealized gains and losses on derivative contracts in the Company's unaudited condensed consolidated statements of operations:

		Amount of gain or (loss) recognized in income on derivative contracts for the Three Months Ended June 30,					Amount of gain or (loss) recognized in income on derivative contracts for the Six Months Ended June 30,
	Location of gain or (loss) recognized in income on derivative contracts
Derivatives not designated as hedging contracts under ASC 815		2013			2012		2013			2012
		(In thousands)					(In thousands)
Commodity contracts:
Unrealized gain (loss) on commodity contracts	Other income (expenses)—net gain (loss) on derivative contracts	$	34,515		$	12,638	$	17,716		$	7,176
Realized gain (loss) on commodity contracts	Other income (expenses)—net gain (loss) on derivative contracts		(415	)		1,033		(2,038	)		1,608
Total net gain (loss) on commodity contracts		$	34,100		$	13,671	$	15,678		$	8,784
Interest rate swaps:
Unrealized gain (loss) on interest rate swaps	Other income (expenses)—net gain (loss) on derivative contracts	$	—		$	—	$	—		$	518
Realized gain (loss) on interest rate swaps	Other income (expenses)—net gain (loss) on derivative contracts		—			—		—			(576	)
Total net gain (loss) on interest rate swaps		$	—		$	—	$	—		$	(58	)
Total net gain (loss) on derivative contracts	Other income (expenses)—net gain (loss) on derivative contracts	$	34,100		$	13,671	$	15,678		$	8,726

26

HALCÓN RESOURCES CORPORATION

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)

8. DERIVATIVE AND HEDGING ACTIVITIES (Continued)

        At June 30, 2013 and December 31, 2012, the Company had the following open crude oil and natural gas derivative contracts:

			June 30, 2013
					Floors				Ceilings				Put Options Sold
Period	Instrument	Commodity	Volume in Mmbtu's/ Bbl's		Price / Price Range		Weighted Average Price		Price / Price Range		Weighted Average Price		Price / Price Range		Weighted Average Price
July 2013 - September 2013	Collars	Crude Oil		147,200	$	95.00	$	95.00	$	99.00 - 101.50	$	99.94
July 2013 - December 2013	Collars	Crude Oil		3,862,500		80.00 - 100.00		89.70		91.65 - 107.25		98.28
July 2013 - December 2013	Collars	Natural Gas		4,324,000		3.50 - 4.00		3.78		3.95 - 4.49		4.26
July 2013 - December 2013	Swaps	Crude Oil		180,000		97.60 - 105.55		102.18
July 2013 - December 2013	Swaps	Natural Gas		120,000		3.56		3.56
September 2013 - December 2013	Collars	Crude Oil		183,000		90.00		90.00		100.10		100.10
October 2013 - December 2013	Collars	Crude Oil		142,600		95.00		95.00		99.00 - 101.00		99.71
October 2013 - December 2013	Collars	Natural Gas		460,000		3.75		3.75		4.35		4.35
January 2014 - March 2014	Three-Way Collars	Crude Oil		144,000		95.00		95.00		98.60 - 109.50		100.03		70.00		70.00
January 2014 - June 2014	Collars	Crude Oil		724,000		90.00		90.00		96.50 - 99.50		98.00
April 2014 - June 2014	Three-Way Collars	Crude Oil		136,500		95.00		95.00		98.20 - 101.00		99.13		70.00		70.00
January 2014 - December 2014	Collars	Crude Oil		5,840,000		85.00 - 90.00		87.97		93.60 - 96.35		95.14
January 2014 - December 2014	Collars	Natural Gas		11,862,500		3.75 - 4.00		3.88		4.26 - 4.55		4.36
July 2014 - December 2014	Collars	Natural Gas		920,000		4.00		4.00		4.42		4.42
July 2014 - December 2014	Put	Crude Oil		184,000										90.00		90.00
January 2015 - December 2015	Collars	Natural Gas		6,387,500		4.00		4.00		4.55 - 4.85		4.68

			December 31, 2012
					Floors				Ceilings				Put Options Sold
Period	Instrument	Commodity	Volume in Mmbtu's/ Bbl's		Price / Price Range		Weighted Average Price		Price / Price Range		Weighted Average Price		Price / Price Range		Weighted Average Price
January 2013 - March 2013	Three-Way Collars	Crude Oil		130,500	$	95.00 - 100.00	$	95.34	$	105.50 - 109.50	$	101.36	$	70.00	$	70.00
January 2013 - March 2013	Basis Swaps	Natural Gas		225,000
January 2013 - March 2013	Collars	Crude Oil		31,500		95.00		95.00		101.50		101.50
January 2013 - March 2013	Swaps	Natural Gas		225,000		4.85		4.85
April 2013 - June 2013	Three-Way Collars	Crude Oil		120,575		95.00		95.00		99.50 - 100.60		99.77		70.00		70.00
April 2013 - June 2013	Collars	Crude Oil		29,575		95.00		95.00		100.60		100.60
July 2013 - September 2013	Collars	Crude Oil		147,200		95.00		95.00		99.00 - 101.50		99.94
October 2013 - December 2013	Collars	Crude Oil		142,600		95.00		95.00		99.00 - 101.00		99.71
January 2013 - December 2013	Collars	Crude Oil		5,201,250		80.00 - 100.00		89.04		91.65 - 107.25		98.06
January 2013 - December 2013	Collars	Natural Gas		1,825,000		3.75		3.75		4.26		4.26
January 2013 - December 2013	Swaps	Natural Gas		240,000		3.56		3.56
January 2013 - December 2013	Swaps	Crude Oil		360,000		97.60 - 105.55		102.18
February 2013 - December 2013	Collars	Crude Oil		250,500		100.00		100.00		104.15		104.15
April 2014 - June 2014	Three-Way Collars	Crude Oil		136,500		95.00		95.00		98.20 - 101.00		99.13		70.00		70.00
January 2014 - March 2014	Three-Way Collars	Crude Oil		144,000		95.00		95.00		98.60 - 109.50		100.03		70.00		70.00
January 2014 - December 2014	Collars	Crude Oil		2,190,000		85.00		85.00		95.10 - 96.35		95.92
January 2014 - December 2014	Collars	Natural Gas		1,825,000		3.75		3.75		4.26		4.26

        The Company presents the fair value of its derivative contracts at the gross amounts in the unaudited condensed consolidated balance sheets. The following table shows the potential effects of master netting arrangements on the fair value of the Company's derivative contracts at June 30, 2013

27

HALCÓN RESOURCES CORPORATION

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)

8. DERIVATIVE AND HEDGING ACTIVITIES (Continued)

and December 31, 2012 in accordance with ASU 2011-11 and ASU 2013-01, which were effective beginning January 1, 2013:

	Derivative Assets						Derivative Liabilities
Offsetting of Derivative Assets and Liabilities	June 30, 2013			December 31, 2012			June 30, 2013			December 31, 2012
	(In thousands)						(In thousands)
Gross amounts presented in the consolidated balance sheet	$	20,635		$	7,799		$	(5,198	)	$	(12,890	)
Amounts not offset in the consolidated balance sheet		(3,506	)		(4,118	)		3,414			3,899
Net amount	$	17,129		$	3,681		$	(1,784	)	$	(8,991	)

        The Company enters into an International Swap Dealers Association Master Agreement (ISDA) with each counterparty prior to a derivative contract with such counterparty. The ISDA is a standard contract that governs all derivative contracts entered into between the Company and the respective counterparty. The ISDA allows for offsetting of amounts payable or receivable between the Company and the counterparty, at the election of both parties, for transactions that occur on the same date and in the same currency.

9. ASSET RETIREMENT OBLIGATIONS

        The Company records an asset retirement obligation (ARO) when it can reasonably estimate the fair value of an obligation to perform site reclamation, dismantle facilities or plug and abandon costs. For gas gathering systems and equipment, the Company records an ARO when the system is placed in service and it can reasonably estimate the fair value of an obligation to perform site reclamation and other necessary work when it is required. The Company records the ARO liability on the unaudited condensed consolidated balance sheets and capitalizes a portion of the cost in "Oil and natural gas properties" or "Other operating property and equipment" during the period in which the obligation is incurred. The Company records the accretion of its ARO liabilities in "Depletion, depreciation and accretion" expense in the unaudited condensed consolidated statements of operations. The additional capitalized costs are depreciated on a unit-of-production basis or straight-line basis.

        The Company recorded the following activity related to its ARO liability for the six months ended June 30, 2013 (in thousands, inclusive of the current portion):

Liability for asset retirement obligations as of December 31, 2012	$	75,132
Liabilities settled and divested		(265	)
Additions		5,037
Acquisitions		1,055
Accretion expense		1,825
Revisions in estimated cash flows		(433	)
Liability for asset retirement obligations as of June 30, 2013	$	82,351

28

HALCÓN RESOURCES CORPORATION

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)

10. COMMITMENTS AND CONTINGENCIES

Commitments

        The Company leases corporate office space in Houston and Plano, Texas; Tulsa, Oklahoma; Denver, Colorado; and Williston, North Dakota as well as a number of other field office locations. Rent expense was approximately $4.4 million and $1.2 million for the six months ended June 30, 2013 and 2012, respectively. In addition, the Company has commitments for certain equipment under long-term operating lease agreements, namely drilling rigs as well as pipeline and well equipment, with various expiration dates through 2015. Early termination of the drilling rig commitments would result in termination penalties approximating $42.6 million, which would be in lieu of the remaining $68.9 million of drilling rig commitments as of June 30, 2013. As of June 30, 2013, the amount of commitments under office and equipment lease agreements is consistent with the levels at December 31, 2012, as disclosed in the Company's Annual Report on Form 10-K, approximating $66.7 million in the aggregate, and containing various expiration dates through 2024.

Contingencies

        From time to time, the Company may be a plaintiff or defendant in a pending or threatened legal proceeding arising in the normal course of its business. While the outcome and impact of currently pending legal proceedings cannot be determined, the Company's management and legal counsel believe that the resolution of these proceedings through settlement or adverse judgment will not have a material effect on the Company's unaudited condensed consolidated operating results, financial position or cash flows.

11. PREFERRED STOCK AND STOCKHOLDERS' EQUITY

Preferred Stock and Non-Cash Preferred Stock Dividend

        On February 29, 2012 (the Commitment Date), the Company entered into definitive agreements with a group of certain institutional and selected other accredited investors (collectively, the investors) to sell, in a private offering, 4,444.4511 shares of 8% Automatically Convertible Preferred Stock, par value $0.0001 per share (the Preferred Stock), each share of which was convertible into 10,000 shares of common stock. Also on February 29, 2012, the Company received an executed written consent (the Consent) in lieu of a stockholders' meeting authorizing and approving the conversion of the Preferred Stock into common stock. On March 2, 2012, the Company filed a Certificate of Designation, Preferences, Rights and Limitations of the Preferred Stock (the Certificate of Designation) with the Delaware Secretary of State which stated the conversion was to occur on the twentieth day after the mailing of a definitive information statement to stockholders. On March 5, 2012, the Company issued the Preferred Stock to the investors at $90,000 per share. Gross proceeds from the offering were approximately $400.0 million, or $9.00 per share of common stock, before offering expenses. The Company incurred placement agent fees of $14.0 million and associated expenses of approximately $0.5 million in connection with this offering. On March 28, 2012, the Company mailed a definitive information statement to its common stockholders notifying them that Halcón's majority stockholder had consented to the issuance of common stock, par value $0.0001, upon the conversion of the Preferred Stock. The Preferred Stock automatically converted into 44.4 million shares of common stock on April 17, 2012 in accordance with the terms of the Certificate of Designation. No cash dividends were paid on the Preferred Stock since pursuant to the terms of the Certificate of Designation of the Preferred Stock, conversion occurred prior to May 31, 2012. On November 30, 2012, the Company filed

29

HALCÓN RESOURCES CORPORATION

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)

11. PREFERRED STOCK AND STOCKHOLDERS' EQUITY (Continued)

a Certificate of Elimination with the Delaware Secretary of State eliminating all provisions of the Certificate of Designation of the Preferred Stock.

        In accordance with ASC 470, Debt (ASC 470), the Company determined that the conversion feature in the Preferred Stock represented a beneficial conversion feature. The fair value of the common stock of $10.99 per share on the Commitment Date was greater than the conversion price of $9.00 per share of common stock, representing a beneficial conversion feature of $1.99 per share of common stock, or $88.4 million in aggregate. Under ASC 470, $88.4 million (the intrinsic value of the beneficial conversion feature) of the proceeds received from the issuance of the Preferred Stock was allocated to additional paid-in capital, creating a discount on the Preferred Stock (the Discount). The Discount resulting from the allocation of value to the beneficial conversion feature was required to be amortized on a non-cash basis over the approximate 71-month period between the issuance date and the required redemption date of February 9, 2018, or fully amortized upon an accelerated date of redemption or conversion, and recorded as a preferred dividend. As a result, approximately $1.1 million of the Discount was amortized and a non-cash preferred dividend was recorded in the first quarter of 2012 and due to the conversion date occurring on April 17, 2012, the remaining $87.3 million of Discount amortization was accelerated to the conversion date and was fully amortized in the second quarter of 2012 as per the guidance of ASC 470. The Discount amortization is reflected as non-cash preferred dividend in the unaudited condensed consolidated statements of operations. In accordance with the guidance in ASC 480, the preferred dividend was charged against additional paid-in capital since no retained earnings were available.

        On December 6, 2012, the Company completed the Williston Basin Acquisition for a total adjusted purchase price of approximately $1.5 billion, consisting of approximately $785.8 million in cash and approximately $695.2 million in newly issued shares of Halcón preferred stock that automatically converted into 108.8 million shares of Halcón common stock (equivalent to a conversion price of approximately $7.45 per share of Halcón common stock), following stockholder approval on January 17, 2013 of such conversion and an amendment to Halcón's certificate of incorporation to increase the number of shares of common stock that Halcón is authorized to issue. The shares of preferred stock were issued to the Petro-Hunt Parties in a private placement pursuant to the exemptions from registration under Section 4(2) of the Securities Act of 1933, as amended.

        On January 17, 2013, the Company received the results from the special stockholders' meeting authorizing and approving the issuance of 108.8 million shares of common stock upon the conversion of the convertible preferred stock issued to the Petro-Hunt Parties. Following the approval by the stockholders, on January 18, 2013, each outstanding share of the Company's preferred stock converted into 10,000 shares of its common stock at an effective conversion price of approximately $7.45 per share. No proceeds were received by the Company upon conversion of the preferred stock. No cash dividends were paid on the preferred stock since pursuant to the terms of the Certificate of Designation of the preferred stock, conversion occurred prior to April 6, 2013. On June 13, 2013, the Company filed a Certificate of Elimination with the Delaware Secretary of State eliminating all provisions of the Certificate of Designation.

5.75% Series A Convertible Perpetual Preferred Stock

        On June 18, 2013, the Company completed its offering of 345,000 shares of its 5.75% Series A Convertible Perpetual Preferred Stock (the Series A Preferred Stock) at a public offering price of

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NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)

11. PREFERRED STOCK AND STOCKHOLDERS' EQUITY (Continued)

$1,000 per share (the Liquidation Preference). The Company filed a Certificate of Designations, Preferences, Rights and Limitations of 5.75% Series A Convertible Preferred Stock on June 17, 2013 (the Series A Designation). The net proceeds to the Company from the offering of the Series A Preferred Stock were approximately $335.5 million, after deducting the underwriting discount and offering expenses. The Company used the net proceeds from the offering to repay a portion of the outstanding borrowings under its Senior Credit Agreement.

        Holders of the Series A Preferred Stock are entitled to receive, when, as and if declared by the Company's Board of Directors, cumulative dividends at the rate of 5.75% per annum (the dividend rate) on the Liquidation Preference per share of the Series A Preferred Stock, payable quarterly in arrears on each dividend payment date. Dividends may be paid in cash or, where freely transferable by any non-affiliate recipient thereof, in common stock of the Company or a combination thereof, and are payable on March 1, June 1, September 1 and December 1 of each year, commencing on September 1, 2013. As of June 30, 2013, cumulative, undeclared dividends on the Series A Preferred Stock amounted to approximately $0.7 million.

        The Series A Preferred Stock has no maturity date, is not redeemable by the Company at any time, and will remain outstanding unless converted by the holders or mandatorily converted by the Company as described below.

        Each share of Series A Preferred Stock is convertible, at the holder's option at any time, initially into approximately 162.4431 shares of common stock of the Company (which is equivalent to an initial conversion price of approximately $6.16 per share), subject to specified adjustments as set forth in the Series A Designation. Based on the initial conversion rate, approximately 56.0 million shares of common stock of the Company would be issuable upon conversion of all the shares of Series A Preferred Stock.

        On or after June 6, 2018, the Company may, at its option, give notice of its election to cause all outstanding shares of the Series A Preferred Stock to be automatically converted into shares of common stock of the Company at the conversion rate (as defined in the Preliminary Prospectus Supplement), if the closing sale price of the Company's common stock equals or exceeds 150% of the conversion price for at least 20 trading days in a period of 30 consecutive trading days.

        If the Company undergoes a fundamental change (as defined in the Preliminary Prospectus Supplement) and a holder converts its shares of the Series A Preferred Stock at any time beginning at the opening of business on the trading day immediately following the effective date of such fundamental change and ending at the close of business on the 30th trading day immediately following such effective date, the holder will receive, for each share of the Series A Preferred Stock surrendered for conversion, a number of shares of common stock of the Company equal to the greater of: (1) the sum of (i) the conversion rate and (ii) the make-whole premium, if any, as described in the Series A Designation; and (2) the conversion rate which will be increased to equal (i) the sum of the $1,000 liquidation preference plus all accumulated and unpaid dividends to, but excluding, the settlement date for such conversion, divided by (ii) the average of the closing sale prices of the Company's common stock for the five consecutive trading days ending on the third business day prior to such settlement date; provided that the prevailing conversion rate as adjusted pursuant to this will not exceed 292.3977 shares of common stock of the Company per share of the Series A Preferred Stock (subject to adjustment in the same manner as the conversion rate).

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11. PREFERRED STOCK AND STOCKHOLDERS' EQUITY (Continued)

        Except as required by Delaware law, holders of the Series A Preferred Stock will have no voting rights unless dividends are in arrears and unpaid for six or more quarterly periods. Until such arrearage is paid in full, the holders (voting as a single class with the holders of any other preferred shares having similar voting rights) will be entitled to elect two additional directors and the number of directors on the Company's Board of Directors will increase by that same number.

Common Stock

        On February 8, 2012 pursuant to the closing of the Recapitalization described in Note 2, "Recapitalization," the Company issued 73.3 million shares of the Company's common stock for a purchase price of $275.0 million. Costs incurred of $4.0 million were netted against the proceeds of the common stock and recorded accordingly. In addition, the Company amended its certificate of incorporation to increase the Company's authorized shares of common stock from 33.3 million shares to 336.7 million shares.

        In early August 2012, in connection with the Merger and the East Texas Acquisition, the Company issued 51.3 million and 20.8 million shares of common stock, respectively. The shares were issued at closing of the transactions as a portion of the consideration of the purchase price. See Note 4, "Acquisitions," for additional discussion on the issuance of common stock in connection with these transactions.

        On December 6, 2012, the Company completed the private placement of 41.9 million shares of common stock, par value $0.0001 per share, to CPP Investment Board PMI-2 Inc. (CPPIB), for gross proceeds of approximately $300.0 million, or $7.16 per share of common stock (the CPPIB Transaction). The net proceeds to the Company were $294.0 million following the payment of a $6.0 million capital commitment payment to CPPIB upon closing of the transaction. The shares of Halcón common stock were issued to CPPIB in a private placement pursuant to the exemptions from registration provided under Section 4(2) of the Securities Act.

        On January 17, 2013, with stockholder approval, the Company filed a Certificate of Amendment of the Amended and Restated Certificate of Incorporation with the Delaware Secretary of State to increase its authorized common stock by approximately 333.3 million shares for a total of 670.0 million authorized shares of common stock.

Warrants

        In February 2012, in conjunction with the issuance of the 2017 Notes, the Company issued the February 2012 Warrants to purchase 36.7 million shares of the Company's common stock at an exercise price of $4.50 per share of common stock pursuant to the Recapitalization described in Note 2, "Recapitalization." The Company allocated $43.6 million to the February 2012 Warrants which is reflected in additional paid-in capital in stockholders' equity, net of $0.6 million in issuance costs. The February 2012 Warrants entitle the holders to exercise the warrants in whole or in part at any time prior to the expiration date of February 8, 2017.

        In August 2012, as part of the Merger, the Company assumed outstanding GeoResources stock warrants. At the date of the Merger 0.6 million warrants were outstanding and converted to 1.2 million Halcón warrants (the August 2012 Warrants). Each GeoResources warrant was converted into an August 2012 Warrant to acquire one share of Halcón common stock (Share Portion) at an exercise

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HALCÓN RESOURCES CORPORATION

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)

11. PREFERRED STOCK AND STOCKHOLDERS' EQUITY (Continued)

price of $8.40 per share of common stock and the right to receive $20 in cash per equivalent assumed share (Cash Portion) at an exercise price of $0.82 per $1.00 received. The August 2012 Warrants contain substantially the same terms of the original GeoResources warrants with adjustments to the exercise price and addition of the Cash Portion to reflect the impact of the consideration per share from the Merger. These adjustments convert the terms to fundamentally equal what the warrant holders would have received had the warrants been exercised immediately prior to the close of the Merger. Under the terms of the August 2012 Warrants, the warrant holder must exercise the Share Portion and the Cash Portion in tandem. The August 2012 Warrants expired on June 9, 2013. The August 2012 Warrants were reflected as a current liability in the unaudited condensed consolidated balance sheets at December 31, 2012 and were recorded at fair value. During the three months ended June 30, 2013, the Company recorded a gain of $1.6 million for the expiration of the warrants. Changes in fair value and the gain upon expiration were recognized in "Interest expense and other" in the unaudited condensed consolidated statements of operations.

Incentive Plan

        On May 8, 2006, the Company's stockholders first approved its 2006 Long-Term Incentive Plan (the Plan). The Company reserved a maximum of 0.8 million shares of its common stock for issuances under the Plan. On May 8, 2008, the Plan was amended to increase the maximum authorized number of shares to be issued under the Plan from 0.8 million to 2.0 million. On May 3, 2010, the Plan was amended to increase the maximum authorized number of shares to be issued under the Plan from 2.0 million to 2.5 million. On February 8, 2012, as part of the Recapitalization described in Note 2, "Recapitalization," the Plan was amended to increase the maximum authorized number of shares to be issued under the Plan from 2.5 million to 3.7 million. On May 17, 2012, shareholders approved an amendment and restatement of the Plan to (i) increase the maximum number of shares to be issued under the Plan from 3.7 million to 11.5 million; (ii) extend the effectiveness of the Plan for ten years from the date of approval; and (iii) amend various other provisions of the Plan. On May 23, 2013, shareholders approved an increase in authorized shares under the Plan from 11.5 million to 41.5 million. As of June 30, 2013 and December 31, 2012, a maximum of 25.5 million and 4.4 million shares of common stock, respectively, remained reserved for issuance under the Plan.

        The Company accounts for share-based payment accruals under authoritative guidance on stock compensation, as set forth in ASC Topic 718. The guidance requires all share-based payments to employees and directors, including grants of stock options and restricted stock, to be recognized in the financial statements based on their fair values.

        For the three and six months ended June 30, 2013, the Company recognized $4.6 million and $7.0 million, respectively, of share-based compensation expense as a component of "General and administrative" on the unaudited condensed consolidated statements of operations. For the three and six months ended June 30, 2012, the Company recognized $0.5 million and $4.6 million, respectively, of share-based compensation expense.

Stock Options

        During the six months ended June 30, 2013, the Company granted stock options under the Plan covering 6.1 million shares of common stock to employees of the Company. The stock options have exercise prices ranging from $5.21 to $8.23 with a weighted average exercise price of $7.10. These

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NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)

11. PREFERRED STOCK AND STOCKHOLDERS' EQUITY (Continued)

awards typically vest over a three year period at a rate of one-third on the annual anniversary date of the grant and expire ten years from the grant date. At June 30, 2013, the Company had $19.5 million of unrecognized compensation expense related to non-vested stock options to be recognized over a weighted-average period of 1.5 years.

        During the six months ended June 30, 2012, the Company granted stock options covering approximately 1.3 million shares of common stock to employees of the Company. The stock options have exercise prices ranging from $8.73 to $11.55 with a weighted average price of $10.11. These awards vest over a three year period at a rate of one-third on the annual anniversary date of the grant and expire ten years from the grant date. At June 30, 2012, the Company had $4.8 million of unrecognized compensation expense related to non-vested stock options to be recognized over a weighted-average period of 1.8 years.

Restricted Stock

        During the six months ended June 30, 2013, the Company granted 3.2 million shares of restricted stock under the Plan to directors and employees of the Company. These restricted shares were granted at prices ranging from $5.15 to $7.65 with a weighted average price of $6.92. Employee shares vest over a three year period at a rate of one-third on the annual anniversary date of the grant, and the non-employee directors' shares vest six-months from the date of grant. At June 30, 2013, the Company had $18.1 million of unrecognized compensation expense related to non-vested restricted stock awards to be recognized over a weighted-average period of 1.5 years.

        During the six months ended June 30, 2012, the Company granted 0.2 million shares of restricted stock under the Plan to directors and employees of the Company. These restricted shares were granted at a price $10.13. Employee shares vest over a three year period at a rate of one-third on the annual anniversary date of the grant, and the non-employee directors' shares vest six-months from the date of grant. At June 30, 2012, the Company had $2.0 million of unrecognized compensation expense related to non-vested restricted stock awards to be recognized over a weighted-average period of 2.0 years.

        During the six months ended June 30, 2012, the Company incurred compensation expense of $2.6 million primarily from the accelerated vesting of all unvested employee restricted stock shares due to the change in control in the Company resulting from the Recapitalization as described in Note 2, "Recapitalization."

Stock Appreciation Rights

        During February 2012, the Company accelerated vesting and exercise of all unvested stock appreciation rights under the Plan (SARs) that were granted in May 2011, due to the change in control of the Company resulting from the Recapitalization described in Note 2, "Recapitalization." The Company settled the SARs in cash, resulting in $2.2 million of share-based compensation expense recognized for the six months ended June 30, 2012. The realized compensation expense was partially offset by the reversal of $0.8 million of unrealized losses recorded at December 31, 2011.

Treasury Stock

        As discussed above, during the six months ended June 30, 2013, the Company granted 3.2 million shares of restricted stock under the Plan to directors and employees of the Company of which

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HALCÓN RESOURCES CORPORATION

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)

11. PREFERRED STOCK AND STOCKHOLDERS' EQUITY (Continued)

1.2 million shares were issued out of treasury stock. In addition, the Company retired 0.4 million shares from treasury stock representing shares that were repurchased for taxes tendered upon vesting of stock based compensation awards in prior years. As of June 30, 2013, the Company had no issued shares held in treasury.

12. INCOME TAXES

        Under guidance contained in Topic 740 of the ASC, deferred taxes are determined by applying the provisions of enacted tax laws and rates for the jurisdictions in which the Company operates to the estimated future tax effects of the differences between the tax basis of assets and liabilities and their reported amounts in the Company's financial statements. A valuation allowance is established to reduce deferred tax assets if it is more likely than not that the related tax benefits will not be realized.

        The Company estimates its annual effective income tax rate in recording its quarterly provision for income taxes in the various jurisdictions in which the Company operates. Statutory tax rate changes and other significant or unusual items are recognized as discrete items in the quarter in which they occur. At June 30, 2013 and December 31, 2012, the Company analyzed and made no adjustment to the valuation allowance.

        As of June 30, 2013, the Company has calculated an estimated annual tax rate of 38.3%. The estimated annual rate differs from the statutory federal income tax rate primarily due to the estimate of state income taxes for the period and nondeductible interest expense on the 2017 Note issued as part of the Recapitalization in February 2012. Based on the estimated effective annual tax rate, the Company recorded a tax provision of $26.4 million on pre-tax income of $69.0 million for the six months ended June 30, 2013. For the six months ended June 30, 2012, the Company recorded a tax provision of $0.2 million on a pre-tax loss of $25.5 million. The effective tax rate for the six months ending June 30, 2013 was 38.3% compared to 0.8% for the six months ending June 30, 2012. The change in effective tax rate is primarily due to the increase in pre-tax income in the current year and the impact of federal income tax limitations on the deductibility of interest expense on the 2017 Note issued as part of the Recapitalization in February 2012.

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HALCÓN RESOURCES CORPORATION

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)

13. EARNINGS PER COMMON SHARE

        The following represents the calculation of earnings (loss) per share (in thousands, except per share amounts):

	Three Months Ended June 30,					Six Months Ended June 30,
	2013		2012			2013		2012
	(In thousands, except per share amounts)
Basic:
Net income (loss) available to common stockholders	$	36,372	$	(79,684	)	$	41,837	$	(114,108	)
Weighted average basic number of common shares outstanding		366,712		136,066			356,482		102,441
Basic net income (loss) per share of common stock	$	0.10	$	(0.59	)	$	0.12	$	(1.11	)
Diluted:
Net income (loss) available to common stockholders	$	36,372	$	(79,684	)	$	41,837	$	(114,108	)
Interest on convertible debt, net		974		—			1,974		—
Net income (loss) available to common stockholders after assumed conversions	$	37,346	$	(79,684	)	$	43,811	$	(114,108	)
Weighted average basic number of common shares outstanding		366,712		136,066			356,482		102,441
Common stock equivalent shares representing shares issuable upon exercise of stock options		Anti-dilutive		Anti-dilutive			Anti-dilutive		Anti-dilutive
Common stock equivalent shares representing shares issuable upon exercise of Febuary 2012 Warrants		9,954		Anti-dilutive			12,183		Anti-dilutive
Common stock equivalent shares representing shares issuable upon exercise of August 2012 Warrants		Anti-dilutive		—			Anti-dilutive		—
Common stock equivalent shares representing shares included upon vesting of restricted shares		108		Anti-dilutive			682		Anti-dilutive
Common stock equivalent shares representing shares issuable upon conversion of 2017 Notes		64,371		Anti-dilutive			32,185		Anti-dilutive
Common stock equivalent shares representing shares issuable upon conversion of preferred stock		—		—			10,880		Anti-dilutive
Common stock equivalent shares representing shares issuable upon conversion of Series A Preferred Stock		Anti-dilutive		—			Anti-dilutive		—
Weighted average diluted number of common shares outstanding		441,145		136,066			412,412		102,441
Diluted net income (loss) per share of common stock	$	0.08	$	(0.59	)	$	0.11	$	(1.11	)

        Common stock equivalents, including stock options, warrants, restricted shares, convertible debt, and preferred stock, totaling 17.1 million and 43.9 million shares for the three and six months ended

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NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)

13. EARNINGS PER COMMON SHARE (Continued)

June 30, 2013, respectively, were not included in the computation of diluted earnings per share of common stock because the effect would have been anti-dilutive. Common stock equivalents of stock options, preferred stock, warrants and the 2017 Note totaling 89.4 million and 75.4 million shares for the three and six months ended June 30, 2012, respectively, were not included in the computations of diluted earnings per share of common stock because the effect would have been anti-dilutive due to the net losses.

14. ADDITIONAL FINANCIAL STATEMENT INFORMATION

        Certain balance sheet amounts are comprised of the following (in thousands):

	June 30, 2013		December 31, 2012
	(In thousands)
Accounts receivable:
Oil, natural gas and natural gas liquids revenues	$	126,193	$	143,794
Joint interest accounts		133,334		113,671
Affiliated partnerships		386		475
Other		4,303		4,869
	$	264,216	$	262,809
Prepaids and other:
Prepaids	$	6,712	$	3,690
Other		6,256		3,001
	$	12,968	$	6,691
Other noncurrent assets:
Deposits for acquisitions of oil and natural gas properties	$	36,855	$	—
Other		277		934
	$	37,132	$	934
Accounts payable and accrued liabilities:
Trade payables	$	127,324	$	147,679
Accrued oil and natural gas capital costs		358,973		282,245
Revenues and royalties payable		133,736		91,761
Accrued interest expense		52,164		45,201
Accrued income taxes payable		4		130
Accrued employee compensation		13,328		12,321
Drilling advances from partners		20,205		8,840
Accounts payable to affiliated partnerships		83		822
Other		—		1,552
	$	705,817	$	590,551

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HALCÓN RESOURCES CORPORATION

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)

15. SUBSEQUENT EVENT

        On July 19, 2013, the Company completed the sale of its interest in Eagle Ford assets in Fayette and Gonzales Counties, Texas, previously acquired as part of the Merger, to private buyers for estimated proceeds of approximately $144 million, before post-closing adjustments. The transaction had an effective date of January 1, 2013. Proceeds from the sale will be recorded as a reduction to the carrying value of the Company's full cost pool with no gain or loss recorded. Upon the closing of this transaction, the borrowing base under the Senior Credit Agreement was reduced from $850.0 million to $810.0 million.

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Item 2.    Management's Discussion and Analysis of Financial Condition and Results of Operations

        The following discussion is intended to assist in understanding our results of operations for the three and six months ended June 30, 2013 and 2012 and should be read in conjunction with our unaudited condensed consolidated financial statements and the notes thereto included in this Quarterly Report on Form 10-Q and with the consolidated financial statements, notes and management's discussion and analysis included in our Annual Report on Form 10-K for the year ended December 31, 2012.

        Statements in this discussion may be forward-looking. These forward-looking statements involve risks and uncertainties, including those discussed below, which could cause actual results to differ from those expressed.

Overview

        We are an independent energy company focused on the acquisition, production, exploration and development of onshore liquids-rich oil and natural gas assets in the United States. We were incorporated in Delaware on February 5, 2004 and were recapitalized on February 8, 2012. Historically, our producing properties have been located in basins with long histories of oil and natural gas operations. During 2012, we focused our efforts on the acquisition of unevaluated leasehold and producing properties in selected prospect areas. We now have an extensive drilling inventory in multiple basins that we believe allows for multiple years of profitable production growth and provides us with broad flexibility to direct our capital resources to projects with the greatest potential returns.

        Our oil and natural gas assets consist of a combination of undeveloped acreage positions in unconventional liquids-rich basins/fields and mature liquids-weighted reserves and production in more conventional basins/fields. We have mature oil and natural gas reserves located primarily in Texas, North Dakota, Louisiana, Oklahoma and Montana. We have acquired acreage, and may acquire additional acreage, in the Bakken / Three Forks formations in North Dakota and Montana, the Eagle Ford formation in East Texas, the Utica / Point Pleasant formations in Ohio and Pennsylvania, and the Woodbine formation in East Texas.

        Our average daily oil and natural gas production increased 593% in the first six months of 2013 compared to the same period in the prior year. During the first six months of 2013, we averaged 27,602 barrels of oil equivalent (Boe) per day compared to average daily production of 3,984 Boe per day during the first six months of 2012. The increase in production compared to the prior year period was driven primarily by the acquisitions of GeoResources, the East Texas Assets and the Williston Basin Assets. The acquisitions of GeoResources, the East Texas Assets and the Williston Basin Assets combined to contribute approximately 23,600 Boe per day of the increase. During the first six months of 2013, we participated in the drilling of 159 gross (68.3 net) wells of which 157 gross (66.3 net) wells were completed and capable of production, and 2 gross (2.0 net) wells were dry holes.

        Our 2013 budget for drilling and completion capital expenditures has been increased from approximately $1.2 billion to approximately $1.4 billion. While this amount represents the vast majority of our expected capital expenditures in 2013, we have and will continue to incur additional capital expenditures associated with ongoing leasing efforts, transportation, infrastructure and seismic and other expenditures. Our drilling and completion budget for 2013 is based on our current view of market conditions and current business plans, and is subject to change.

Recent Developments

Issuance of 5.75% Series A Convertible Perpetual Preferred Stock

        On June 18, 2013, we completed our offering of 345,000 shares of 5.75% Series A Convertible Perpetual Preferred Stock (the Series A Preferred Stock) at a public offering price of $1,000 per share.

39

The net proceeds to us from the offering of the Series A Preferred Stock were approximately $335.5 million, after deducting the underwriting discount and offering expenses. We used the net proceeds from the offering to repay a portion of the outstanding borrowings under our Senior Credit Agreement. Holders of the Series A Preferred Stock are entitled to receive, when, as and if declared by our Board of Directors, cumulative dividends at the rate of 5.75% per annum (the dividend rate) on the $1,000 liquidation preference per share of the Series A Preferred Stock, payable quarterly in arrears on each dividend payment date. Dividends may be paid in cash or, where freely transferable by any non-affiliate recipient thereof, in shares of common stock or a combination thereof, and are payable on March 1, June 1, September 1 and December 1 of each year, commencing on September 1, 2013. See Item 1. Condensed Consolidated Financial Statements (Unaudited)—Note 11, "Preferred Stock and Stockholders' Equity" for additional information on the Series A Preferred Stock.

Amendments to the Senior Credit Agreement and Borrowing Base

        Upon the closing of the Eagle Ford divestiture on July 19, 2013, the borrowing base under the Senior Credit Agreement was reduced from $850.0 million to $810.0 million.

        On June 11, 2013, we entered into the Fifth Amendment to the Senior Credit Agreement (the Fifth Amendment). The Fifth Amendment provides, among other things, for us to pay cash dividends to holders of our preferred capital stock.

        On May 8, 2013, we entered into the Fourth Amendment to our Senior Credit Agreement (the Fourth Amendment). The Fourth Amendment provides for EBITDA (as defined in the Credit Facility) to be annualized for the balance of calendar year 2013 for purposes of measuring compliance with the interest coverage test. Specifically, (i) for the fiscal quarter ended June 30, 2013, the Interest Coverage Ratio shall be calculated by utilizing EBITDA for the three month period then ended multiplied by 4; (ii) for the fiscal quarter ended September 30, 2013, the Interest Coverage Ratio shall be calculated by utilizing EBITDA for the six month period then ended multiplied by 2; and (iii) for the fiscal quarter ended December 31, 2013, the Interest Coverage Ratio shall be calculated by utilizing EBITDA for the nine month period then ended multiplied by 4/3.

        On April 26, 2013, we entered into the Third Amendment to our Senior Credit Agreement (the Third Amendment) by and among us, as borrower, JPMorgan Chase Bank, N.A., as administrative agent, and the other lenders signatory thereto, which amends the Senior Credit Agreement in order to provide, among other things, additional flexibility under certain affirmative and negative covenants.

        On January 25, 2013, we entered into the Second Amendment to our Senior Credit Agreement (the Second Amendment) by and among us, as borrower, JPMorgan Chase Bank, N.A., as administrative agent, and the other lenders signatory thereto. The Second Amendment amends the Senior Credit Agreement with respect to our ability to enter into certain commodity hedging agreements.

        See Item 1. Condensed Consolidated Financial Statements (Unaudited)—Note 6, "Long-Term Debt" for additional information on the amendments to our Senior Credit Agreement.

Issuance of Additional 2021 Notes

        On January 14, 2013, we issued an additional $600 million aggregate principal amount of our 8.875% senior notes due 2021 at a price to the initial purchasers of 105% of par. The net proceeds from the sale of the additional 2021 Notes of approximately $619.5 million (after the initial purchasers' premiums, commissions and offering expenses) were used to repay all of the outstanding borrowings under our Senior Credit Agreement and for general corporate purposes, including funding a portion of our 2013 capital expenditures program. These notes were issued as "additional notes" under the indenture governing our 2021 Notes and pursuant to which we had previously issued $750 million

40

aggregate principal amount of 2021 Notes in November 2012, and under the indenture are treated as a single series with substantially identical terms as the 2021 Notes previously issued. See Item 1. Condensed Consolidated Financial Statements (Unaudited)—Note 6, "Long-Term Debt" for additional information on the 2021 Notes.

Capital Resources and Liquidity

        During the first half of 2013, we shifted the focus of our capital program from acquiring leasehold and producing properties to drilling and completion activities. We are currently focused on developing our core areas which include the Bakken / Three Forks formations in North Dakota, the Eagle Ford formation in East Texas, Utica / Point Pleasant formations in Ohio and Pennsylvania, and the Woodbine formation in East Texas. In addition to our ongoing drilling and completion activities we continue to acquire leasehold in our core areas and select other exploratory areas we believe are prospective for oil and liquids-rich hydrocarbons. During the first six months of 2013, we invested $1.0 billion in oil and natural gas capital expenditures.

        Our near-term capital spending requirements are expected to be funded with cash flows from operations, proceeds from potential non-core asset dispositions, proceeds from potential capital market transactions and borrowings under our Senior Credit Agreement, which has a current borrowing base of $810.0 million. Our borrowing base is redetermined on a semi-annual basis (with us and the lenders each having the right to one interim unscheduled redetermination between any two consecutive semi-annual redeterminations) and adjusted based on our oil and natural gas properties, reserves, other indebtedness and other relevant factors. Our ability to utilize the full amount of our borrowing capacity is influenced by a variety of factors, including redeterminations of our borrowing base, and covenants under our Senior Credit Agreement and our senior unsecured debt indentures. Our Senior Credit Agreement contains customary financial and other covenants, including minimum working capital levels (the ratio of current assets plus the unused commitment under the Senior Credit Agreement to current liabilities) of not less than 1.0 to 1.0 and minimum coverage of interest expenses (as defined in the Senior Credit Agreement) of not less than 2.5 to 1.0. We are subject to additional covenants limiting dividends and other restricted payments, transactions with affiliates, incurrence of debt, changes of control, asset sales, and liens on properties. Additionally, the indentures governing our senior unsecured debt contain covenants limiting our ability to incur additional indebtedness, including borrowings under our Senior Credit Agreement, unless we meet one of two alternative tests. The first test, the fixed charge coverage ratio test, applies to all indebtedness and requires that after giving effect to the incurrence of additional debt the ratio of our adjusted consolidated EBITDA (as defined in our indentures) to our adjusted consolidated interest expense over the trailing four fiscal quarters will be at least 2.0 to 1.0. The second test allows us to incur additional indebtedness, beyond the limitations of the fixed charge coverage ratio test, as long as this additional debt is incurred under Credit Facilities (as defined in our indentures) and the amount of such additional indebtedness is not more than the greater of a fixed sum of $750 million or 30% of our adjusted consolidated net tangible assets (as defined in our indentures), which is determined primarily using discounted future net revenues from proved oil and natural gas reserves as of the end of each year. At June 30, 2013, we had $343.0 million of indebtedness outstanding, $1.2 million of letters of credit outstanding and $505.8 million of borrowing capacity available under the Senior Credit Agreement.

        We strive to maintain financial flexibility while continuing our aggressive drilling plans and evaluating potential acquisitions, and will therefore likely continue to access capital markets (if on acceptable terms) as necessary to, among other things, maintain substantial borrowing capacity under our Senior Credit Agreement, facilitate drilling on our large undeveloped acreage position and permit us to selectively expand our acreage position and infrastructure projects while sustaining sufficient operating cash levels. Our ability to complete future debt and equity offerings and maintain or increase our borrowing base is subject to a number of variables, including our level of oil and natural gas

41

production, reserves and commodity prices, as well as various economic and market conditions that have historically affected the oil and natural gas industry. If oil and natural gas prices decline for a sustained period of time, our ability to fund our capital expenditures, complete acquisitions, reduce debt, and meet our financial obligations may be materially impacted.

        Our future capital resources and liquidity depend, in part, on our success in developing our leasehold interests, growing reserves and production and finding additional reserves. Cash is required to fund capital expenditures necessary to offset inherent declines in our production and proven reserves, which is typical in the capital-intensive oil and natural gas industry. We therefore continuously monitor our liquidity and the capital markets and evaluate our development plans in light of a variety of factors, including, but not limited to, our cash flows, capital resources, acquisition opportunities and drilling successes.

Cash Flow

        Our primary source of cash for the six months ended June 30, 2013 and 2012 was from financing activities. In the first six months of 2013, proceeds from the additional 2021 Notes and the Series A Preferred Stock issuance were the primary drivers of the net cash provided by financing activities. The increase in cash received from operations, coupled with the cash from financing activities, were offset by cash used in investing activities to fund our drilling program and acquire additional leasehold interests. Operating cash flow fluctuations were substantially driven by the 593% increase in production volumes as compared to the six months ended June 30, 2012 and, to a lesser extent, higher commodity prices. Fluctuation in commodity prices and our overall cash flow may result in an increase or decrease in our future capital expenditures. Prices for oil and natural gas have historically been subject to seasonal fluctuations characterized by peak demand and higher prices in the winter heating season; however, the impact of other risks and uncertainties have influenced prices throughout recent years. See Results of Operations below for a review of the impact of prices and volumes on sales.

        Net increase (decrease) in cash is summarized as follows (in thousands):

	Six Months Ended June 30,
	2013			2012
	(In thousands)
Cash flows provided by (used in) operating activities	$	229,890		$	(2,708	)
Cash flows provided by (used in) investing activities		(1,165,750	)		(500,809	)
Cash flows provided by (used in) financing activities		936,415			722,676
Net increase (decrease) in cash	$	555		$	219,159

        Operating Activities.    Net cash provided by operating activities for the six months ended June 30, 2013 was $229.9 million as compared to cash used in operating activities for the six months ended June 30, 2012 of $2.7 million.

        The $229.9 million of operating cash flows primarily reflects the net income for the six months ended June 30, 2013 of $42.6 million coupled with significant non-cash items, namely $177.2 million of depletion, depreciation and accretion. Increased production from our recent acquisitions and developmental drilling activities drove a significant increase in revenues, as compared to the prior year period, which outpaced related production costs and higher general and administrative expenses pertaining to additional personnel and infrastructure in support of the rapidly expanding business base, resulting in $63.9 million of income from operations.

        Investing Activities.    The primary driver of cash used in investing activities is capital spending, specifically drilling and completions coupled with the acquisition of unevaluated leaseholds in our

42

targeted areas. Net cash used in investing activities was approximately $1.2 billion and $500.8 million for the six months ended June 30, 2013 and 2012, respectively.

        During the first six months of 2013, we incurred cash expenditures of $1.0 billion on oil and natural gas capital expenditures. We participated in the drilling of 159 gross (68.3 net) wells of which 157 gross (66.3 net) wells were completed and capable of production and two gross (2.0 net) wells were dry holes. We spent an additional $80.7 million on other operating property and equipment capital expenditures, of which $68.9 million pertained to pipelines and related infrastructure projects, and the remainder was spent on leasehold improvements, computers and software primarily in our corporate office in Houston, Texas.

        During the first six months of 2012, we spent $468.2 million on oil and natural gas capital expenditures, primarily on the acquisition of unevaluated leasehold. We participated in the drilling of 15 gross (14.2 net) wells of which 14 gross (13.3 net) wells were completed as wells capable of production and one gross (0.9 net) well was a dry hole, and spent an additional $3.5 million on other operating property and equipment capital expenditures, primarily on leasehold improvements, computers and software in our corporate office in Houston, Texas. Proceeds from sales of oil and gas properties were $0.3 million. We also had funds held in escrow of approximately $29.4 million related to pending acquisitions.

        Financing Activities.    Net cash flows provided by financing activities were $936.4 million and $722.7 million for the six months ended June 30, 2013 and 2012, respectively. The primary drivers of cash provided by financing activities for the six months ended June 30, 2013, are proceeds of $619.5 million from the issuance of the additional 2021 Notes and $335.5 million, net of issuance costs, from the issuance of Series A Preferred Stock. The impact of our Senior Credit Agreement was substantially neutral to financing activities for the six months ended June 30, 2013 as additional borrowings were offset by repayments.

        On June 18, 2013, we completed our offering of 345,000 shares of the Series A Preferred Stock at a public offering price of $1,000 per share. The net proceeds to us from the offering of the Series A Preferred Stock were approximately $335.5 million, after deducting the underwriting discount and offering expenses. We used the net proceeds from the offering to repay a portion of the outstanding borrowings under our Senior Credit Agreement.

        On January 14, 2013, we completed the issuance of an additional $600 million aggregate principal amount of our 2021 Notes at a price to the initial purchasers of 105% of par. The net proceeds from the sale of the additional 2021 Notes were approximately $619.5 million (after deducting offering fees and expenses). The net proceeds from this offering were used to repay all of the then outstanding borrowings under our Senior Credit Agreement and for general corporate purposes, including funding a portion of our 2013 capital expenditures program.

        During the first six months of 2012, as discussed in Item 1. Condensed Consolidated Financial Statements (Unaudited)—Note 2, "Recapitalization," HALRES recapitalized us with a $550.0 million investment structured as the purchase of $275.0 million in new common stock, a $275.0 million five-year 8.0% convertible note and warrants for the purchase of an additional 36.7 million shares of our common stock at an exercise price of $4.50 per share. The convertible note provided $231.4 million cash flow from borrowings and $43.6 million cash flow from warrants issued. Proceeds from the Recapitalization were used to repay the $208.0 million of borrowings under previous credit facilities. In addition, we received $400.0 million, subject to certain adjustments, from the private placement sale of convertible Preferred Stock during March 2012. In connection with the closing of the Recapitalization and the Preferred Stock, we incurred a total of $18.1 million in equity issuance costs during the six months ended June 30, 2012.

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        All restricted stock awards were vested as a result of the change in control in February 2012. For the six months ended June 30, 2012, we repurchased $2.1 million in common stock from participants under our 2006 Long-Term Incentive Plan to net settle the related withholding tax liability.

Contractual Obligations

        We lease corporate office space in Houston and Plano, Texas; Tulsa, Oklahoma; Denver, Colorado; and Williston, North Dakota as well as a number of other field office locations. Rent expense was approximately $4.4 million and $1.2 million for the six months ended June 30, 2013 and 2012, respectively. In addition, we have commitments for certain equipment under long-term operating lease agreements, namely drilling rigs as well as pipeline and well equipment, with various expiration dates through 2015. Early termination of the drilling rig commitments would result in termination penalties approximating $42.6 million, which would be in lieu of the remaining $68.9 million of drilling rig commitments as of June 30, 2013. As of June 30, 2013, the amount of commitments under office and equipment lease agreements is consistent with the levels at December 31, 2012 disclosed in our Annual Report on Form 10-K, approximating $66.7 million in the aggregate, and containing various expiration dates through 2024.

Critical Accounting Policies and Estimates

        Our discussion and analysis of our financial condition and results of operations are based upon the unaudited condensed consolidated financial statements, which have been prepared in accordance with accounting principles generally accepted in the United States. Preparation of these unaudited condensed consolidated financial statements requires us to make estimates and judgments that affect the reported amounts of assets, liabilities, revenues and expenses. There have been no material changes to our critical accounting policies from those described in our Annual Report on Form 10-K for the year ended December 31, 2012.

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Results of Operations

Three Months Ended June 30, 2013 and 2012

        We reported net income of $37.1 million and $7.7 million for the three months ended June 30, 2013 and 2012, respectively. The following table summarizes key items of comparison and their related change for the periods indicated.

	Three Months Ended June 30,
In thousands (except per unit and per Boe amounts)	2013			2012			Change
Net income (loss)	$	37,088		$	7,659		$	29,429
Operating revenues:
Oil		202,490			20,383			182,107
Natural gas		6,845			1,270			5,575
Natural gas liquids		4,254			1,653			2,601
Other		754			35			719
Operating expenses:
Production:
Lease operating		31,833			8,303			23,530
Workover and other		623			540			83
Taxes other than income		18,567			1,908			16,659
Gathering and other		2,802			60			2,742
Restructuring		(164	)		903			(1,067	)
General and administrative:
General and administrative		28,886			12,362			16,524
Share-based compensation		4,640			529			4,111
Depletion, depreciation and accretion:
Depletion—Full cost		92,915			5,183			87,732
Depreciation—Other		1,471			345			1,126
Accretion expense		929			428			501
Other income (expenses):
Net gain (loss) on derivative contracts		34,100			13,671			20,429
Interest expense and other, net		(5,732	)		(4,179	)		(1,553	)
Income tax (provision) benefit		(23,121	)		5,387			(28,508	)
Production:
Oil—MBbls		2,212			221			1,991
Natural Gas—Mmcf		1,881			584			1,297
Natural gas liquids—MBbls		129			38			91
Total MBoe(1)		2,654			356			2,298
Average daily production—Boe(1)		29,165			3,912			25,253
Average price per unit(2):
Oil price—Bbl	$	91.54		$	92.23		$	(0.69	)
Natural gas price—Mcf		3.64			2.17			1.47
Natural gas liquids price—Bbl		32.98			43.50			(10.52	)
Total per Boe(1)		80.48			65.47			15.01
Average cost per Boe:
Production:
Lease operating	$	11.99		$	23.32		$	(11.33	)
Workover and other		0.23			1.52			(1.29	)
Taxes other than income		7.00			5.36			1.64
Gathering and other		1.06			0.17			0.89
Restructuring		(0.06	)		2.54			(2.60	)
General and administrative:
General and administrative		10.88			34.72			(23.84	)
Share-based compensation		1.75			1.49			0.26
Depletion		35.01			14.56			20.45

⁽¹⁾

Natural gas reserves are converted to oil reserves using a ratio of six Mcf to one Bbl of oil. This ratio does not assume price equivalency and, given price differentials, the price for a barrel of oil equivalent for natural gas may differ significantly from the price for a barrel of oil.

⁽²⁾

Amounts exclude the impact of cash paid/received on settled contracts as we did not elect to apply hedge accounting.

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        For the three months ended June 30, 2013, oil, natural gas and natural gas liquids revenues increased $190.3 million from the same period in 2012. The increase was primarily due to an increase in production volumes resulting from the Merger, the East Texas Acquisition and the Williston Basin Acquisition and the continued development within these areas, which collectively accounted for an increase of approximately 26,000 Boe per day in production and $196.1 million of incremental revenues. Realized average prices per Boe increased $15.01 to $80.48 per Boe.

        Lease operating expenses increased $23.5 million for the three months ended June 30, 2013, primarily due to $24.0 million of costs incurred on our recently acquired assets and the increase in production within these areas as we continue to carry out our development plan. This increase was offset by a decrease on our existing properties. Lease operating expenses were $11.99 per Boe for the three months ended June 30, 2013, compared to $23.32 per Boe for the same period in 2012. The decrease per Boe is largely due to a lower rate per Boe on the recently acquired properties.

        Workover expenses increased $0.1 million for the three months ended June 30, 2013 compared to the same period in 2012 primarily due to $0.5 million of expenses associated with our recently acquired assets and the increase in activity in these areas. This increase was partially offset by decreased workover expenses on our existing properties.

        Taxes other than income increased $16.7 million for the three months ended June 30, 2013 as compared to the same period in 2012 primarily due to $16.0 million of taxes associated with our recently acquired properties and the increase in production within these areas as we continue to carry out our development plan. Most production taxes are based on realized prices at the wellhead. As revenues or volumes from oil and natural gas sales increase or decrease, production taxes on these sales also increase or decrease directly. On a per unit basis, taxes other than income were $7.00 per Boe and $5.36 per Boe for the three months ended June 30, 2013 and 2012, respectively.

        Gathering and other expenses for the three months ended June 30, 2013 and 2012 were $2.8 million and $0.1 million, respectively. In 2013, approximately $1.0 million of these expenses were attributable to midstream infrastructure that we are developing in the Woodbine and Utica / Point Pleasant areas and approximately $1.8 million relates to gathering and other fees paid on our oil and natural gas production.

        In March 2012, we announced our intention to close the Plano, Texas office and began the process of relocating key administrative functions to our corporate headquarters in Houston, Texas (the Restructuring). As part of the Restructuring, we offered certain severance and retention benefits to affected employees. As of May 2013, the requisite service period had ended and all severance and retention related payments had been made.

        General and administrative expense for the three months ended June 30, 2013 increased $16.5 million to $28.9 million as compared to the same period in 2012. The increase in general and administrative expenses is attributable to increases in payroll and related employee benefit costs of $10.3 million, office related expenses of $1.7 million and professional fees of $4.5 million, in support of our expanding business base and increased corporate activities subsequent to the Recapitalization.

        Share-based compensation expense for the three months ended June 30, 2013 was $4.6 million, an increase of $4.1 million compared to the same period in 2012. The increase in share-based compensation expense results from new awards to employees, as a result of our increase in employee headcount, and directors since the prior year period.

        Depletion for oil and natural gas properties is calculated using the unit of production method, which depletes the capitalized costs of evaluated properties plus future development costs based on the ratio of production volume for the current period to total remaining reserve volume as of the beginning of the period for the evaluated properties. Depletion expense increased $87.7 million to $92.9 million for the three months ended June 30, 2013 compared to the same period in 2012, primarily due to a

46

higher depletion rate per Boe and increased production. On a per unit basis, depletion expense was $35.01 per Boe for the three months ended June 30, 2013 compared to $14.56 per Boe for the three months ended June 30, 2012. The increase in depletion expense and the depletion rate per Boe is primarily due to the increase in production volumes and reserves as a result of the Merger, the East Texas Acquisition and the Williston Basin Acquisitions during the third and fourth quarters of 2012.

        Accretion expense is a function of changes in the discounted asset retirement obligation liability from period to period. We recorded accretion expense of $0.9 million for the three months ended June 30, 2013, compared to $0.4 million for the same period in 2012.

        We enter into derivative commodity instruments to economically hedge our exposure to price fluctuations on our anticipated oil and natural gas production. We have also, in the past, entered into interest rate swaps to mitigate exposure to market rate fluctuations by converting variable interest rates to fixed interest rates. Consistent with prior years, we have elected not to designate any positions as cash flow hedges for accounting purposes, and accordingly, we recorded the net change in the mark-to-market value of these derivative contracts in the unaudited condensed consolidated statements of operations. At June 30, 2013, we had a $20.6 million derivative asset, $9.3 million of which was classified as current, and we had a $5.2 million derivative liability, all of which was classified as current. We recorded a net derivative gain of $34.1 million ($34.5 million net unrealized gain and $0.4 million net realized loss on settled contracts and premium costs) for the three months ended June 30, 2013 compared to a net derivative gain of $13.7 million ($12.7 million net unrealized gain and $1.0 million net realized gain), in the same period in 2012.

        Interest expense increased $1.6 million for the three months ended June 30, 2013 from the same period in 2012. Capitalized interest for the three months ended June 30, 2013 and 2012 was $53.5 million and $3.3 million, respectively. This increase in capitalized interest was driven by the $1.8 billion increase in our unevaluated properties since June 30, 2012. Interest expense subject to capitalization increased to $61.2 million in the three months ended June 30, 2013 from $7.5 million in the comparable prior year period. The increase in interest subject to capitalization is attributed to the 2020 Notes and the 2021 Notes, which were issued subsequent to June 30, 2012.

        We recorded an income tax provision of $23.1 million for the three months ended June 30, 2013 due to our pre-tax income of $60.2 million compared to an income tax benefit of $5.4 million due to our pre-tax income of $2.3 million in the prior year. The effective tax rate for the three months ended June 30, 2013 is 38.3% compared to 237.0% for the three months ended June 30, 2012. The change in effective tax rate is primarily due to the increase in pre-tax income in the current period and the impact of federal income tax limitations on the deductibility of interest expense on the 2017 Note issued as part of the Recapitalization in February 2012.

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Six Months Ended June 30, 2013 and 2012

        We reported net income of $42.6 million and a net loss $25.7 million for the six months ended June 30, 2013 and 2012, respectively. The following table summarizes key items of comparison and their related change for the periods indicated.

	Six Months Ended June 30,
In thousands (except per unit and per Boe amounts)	2013			2012			Change
Net income (loss)	$	42,553		$	(25,663	)	$	68,216
Operating revenues:
Oil		383,317			43,380			339,937
Natural gas		12,514			2,957			9,557
Natural gas liquids		8,082			3,850			4,232
Other		1,284			71			1,213
Operating expenses:
Production:
Lease operating		57,137			15,916			41,221
Workover and other		2,247			1,261			986
Taxes other than income		36,003			3,834			32,169
Gathering and other		3,135			107			3,028
Restructuring		507			1,007			(500	)
General and administrative:
General and administrative		58,148			28,571			29,577
Share-based compensation		6,975			4,632			2,343
Depletion, depreciation and accretion:
Depletion—Full cost		172,806			10,545			162,261
Depreciation—Other		2,542			561			1,981
Accretion expense		1,825			829			996
Other income (expenses):
Net gain (loss) on derivative contracts		15,678			8,726			6,952
Interest expense and other, net		(10,582	)		(17,176	)		6,594
Income tax (provision) benefit		(26,415	)		(208	)		(26,207	)
Production:
Oil—MBbls		4,143			447			3,696
Natural Gas—Mmcf		3,692			1,199			2,493
Natural gas liquids—MBbls		238			78			160
Total MBoe(1)		4,996			725			4,271
Average daily production—Boe(1)		27,602			3,984			23,618
Average price per unit(2):
Oil price—Bbl	$	92.52		$	97.05		$	(4.53	)
Natural gas price—Mcf		3.39			2.47			0.92
Natural gas liquids price—Bbl		33.96			49.36			(15.40	)
Total per Boe(1)		80.85			69.22			11.63
Average cost per Boe:
Production:
Lease operating	$	11.44		$	21.95		$	(10.51	)
Workover and other		0.45			1.74			(1.29	)
Taxes other than income		7.21			5.29			1.92
Gathering and other		0.63			0.15			0.48
Restructuring		0.10			1.39			(1.29	)
General and administrative:
General and administrative		11.64			39.41			(27.77	)
Share-based compensation		1.40			6.39			(4.99	)
Depletion		34.59			14.54			20.05

⁽¹⁾

Natural gas reserves are converted to oil reserves using a ratio of six Mcf to one Bbl of oil. This ratio does not assume price equivalency and, given price differentials, the price for a barrel of oil equivalent for natural gas may differ significantly from the price for a barrel of oil.

⁽²⁾

Amounts exclude the impact of cash paid/received on settled contracts as we did not elect to apply hedge accounting.

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        For the six months ended June 30, 2013, oil, natural gas and natural gas liquids revenues increased $353.7 million from the same period in 2012. The increase was primarily due to an increase in production volumes resulting from the Merger, the East Texas Acquisition and the Williston Basin Acquisition and the continued development within these areas, which collectively accounted for an increase of approximately 23,600 Boe per day in production and $353.3 million of incremental revenues. Realized average prices per Boe increased $11.63 to $80.85 per Boe.

        Lease operating expenses increased $41.2 million for the six months ended June 30, 2013, primarily due to $38.8 million of costs incurred on our recently acquired assets and the increase in production within these areas as we continue to carry out our development plan. The remaining increases are due to higher power costs, service costs and repairs. Lease operating expenses were $11.44 per Boe for the first six months of 2013 compared to $21.95 per Boe for the same period in 2012. The decrease per Boe is largely due to a lower rate per Boe on the recently acquired properties.

        Workover expenses increased $1.0 million for the six months ended June 30, 2013 compared to the same period in 2012 primarily due to $1.8 million of expenses associated with our recently acquired assets, including the increase in activity as we continue to develop these areas, partially offset by decreased workover expenses on our existing properties.

        Taxes other than income increased $32.2 million for the six months ended June 30, 2013 as compared to the same period in 2012 primarily due to $31.0 million of taxes associated with our recently acquired properties and the increase in production within these areas as we continue to carry out our development plan. Most production taxes are based on realized prices at the wellhead. As revenues or volumes from oil and natural gas sales increase or decrease, production taxes on these sales also increase or decrease directly. On a per unit basis, taxes other than income were $7.21 per Boe and $5.29 per Boe for the six months ended June 30, 2013 and 2012, respectively.

        Gathering and other expenses for the six months ended June 30, 2013 and 2012 were $3.1 million and $0.1 million, respectively. In 2013, approximately $1.1 million of these expenses were attributable to midstream infrastructure that we are developing in the Woodbine and Utica / Point Pleasant areas and approximately $2.0 million relates to gathering and other fees paid on our oil and natural gas production.

        In March 2012, we announced our intention to close the Plano, Texas office and began the process of relocating key administrative functions to our corporate headquarters in Houston, Texas (the Restructuring). As part of the Restructuring, we offered certain severance and retention benefits to affected employees. We incurred $0.5 million and $1.0 million in costs associated with the Restructuring, which is now complete, for the six months ended June 30, 2013 and 2012, respectively.

        General and administrative expense for the six months ended June 30, 2013 increased $29.6 million to $58.1 million as compared to the same period in 2012. The increase in general and administrative expenses is attributable to increases in payroll and related employee benefit costs of $14.9 million, office related expenses of $7.6 million and professional fees of $7.0 million, in support of the expanding business base and increased corporate activities subsequent to the Recapitalization.

        Share-based compensation expense for the six months ended June 30, 2013 was $7.0 million, an increase of $2.3 million compared to the same period in 2012. In 2012, we incurred approximately $4.3 million for the accelerated vesting of restricted stock awards and stock appreciation rights resulting from the change in control that occurred due to the Recapitalization in February 2012. The year over year increase, excluding these change in control payments, approximates $6.6 million, which is a reflection of the investment in personnel since the prior year.

        Depletion for oil and natural gas properties is calculated using the unit of production method, which depletes the capitalized costs of evaluated properties plus future development costs based on the ratio of production volume for the current period to total remaining reserve volume as of the beginning

49

of the period for the evaluated properties. Depletion expense increased $162.3 million to $172.8 million for the six months ended June 30, 2013 compared to the same period in 2012, primarily due to a higher depletion rate per Boe and increased production. On a per unit basis, depletion expense was $34.59 per Boe for the six months ended June 30, 2013 compared to $14.54 per Boe for the six months ended June 30, 2012. The increase in depletion expense and the depletion rate per Boe is primarily due to the increase in production volumes and reserves as a result of the Merger, the East Texas Acquisition and the Williston Basin Acquisitions during the third and fourth quarters of 2012.

        Accretion expense is a function of changes in the discounted asset retirement obligation liability from period to period. We recorded accretion expense of $1.8 million for the six months ended June 30, 2013, compared to $0.8 million for the same period in 2012.

        We enter into derivative commodity instruments to economically hedge our exposure to price fluctuations on our anticipated oil and natural gas production. We have also, in the past, entered into interest rate swaps to mitigate exposure to market rate fluctuations by converting variable interest rates to fixed interest rates. Consistent with prior years, we have elected not to designate any positions as cash flow hedges for accounting purposes, and accordingly, we recorded the net change in the mark-to-market value of these derivative contracts in the unaudited condensed consolidated statements of operations. At June 30, 2013, we had a $20.6 million derivative asset, $9.3 million of which was classified as current, and we had a $5.2 million derivative liability, all of which was classified as current. We recorded a net derivative gain of $15.7 million ($17.7 million net unrealized gain and $2.0 million net realized loss on settled contracts and premium costs) for the six months ended June 30, 2013 compared to a net derivative gain of $8.7 million ($7.7 million net unrealized gain and $1.0 million net realized gain), in the same period in 2012.

        Interest expense decreased $6.6 million for the six months ended June 30, 2013 from the same period in 2012. Capitalized interest for the six months ended June 30, 2013 and 2012 was $106.4 million and $3.4 million, respectively. This increase in capitalized interest was driven by the $1.8 billion increase in our unevaluated properties since June 30, 2012. Interest expense subject to capitalization increased to $118.6 million in the six months ended June 30, 2013 from $20.7 million in the comparable prior year period. The increase in interest subject to capitalization is attributed to the 2020 Notes and the 2021 Notes, which were issued subsequent to June 30, 2012.

        We recorded an income tax provision of $26.4 million for the six months ended June 30, 2013 due to our pre-tax income of $69.0 million compared to a tax provision of $0.2 million on a pre-tax loss of $25.5 million in the prior year. The effective tax rate for the six months ending June 30, 2013 was 38.3% compared to 0.8% for the six months ending June 30, 2012. The change in effective tax rate is primarily due to the increase in pre-tax income in the current year and the impact of federal income tax limitations on the deductibility of interest expense on the 2017 Note issued as part of the Recapitalization in February 2012.

Recently Issued Accounting Pronouncements

        We discuss recently adopted and issued accounting standards in Item 1. Condensed Consolidated Financial Statements (Unaudited)—Note 1, "Financial Statement Presentation."

Related Person Transaction

        In the third quarter of 2013, we expect to close on the acquisition of certain oil and natural gas properties from an unaffiliated third party, which transaction may aggregate up to approximately $2 million. In connection therewith, we have agreed to pay a brokerage fee to Justin Elkouri, who located the selling party and assisted us in the acquisition. Justin Elkouri is not employed by us and provided services as an independent contractor in connection with the transaction. Depending on the amount of acreage ultimately acquired by us, he may receive a brokerage fee of up to approximately

50

$93,000 for these services. Justin Elkouri is the adult son of David S. Elkouri, our Executive Vice President and General Counsel. Mr. Elkouri has no financial interest in the transaction or in any fee paid to his son. The fee to be paid to Justin Elkouri is commensurate with brokerage fees we pay to unrelated third parties under similar circumstances, and the fee was reviewed and approved by our Audit Committee in accordance with our policies and procedures relating to transactions involving executives and members of their family.

Item 3.    Quantitative and Qualitative Disclosures About Market Risk

Derivative Instruments and Hedging Activity

        We are exposed to various risks including energy commodity price risk. When oil, natural gas, and natural gas liquids prices decline significantly our ability to finance our capital budget and operations may be adversely impacted. We expect energy prices to remain volatile and unpredictable, therefore we have designed a risk management policy which provides for the use of derivative instruments to provide partial protection against declines in oil and natural gas prices by reducing the risk of price volatility and the affect it could have on our operations. The types of derivative instruments that we typically utilize include costless collars, swaps, and put options. The total volumes which we hedge through the use of our derivative instruments varies from period to period, however, generally our objective is to hedge approximately 70% to 80% of our current and anticipated production for the next 18 to 24 months. Our hedge policies and objectives may change significantly as our operational profile changes and/or commodities prices change.

        We are exposed to market risk on our open derivative contracts related to potential non-performance by our counterparties. It is our policy to enter into derivative contracts, including interest rate swaps, only with counterparties that are creditworthy financial institutions deemed by management as competent and competitive market makers. Each of the counterparties to our derivative contracts is a lender or an affiliate of a lender in our Senior Credit Agreement. We did not post collateral under any of these contracts as they are secured under the Senior Credit Agreement. Please refer to Item 1. Condensed Consolidated Financial Statements (Unaudited)—Note 8, "Derivative and Hedging Activities" for additional information.

        We have also been exposed to interest rate risk on our variable interest rate debt. If interest rates increase, our interest expense would increase and our available cash flow would decrease. Historically, we entered into interest rate swaps to reduce the exposure to market rate fluctuations by converting variable interest rates to fixed interest rates. At June 30, 2013, we did not have any open positions that converted our variable interest rate debt to fixed interest rates. We continue to monitor our risk exposure as we incur future indebtedness at variable interest rates and will look to continue our risk management policy as situations present themselves.

        We account for our derivative activities under the provisions of ASC 815, Derivatives and Hedging (ASC 815). ASC 815 establishes accounting and reporting that every derivative instrument be recorded on the balance sheet as either an asset or liability measured at fair value. Please refer to Item 1. Condensed Consolidated Financial Statements (Unaudited)—Note 8, "Derivative and Hedging Activities" for additional information.

Fair Market Value of Financial Instruments

        The estimated fair values for financial instruments under ASC 825, Financial Instruments (ASC 825) are determined at discrete points in time based on relevant market information. These estimates involve uncertainties and cannot be determined with precision. The estimated fair value of cash, accounts receivable and accounts payable approximates their carrying value due to their short-term nature. See Item 1. Condensed Consolidated Financial Statements (Unaudited)—Note 7, "Fair Value Measurements" for additional information.

51

Interest Rate Sensitivity

        We are also exposed to market risk related to adverse changes in interest rates. Our interest rate risk exposure results primarily from fluctuations in short-term rates, which are LIBOR and ABR based and may result in reductions of earnings or cash flows due to increases in the interest rates we pay on these obligations.

        At June 30, 2013, total long-term debt was $2.7 billion of which approximately 87% bears interest at a weighted average fixed interest rate of 9.0% per year. The remaining 13% of our total debt balance at June 30, 2013 bears interest at floating or market interest rates that, at our option, are tied to prime rate or LIBOR. Fluctuations in market interest rates will cause our annual interest costs to fluctuate. At June 30, 2013, the weighted average interest rate on our variable rate debt was 2.2% per year. If the balance of our variable rate debt at June 30, 2013 were to remain constant, a 10% change in market interest rates would impact our cash flow by approximately $0.2 million per quarter.

Item 4.    Controls and Procedures

        Under the supervision and with the participation of our management, including our Chief Executive Officer and Chief Financial Officer, we evaluated the design and operation of our disclosure controls and procedures (as defined in rules 13a-15(e) and 15d-15(e) of the Securities Exchange Act of 1934, or the Exchange Act) as of June 30, 2013. On the basis of this review, our management, including our Chief Executive Officer and Chief Financial Officer, concluded that our disclosure controls and procedures are designed, and are effective, to give reasonable assurance that the information required to be disclosed by us in reports that we file under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the rules and forms of the SEC and to ensure that information required to be disclosed in the reports filed or submitted under the Exchange Act is accumulated and communicated to our management, including our Chief Executive Officer and Chief Financial Officer, in a manner that allows timely decisions regarding required disclosure.

        We did not have any change in our internal controls over financial reporting during the quarter ended June 30, 2013 that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

PART II. OTHER INFORMATION

Item 1.    Legal Proceedings

        From time to time, we may be a plaintiff or defendant in a pending or threatened legal proceeding arising in the normal course of our business. While the outcome and impact of currently pending legal proceedings cannot be determined, our management and legal counsel believe that the resolution of these proceedings through settlement or adverse judgment will not have a material effect on our consolidated operating results, financial position or cash flows.

Item 1A.    Risk Factors

        There have been no changes to the risk factors described in our Annual Report on Form 10-K for the year ended December 31, 2012, except as described below.

         We may have difficulty financing our planned capital expenditures which could adversely affect our growth.

        We have experienced, and expect to continue to experience, substantial capital expenditure and working capital needs, primarily as a result of our drilling program. We intend to continue to selectively increase our acreage position, which would require capital in addition to the capital necessary to drill

52

on our existing acreage. In addition, it is likely that we will acquire acreage in other areas that we believe are prospective for oil and natural gas production and expend capital to develop such acreage. We expect to use borrowings under our Senior Credit Agreement, proceeds from potential asset dispositions and proceeds from potential future capital markets transactions, if necessary, to fund capital expenditures that are in excess of our cash flow and cash on hand.

        Our Senior Credit Agreement limits our borrowings to the lesser of the borrowing base and the total commitments. Our borrowing base is currently $810.0 million. Our borrowing base is determined semi-annually, and may also be redetermined periodically at the discretion of the banks. Lower oil and natural gas prices may result in a reduction in our borrowing base at the next redetermination. A reduction in our borrowing base could require us to repay any indebtedness in excess of the borrowing base. Additionally, the indentures governing our senior unsecured debt contain covenants limiting our ability to incur additional indebtedness, including borrowings under our Senior Credit Agreement, unless we meet one of two alternative tests. The first test applies to all indebtedness and requires that after giving effect to the incurrence of additional debt the ratio of our adjusted consolidated EBITDA (as defined in our indentures) to our adjusted consolidated interest expense over the trailing four fiscal quarters will be at least 2.0 to 1.0 under the most restrictive indenture. The second test applies only to borrowings under credit agreements, including indentures and our Senior Credit Agreement, that do not meet the first test and it limits these borrowings to the greater of a fixed sum of $750 million and 30% of our adjusted consolidated net tangible assets (as defined in all of our indentures), which is determined using discounted future net revenues from proved oil and natural gas reserves as of the end of each year. Currently, we are permitted to incur additional indebtedness under our indentures, but may be limited in the future. Lower oil and natural gas prices in the future could reduce our adjusted consolidated EBITDA, as well as our adjusted consolidated net tangible assets, and thus could reduce our ability to incur additional indebtedness.

        Additionally, our ability to complete future equity offerings is limited by general market conditions. If we are not able to borrow sufficient amounts under our Senior Credit Agreement and/or are unable to raise sufficient capital to fund our capital expenditures, we may be required to curtail our drilling, development, land acquisition and other activities, which could result in a decrease in our production of oil and natural gas, forfeiture of leasehold interests if we are unable or unwilling to renew them, and could force us to sell some of our assets on an untimely or unfavorable basis, each of which could have a material adverse effect on our results and future operations.

         We are subject to various contractual limitations that effect the discretion of our management in operating our business.

        The indentures governing our senior unsecured debt and our Senior Credit Agreement and the certificate of designations governing our outstanding preferred stock contain various provisions that may limit our management's discretion in certain respects. In particular, these agreements limit our and our subsidiaries' ability to, among other things:

•

pay dividends on, redeem or repurchase shares of our common stock and, under certain circumstances, our outstanding preferred stock, and redeem or repurchase our subordinated debt;

•

make loans to others;

•

make investments;

•

incur additional indebtedness or issue preferred stock that is senior to our outstanding preferred stock as to dividends or rights upon liquidation, winding-up or dissolution;

•

create certain liens;

53

•

sell assets;

•

enter into agreements that restrict dividends or other payments from our restricted subsidiaries to us;

•

consolidate, merge or transfer all or substantially all of our assets and those of our restricted subsidiaries taken as a whole;

•

engage in transactions with affiliates;

•

enter into hedging contracts;

•

create unrestricted subsidiaries; and

•

enter into sale and leaseback transactions.

        Additionally, if dividends on our outstanding preferred stock are in arrears and unpaid for six or more quarterly periods, the holders (voting as a single class) of our outstanding preferred stock will be entitled to elect two additional directors to our Board of Directors until paid in full.

        Compliance with these and other limitations may limit our ability to operate and finance our business and engage in certain transactions in the manner we might otherwise. In addition, if we fail to comply with the limitations under our indentures or Senior Credit Agreement, our creditors, if the agreements so provide, may accelerate the related indebtedness as well as any other indebtedness to which a cross-acceleration or cross-default provision applies. In addition, lenders may be able to terminate any commitments they had made to make further funds available to us.

         We depend on computer and telecommunications systems and failures in our systems or cyber security attacks could significantly disrupt our business operations.

        We have entered into agreements with third parties for hardware, software, telecommunications and other information technology services in connection with our business. In addition, we have developed proprietary software systems, management techniques and other information technologies incorporating software licensed from third parties. It is possible we could incur interruptions from cyber security attacks, computer viruses or malware. We believe that we have positive relations with our related vendors and maintain adequate anti-virus and malware software and controls; however, any interruptions to our arrangements with third parties to our computing and communications infrastructure or our information systems could significantly disrupt our business operations.

Item 2.    Unregistered Sales of Equity Securities and the Use of Proceeds

        None.

Item 3.    Defaults Upon Senior Securities

        None.

Item 4.    Mine Safety Disclosures

        Not applicable.

Item 5.    Other Information

        None.

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Item 6.    Exhibits

        The following documents are included as exhibits to this Quarterly Report on Form 10-Q. Those exhibits incorporated by reference are so indicated by the information supplied with respect thereto. Those exhibits which are not incorporated by reference are attached hereto.

3.1	Amended and Restated Certificate of Incorporation of RAM Energy Resources, Inc. dated February 8, 2012 (Incorporated by reference to Exhibit 3.1 of our Current Report on Form 8-K filed February 9, 2012).
3.2	Certificate of Amendment of the Amended and Restated Certificate of Incorporation of Halcón Resources Corporation, effective as of February 10, 2012 (Incorporated by reference to Exhibit 3.2 of our Current Report on Form 8-K filed February 9, 2012).
3.3	Certificate of Designation, Preferences, Rights and Limitations of 8% Automatically Convertible Preferred Stock of Halcón Resources Corporation dated March 2, 2012 (Incorporated by reference to Exhibit 3.1 of our Current Report on Form 8-K filed March 5, 2012).
3.4	Certificate of Elimination of 8% Automatically Convertible Preferred Stock dated November 30, 2012 (Incorporated by reference to Exhibit 3.1 of our Current Report on Form 8-K filed December 4, 2012).
3.5	Certificate of Designation, Preferences, Rights and Limitations of 8% Automatically Convertible Preferred Stock of Halcón Resources Corporation dated December 5, 2012 (Incorporated by reference to Exhibit 3.1 of our Current Report on Form 8-K filed December 11, 2012).
3.6	Certificate of Amendment of the Amended and Restated Certificate of Incorporation of Halcón Resources Corporation dated January 17, 2013 (Incorporated by reference to Exhibit 3.1 of our Current Report on Form 8-K filed January 23, 2013).
3.7	Fourth Amended and Restated Bylaws of Halcón Resources Corporation (Incorporated by reference to Exhibit 3.1 of our Current Report on Form 8-K filed November 6, 2012).
3.8	Certificate of Amendment of the Amended and Restated Certificate of Incorporation of Halcón Resources Corporation, effective as of May 23, 2013 (Incorporated by reference to Exhibit 3.1 of our Current Report on Form 8-K filed May 29, 2013).
3.9	Certificate of Designations, Preferences, Rights and Limitations of 5.75% Series A Convertible Perpetual Preferred Stock of Halcón Resources Corporation (Incorporated by reference to Exhibit 3.1 of our Current Report on Form 8-K filed June 18, 2013).
3.10	Certificate of Elimination of 8% Automatically Convertible Preferred Stock of Halcón Resources Corporation (Incorporated by reference to Exhibit 3.2 of our Current Report on Form 8-K filed June 18, 2013).
4.1	Convertible Promissory Note dated February 8, 2012, between Halcón Resources Corporation and HALRES LLC (formerly Halcón Resources LLC) (Incorporated by reference to Exhibit 4.1 of our Current Report on Form 8-K filed February 9, 2012).
4.2	Warrant Certificate dated February 8, 2012, between Halcón Resources Corporation and HALRES LLC (formerly Halcón Resources LLC) (Incorporated by reference to Exhibit 4.2 of our Current Report on Form 8-K filed February 9, 2012).

55

4.3	Registration Rights Agreement dated February 8, 2012, between Halcón Resources Corporation and HALRES LLC (formerly Halcón Resources LLC) (Incorporated by reference to Exhibit 4.3 of our Current Report on Form 8-K filed February 9, 2012).
4.4	Indenture dated as of July 16, 2012, among Halcón Resources Corporation, the subsidiary guarantors named therein and U.S. Bank National Association, as Trustee, relating to Halcón Resources Corporation's 9.75% Senior Notes due 2020 (Incorporated by reference to Exhibit 4.1 of our Current Report on Form 8-K filed July 17, 2012).
4.5	Registration Rights Agreement dated July 16, 2012, among Halcón Resources Corporation, the subsidiary guarantors named therein, and the initial purchaser named therein (Incorporated by reference to Exhibit 4.2 of our Current Report on Form 8-K filed July 17, 2012).
4.6	First Supplemental Indenture dated as of August 1, 2012, by and among Halcón Resources Corporation, the parties named therein as subsidiary guarantors, and U.S. Bank National Association, as Trustee, relating to the 9.75% senior notes due 2020 (Incorporated by reference to Exhibit 4.1 of our Current Report on Form 8-K filed August 2, 2012).
4.7	Second Supplemental Indenture dated as of August 1, 2012, by and among Halcón Resources Corporation, the parties named therein as subsidiary guarantors, and U.S. Bank National Association, as Trustee, relating to the 9.75% senior notes due 2020 (Incorporated by reference to Exhibit 4.2 of our Current Report on Form 8-K filed August 2, 2012).
4.8	Registration Rights Agreement dated as of August 1, 2012, among CH4 Energy II, LLC, PetroMax Leon, LLC and Petro Texas LLC and Halcón Resources Corporation (subsequently joined by U.S. King King LLC) (Incorporated by reference to Exhibit 4.1 of our Current Report on Form 8-K filed August 7, 2012).
4.9	Registration Rights Agreement dated March 5, 2012, between Halcón Resources Corporation and Barclays Capital, Inc. as lead placement agent for the benefit of the initial holders named therein (Incorporated by reference to Exhibit 4.1 of our Current Report on Form 8-K filed March 5, 2012).
4.10	Registration Rights Agreement dated as of November 6, 2012, among Halcón Resources Corporation, the subsidiary guarantors named therein, and the initial purchaser named therein (Incorporated by reference to Exhibit 4.2 of our Current Report on Form 8-K filed November 7, 2012).
4.11	Indenture dated as of November 6, 2012, among Halcón Resources Corporation, the subsidiary guarantors named therein and U.S. Bank National Association, as Trustee, relating to Halcón Resources Corporation's 8.875% Senior Notes due 2021 (Incorporated by reference to Exhibit 4.1 of our Current Report on Form 8-K filed November 7, 2012).
4.12	First Supplemental Indenture dated December 6, 2012, among Halcón Williston I, LLC and Halcón Williston II, LLC, the existing guarantors, Halcón Resources Corporation, the parties named therein as subsidiary guarantors and U.S. Bank National Association, as trustee, relating to the 8.875% senior notes due 2021 (Incorporated by reference to Exhibit 4.3 of our Current Report on Form 8-K filed December 11, 2012).
4.13	Third Supplemental Indenture dated December 6, 2012, among Halcón Resources Corporation and U.S. Bank National Association, as Trustee, relating to the 9.75% senior notes due 2020 (Incorporated by reference to Exhibit 4.4 of our Current Report on Form 8-K filed December 11, 2012).

56

4.14		Registration Rights Agreement dated December 6, 2012, between Halcón Resources Corporation and Petro-Hunt Holdings LLC and Pillar Holdings LLC (Incorporated by reference to Exhibit 4.1 of our Current Report on Form 8-K filed December 11, 2012).
4.15		First Amendment to Registration Rights Agreement dated December 6, 2012, between Halcón Resources Corporation and HALRES LLC (formerly Halcón Resources LLC) (Incorporated by reference to Exhibit 4.2 of our Current Report on Form 8-K filed December 11, 2012).
4.16		Registration Rights Agreement, dated as of January 14, 2013, between Halcón Resources Corporation and Wells Fargo Securities, LLC, on behalf of the initial purchasers named therein (Incorporated by reference to Exhibit 4.1 of our Current Report on Form 8-K filed January 15, 2013).
4.17		Waiver, dated July 3, 2013, relating to Registration Rights Agreement dated December 6, 2012 by and among Halcón Resources Corporation and Petro-Hunt Holdings, LLC and Pillar Holdings, LLC (Incorporated by reference to Exhibit 4.1 of our Current Report on Form 8-K filed July 10, 2013).
10.1		Second Amendment to Senior Revolving Credit Agreement, dated as of January 25, 2013, among Halcón Resources Corporation, as borrower, each of the lenders from time to time party thereto, and JPMorgan Chase Bank, N.A., as administrative agent for the lenders (Incorporated by reference to Exhibit 10.1 of our Current Report on Form 8-K filed January 30, 2013).
10.2		Third Amendment to Senior Revolving Credit Agreement, dated as of April 26, 2013, among Halcón Resources Corporation, as borrower, each of the lenders from time to time party thereto, and JPMorgan Chase Bank, N.A., as administrative agent for the lenders (Incorporated by reference to Exhibit 10.2 of our Quarterly Report on Form 10-Q for the quarterly period ended March 31, 2013).
10.3		Purchase Agreement, dated January 9, 2013, among Halcón Resources Corporation, the subsidiary guarantors named therein and Wells Fargo Securities, LLC, as representative of the initial purchasers named therein (Incorporated by reference to Exhibit 10.1 of our Current Report on Form 8-K filed January 15, 2013).
10.4		Fourth Amendment to Senior Revolving Credit Agreement, dated as of May 8, 2013, among Halcón Resources Corporation, as borrower, each of the lenders from time to time party thereto, and JPMorgan Chase Bank, N.A., as administrative agent for the lenders (Incorporated by reference to Exhibit 10.1 of our Current Report on Form 8-K filed May 14, 2013).
10.5		Fifth Amendment to Senior Revolving Credit Agreement, dated as of June 11, 2013, among Halcón Resources Corporation, as borrower, each of the lenders party thereto, and JPMorgan Chase Bank, N.A., as administrative agent for the lenders (Incorporated by reference to Exhibit 10.1 of our Current Report on Form 8-K filed June 17, 2013).
10.6		Underwriting Agreement, dated June 13, 2013, among Halcón Resources Corporation, J.P. Morgan Securities LLC and Barclays Capital Inc., as representatives of the underwriters named therein (Incorporated by reference to Exhibit 10.1 of our Current Report on Form 8-K filed June 18, 2013).
10.7	†	Halcón Resources Corporation First Amended and Restated 2012 Long-Term Incentive Plan (Incorporated by reference to Exhibit 10.01 of our Current Report on Form 8-K filed March 4, 2013).

57

10.8	†	Amendment No. 1 to Halcón Resources Corporation First Amended and Restated 2012 Long-Term Incentive Plan (Incorporated by reference to Exhibit 10.1 of our Current Report on Form 8-K filed May 29, 2013).
12.1	*	Computation of Ratio of Earnings to Combined Fixed Charges and Preference Dividends
31.1	*	Sarbanes-Oxley Section 302 certification of our Principal Executive Officer
31.2	*	Sarbanes-Oxley Section 302 certification of our Principal Financial Officer
32	*	Sarbanes-Oxley Section 906 certification of Principal Executive Officer and Principal Financial Officer
101.INS	*	XBRL Instance Document
101.SCH	*	XBRL Taxonomy Extension Schema Document
101.CAL	*	XBRL Taxonomy Extension Calculation Linkbase Document
101.DEF	*	XBRL Taxonomy Extension Definition Document
101.LAB	*	XBRL Taxonomy Extension Label Linkbase Document
101.PRE	*	XBRL Taxonomy Extension Presentation Linkbase Document

*

Attached hereto.

†

Indicates management contract or compensatory plan or arrangement

58

SIGNATURES

        Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

	HALCÓN RESOURCES CORPORATION
August 1, 2013	By:	/s/ FLOYD C. WILSON
		Name:	Floyd C. Wilson
		Title:	Chairman of the Board and Chief Executive Officer
August 1, 2013	By:	/s/ MARK J. MIZE
		Name:	Mark J. Mize
		Title:	Executive Vice President, Chief Financial Officer and Treasurer
August 1, 2013	By:	/s/ JOSEPH S. RINANDO, III
		Name:	Joseph S. Rinando, III
		Title:	Vice President and Chief Accounting Officer

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EX-12.1

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Exhibit 12.1

Computation of Ratio of Earnings to Combined Fixed Charges and Preference Dividends
(In thousands, except ratios)

	Six Months Ended June 30,						Years Ended December 31,
	2013			2012			2012			2011		2010		2009			2008
Earnings:
Income (loss) before income taxes	$	68,968		$	(25,455	)	$	(67,066	)	$	5,399	$	3,412	$	(74,730	)	$	(221,636	)
Adjustments:
Equity investment (income) loss		(44	)		—			(373	)		—		—		—			—
Interest capitalized		(106,351	)		(3,436	)		(53,492	)		—		—		—			—
Income (loss) before income taxes, as adjusted	$	(37,427	)	$	(28,891	)	$	(120,931	)	$	5,399	$	3,412	$	(74,730	)	$	(221,636	)
Fixed charges		120,060			21,039			86,589			17,808		23,087		19,021			24,588
Total earnings	$	82,633		$	(7,852	)	$	(34,342	)	$	23,207	$	26,499	$	(55,709	)	$	(197,048	)
Fixed charges:
Interest expense and amortization of finance costs	$	118,600		$	20,663		$	85,372		$	17,373	$	22,655	$	18,590		$	24,182
Rental expense representative of interest factor		1,460			376			1,217			435		432		431			406
Total fixed charges	$	120,060		$	21,039		$	86,589		$	17,808	$	23,087	$	19,021		$	24,588
Ratio of earnings to fixed charges		—	(1)		—	(3)		—	(5)		1.3		1.1		—	(7)		—	(8)
Total fixed charges	$	120,060		$	21,039		$	86,589		$	17,808	$	23,087	$	19,021		$	24,588
Pre-tax preferred dividend requirements		1,160			89,158			110,075			—		—		—			—
Total fixed charges plus preference dividends	$	121,220		$	110,197		$	196,664		$	17,808	$	23,087	$	19,021		$	24,588
Ratio of earnings to combined fixed charges and preference dividends		—	(2)		—	(4)		—	(6)		1.3		1.1		—	(7)		—	(8)

⁽¹⁾

Due to the Company's "Loss before income taxes, as adjusted" for the six months ended June 30, 2013, the ratio coverage was less than 1:1. The Company must generate additional earnings of $37.4 million to achieve a coverage ratio of 1:1.

⁽²⁾

Due to the Company's "Loss before income taxes, as adjusted" for the six months ended June 30, 2013, the ratio coverage was less than 1:1. The Company must generate additional earnings of $38.6 million to achieve a coverage ratio of 1:1.

⁽³⁾

Due to the Company's "Loss before income taxes, as adjusted" for the six months ended June 30, 2012, the ratio coverage was less than 1:1. The Company must generate additional earnings of $28.9 million to achieve a coverage ratio of 1:1.

⁽⁴⁾

Due to the Company's "Loss before income taxes, as adjusted" for the six months ended June 30, 2012, the ratio coverage was less than 1:1. The Company must generate additional earnings of $118.0 million to achieve a coverage ratio of 1:1.

⁽⁵⁾

Due to the Company's "Loss before income taxes, as adjusted" in 2012, the ratio coverage was less than 1:1. The Company must generate additional earnings of $120.9 million to achieve a coverage ratio of 1:1.

⁽⁶⁾

Due to the Company's "Loss before income taxes, as adjusted" in 2012, the ratio coverage was less than 1:1. The Company must generate additional earnings of $231.0 million to achieve a coverage ratio of 1:1.

⁽⁷⁾

Due to the Company's "Loss before income taxes, as adjusted" in 2009, the ratio coverage was less than 1:1. The Company must generate additional earnings of $74.7 million to achieve a coverage ratio of 1:1.

⁽⁸⁾

Due to the Company's "Loss before income taxes, as adjusted" in 2008, the ratio coverage was less than 1:1. The Company must generate additional earnings of $221.6 million to achieve a coverage ratio of 1:1.

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Exhibit 12.1

Computation of Ratio of Earnings to Combined Fixed Charges and Preference Dividends (In thousands, except ratios)

EX-31.1

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Exhibit 31.1

CERTIFICATIONS FOR FORM 10-Q

I, Floyd C. Wilson, certify that:

1.

I have reviewed this quarterly report on Form 10-Q of Halcón Resources Corporation;

2.

Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.

Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.

The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a)

Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b)

Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c)

Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation;

(d)

Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

5.

The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of registrant's board of directors (or persons performing the equivalent functions):

(a)

All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and

(b)

Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

	HALCÓN RESOURCES CORPORATION
August 1, 2013	By:	/s/ FLOYD C. WILSON
		Name:	Floyd C. Wilson
		Title:	Chairman of the Board and Chief Executive Officer

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Exhibit 31.1

CERTIFICATIONS FOR FORM 10-Q

EX-31.2

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Exhibit 31.2

CERTIFICATIONS FOR FORM 10-Q

I, Mark J. Mize, certify that:

1.

I have reviewed this quarterly report on Form 10-Q of Halcón Resources Corporation;

2.

Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.

Based on my knowledge, the financial statements, and other financial information included in this quarterly report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.

The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a)

Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b)

Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c)

Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation;

(d)

Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

5.

The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of registrant's board of directors (or persons performing the equivalent functions):

(a)

All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and

(b)

Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

	HALCÓN RESOURCES CORPORATION
August 1, 2013	By:	/s/ MARK J. MIZE
		Name:	Mark J. Mize
		Title:	Executive Vice President, Chief Financial Officer and Treasurer

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Exhibit 31.2

CERTIFICATIONS FOR FORM 10-Q

EX-32

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Exhibit 32

Certification Pursuant to
Section 906 of the Sarbanes-Oxley Act of 2002
(Subsections (a) and (b) of Section 1350, Chapter 63 of Title 18, United States Code)

        Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (Subsections (a) and (b) of Section 1350, Chapter 63 of Title 18, United States Code), Floyd C. Wilson, Chairman of the Board and Chief Executive Officer, and Mark J. Mize, Executive Vice President, Chief Financial Officer and Treasurer, of Halcón Resources Corporation, (the "Company"), each hereby certifies that, to the best of his knowledge:

(1)

The Company's Quarterly Report on Form 10-Q for the six months ended June 30, 2013 (the "Report") fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and



(2)

The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

August 1, 2013	/s/ FLOYD C. WILSON Floyd C. Wilson Chairman of the Board and Chief Executive Officer
August 1, 2013	/s/ MARK J. MIZE Mark J. Mize Executive Vice President, Chief Financial Officer and Treasurer

        This certification accompanies this Form 10-Q and shall not be deemed "filed" for purposes of Section 18 of the Securities Exchange Act of 1934, or otherwise subject to the liability of that Section.

        A signed original of this written statement required by Section 906 has been provided to, and will be retained by, the Company and furnished to the Securities and Exchange Commission or its staff upon request.

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Exhibit 32

Certification Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (Subsections (a) and (b) of Section 1350, Chapter 63 of Title 18, United States Code)

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PREFERRED STOCK AND STOCKHOLDERS' EQUITY

6 Months Ended

Jun. 30, 2013

PREFERRED STOCK AND STOCKHOLDERS' EQUITY

PREFERRED STOCK AND STOCKHOLDERS' EQUITY

11. PREFERRED STOCK AND STOCKHOLDERS' EQUITY

Preferred Stock and Non-Cash Preferred Stock Dividend

        On February 29, 2012 (the Commitment Date), the Company entered into definitive agreements with a group of certain institutional and selected other accredited investors (collectively, the investors) to sell, in a private offering, 4,444.4511 shares of 8% Automatically Convertible Preferred Stock, par value $0.0001 per share (the Preferred Stock), each share of which was convertible into 10,000 shares of common stock. Also on February 29, 2012, the Company received an executed written consent (the Consent) in lieu of a stockholders' meeting authorizing and approving the conversion of the Preferred Stock into common stock. On March 2, 2012, the Company filed a Certificate of Designation, Preferences, Rights and Limitations of the Preferred Stock (the Certificate of Designation) with the Delaware Secretary of State which stated the conversion was to occur on the twentieth day after the mailing of a definitive information statement to stockholders. On March 5, 2012, the Company issued the Preferred Stock to the investors at $90,000 per share. Gross proceeds from the offering were approximately $400.0 million, or $9.00 per share of common stock, before offering expenses. The Company incurred placement agent fees of $14.0 million and associated expenses of approximately $0.5 million in connection with this offering. On March 28, 2012, the Company mailed a definitive information statement to its common stockholders notifying them that Halcón's majority stockholder had consented to the issuance of common stock, par value $0.0001, upon the conversion of the Preferred Stock. The Preferred Stock automatically converted into 44.4 million shares of common stock on April 17, 2012 in accordance with the terms of the Certificate of Designation. No cash dividends were paid on the Preferred Stock since pursuant to the terms of the Certificate of Designation of the Preferred Stock, conversion occurred prior to May 31, 2012. On November 30, 2012, the Company filed a Certificate of Elimination with the Delaware Secretary of State eliminating all provisions of the Certificate of Designation of the Preferred Stock.

        In accordance with ASC 470, Debt (ASC 470), the Company determined that the conversion feature in the Preferred Stock represented a beneficial conversion feature. The fair value of the common stock of $10.99 per share on the Commitment Date was greater than the conversion price of $9.00 per share of common stock, representing a beneficial conversion feature of $1.99 per share of common stock, or $88.4 million in aggregate. Under ASC 470, $88.4 million (the intrinsic value of the beneficial conversion feature) of the proceeds received from the issuance of the Preferred Stock was allocated to additional paid-in capital, creating a discount on the Preferred Stock (the Discount). The Discount resulting from the allocation of value to the beneficial conversion feature was required to be amortized on a non-cash basis over the approximate 71-month period between the issuance date and the required redemption date of February 9, 2018, or fully amortized upon an accelerated date of redemption or conversion, and recorded as a preferred dividend. As a result, approximately $1.1 million of the Discount was amortized and a non-cash preferred dividend was recorded in the first quarter of 2012 and due to the conversion date occurring on April 17, 2012, the remaining $87.3 million of Discount amortization was accelerated to the conversion date and was fully amortized in the second quarter of 2012 as per the guidance of ASC 470. The Discount amortization is reflected as non-cash preferred dividend in the unaudited condensed consolidated statements of operations. In accordance with the guidance in ASC 480, the preferred dividend was charged against additional paid-in capital since no retained earnings were available.

        On December 6, 2012, the Company completed the Williston Basin Acquisition for a total adjusted purchase price of approximately $1.5 billion, consisting of approximately $785.8 million in cash and approximately $695.2 million in newly issued shares of Halcón preferred stock that automatically converted into 108.8 million shares of Halcón common stock (equivalent to a conversion price of approximately $7.45 per share of Halcón common stock), following stockholder approval on January 17, 2013 of such conversion and an amendment to Halcón's certificate of incorporation to increase the number of shares of common stock that Halcón is authorized to issue. The shares of preferred stock were issued to the Petro-Hunt Parties in a private placement pursuant to the exemptions from registration under Section 4(2) of the Securities Act of 1933, as amended.

        On January 17, 2013, the Company received the results from the special stockholders' meeting authorizing and approving the issuance of 108.8 million shares of common stock upon the conversion of the convertible preferred stock issued to the Petro-Hunt Parties. Following the approval by the stockholders, on January 18, 2013, each outstanding share of the Company's preferred stock converted into 10,000 shares of its common stock at an effective conversion price of approximately $7.45 per share. No proceeds were received by the Company upon conversion of the preferred stock. No cash dividends were paid on the preferred stock since pursuant to the terms of the Certificate of Designation of the preferred stock, conversion occurred prior to April 6, 2013. On June 13, 2013, the Company filed a Certificate of Elimination with the Delaware Secretary of State eliminating all provisions of the Certificate of Designation.

5.75% Series A Convertible Perpetual Preferred Stock

        On June 18, 2013, the Company completed its offering of 345,000 shares of its 5.75% Series A Convertible Perpetual Preferred Stock (the Series A Preferred Stock) at a public offering price of $1,000 per share (the Liquidation Preference). The Company filed a Certificate of Designations, Preferences, Rights and Limitations of 5.75% Series A Convertible Preferred Stock on June 17, 2013 (the Series A Designation). The net proceeds to the Company from the offering of the Series A Preferred Stock were approximately $335.5 million, after deducting the underwriting discount and offering expenses. The Company used the net proceeds from the offering to repay a portion of the outstanding borrowings under its Senior Credit Agreement.

        Holders of the Series A Preferred Stock are entitled to receive, when, as and if declared by the Company's Board of Directors, cumulative dividends at the rate of 5.75% per annum (the dividend rate) on the Liquidation Preference per share of the Series A Preferred Stock, payable quarterly in arrears on each dividend payment date. Dividends may be paid in cash or, where freely transferable by any non-affiliate recipient thereof, in common stock of the Company or a combination thereof, and are payable on March 1, June 1, September 1 and December 1 of each year, commencing on September 1, 2013. As of June 30, 2013, cumulative, undeclared dividends on the Series A Preferred Stock amounted to approximately $0.7 million.

        The Series A Preferred Stock has no maturity date, is not redeemable by the Company at any time, and will remain outstanding unless converted by the holders or mandatorily converted by the Company as described below.

        Each share of Series A Preferred Stock is convertible, at the holder's option at any time, initially into approximately 162.4431 shares of common stock of the Company (which is equivalent to an initial conversion price of approximately $6.16 per share), subject to specified adjustments as set forth in the Series A Designation. Based on the initial conversion rate, approximately 56.0 million shares of common stock of the Company would be issuable upon conversion of all the shares of Series A Preferred Stock.

        On or after June 6, 2018, the Company may, at its option, give notice of its election to cause all outstanding shares of the Series A Preferred Stock to be automatically converted into shares of common stock of the Company at the conversion rate (as defined in the Preliminary Prospectus Supplement), if the closing sale price of the Company's common stock equals or exceeds 150% of the conversion price for at least 20 trading days in a period of 30 consecutive trading days.

        If the Company undergoes a fundamental change (as defined in the Preliminary Prospectus Supplement) and a holder converts its shares of the Series A Preferred Stock at any time beginning at the opening of business on the trading day immediately following the effective date of such fundamental change and ending at the close of business on the 30th trading day immediately following such effective date, the holder will receive, for each share of the Series A Preferred Stock surrendered for conversion, a number of shares of common stock of the Company equal to the greater of: (1) the sum of (i) the conversion rate and (ii) the make-whole premium, if any, as described in the Series A Designation; and (2) the conversion rate which will be increased to equal (i) the sum of the $1,000 liquidation preference plus all accumulated and unpaid dividends to, but excluding, the settlement date for such conversion, divided by (ii) the average of the closing sale prices of the Company's common stock for the five consecutive trading days ending on the third business day prior to such settlement date; provided that the prevailing conversion rate as adjusted pursuant to this will not exceed 292.3977 shares of common stock of the Company per share of the Series A Preferred Stock (subject to adjustment in the same manner as the conversion rate).

        Except as required by Delaware law, holders of the Series A Preferred Stock will have no voting rights unless dividends are in arrears and unpaid for six or more quarterly periods. Until such arrearage is paid in full, the holders (voting as a single class with the holders of any other preferred shares having similar voting rights) will be entitled to elect two additional directors and the number of directors on the Company's Board of Directors will increase by that same number.

Common Stock

        On February 8, 2012 pursuant to the closing of the Recapitalization described in Note 2, "Recapitalization," the Company issued 73.3 million shares of the Company's common stock for a purchase price of $275.0 million. Costs incurred of $4.0 million were netted against the proceeds of the common stock and recorded accordingly. In addition, the Company amended its certificate of incorporation to increase the Company's authorized shares of common stock from 33.3 million shares to 336.7 million shares.

        In early August 2012, in connection with the Merger and the East Texas Acquisition, the Company issued 51.3 million and 20.8 million shares of common stock, respectively. The shares were issued at closing of the transactions as a portion of the consideration of the purchase price. See Note 4, "Acquisitions," for additional discussion on the issuance of common stock in connection with these transactions.

        On December 6, 2012, the Company completed the private placement of 41.9 million shares of common stock, par value $0.0001 per share, to CPP Investment Board PMI-2 Inc. (CPPIB), for gross proceeds of approximately $300.0 million, or $7.16 per share of common stock (the CPPIB Transaction). The net proceeds to the Company were $294.0 million following the payment of a $6.0 million capital commitment payment to CPPIB upon closing of the transaction. The shares of Halcón common stock were issued to CPPIB in a private placement pursuant to the exemptions from registration provided under Section 4(2) of the Securities Act.

        On January 17, 2013, with stockholder approval, the Company filed a Certificate of Amendment of the Amended and Restated Certificate of Incorporation with the Delaware Secretary of State to increase its authorized common stock by approximately 333.3 million shares for a total of 670.0 million authorized shares of common stock.

Warrants

        In February 2012, in conjunction with the issuance of the 2017 Notes, the Company issued the February 2012 Warrants to purchase 36.7 million shares of the Company's common stock at an exercise price of $4.50 per share of common stock pursuant to the Recapitalization described in Note 2, "Recapitalization." The Company allocated $43.6 million to the February 2012 Warrants which is reflected in additional paid-in capital in stockholders' equity, net of $0.6 million in issuance costs. The February 2012 Warrants entitle the holders to exercise the warrants in whole or in part at any time prior to the expiration date of February 8, 2017.

        In August 2012, as part of the Merger, the Company assumed outstanding GeoResources stock warrants. At the date of the Merger 0.6 million warrants were outstanding and converted to 1.2 million Halcón warrants (the August 2012 Warrants). Each GeoResources warrant was converted into an August 2012 Warrant to acquire one share of Halcón common stock (Share Portion) at an exercise price of $8.40 per share of common stock and the right to receive $20 in cash per equivalent assumed share (Cash Portion) at an exercise price of $0.82 per $1.00 received. The August 2012 Warrants contain substantially the same terms of the original GeoResources warrants with adjustments to the exercise price and addition of the Cash Portion to reflect the impact of the consideration per share from the Merger. These adjustments convert the terms to fundamentally equal what the warrant holders would have received had the warrants been exercised immediately prior to the close of the Merger. Under the terms of the August 2012 Warrants, the warrant holder must exercise the Share Portion and the Cash Portion in tandem. The August 2012 Warrants expired on June 9, 2013. The August 2012 Warrants were reflected as a current liability in the unaudited condensed consolidated balance sheets at December 31, 2012 and were recorded at fair value. During the three months ended June 30, 2013, the Company recorded a gain of $1.6 million for the expiration of the warrants. Changes in fair value and the gain upon expiration were recognized in "Interest expense and other" in the unaudited condensed consolidated statements of operations.

Incentive Plan

        On May 8, 2006, the Company's stockholders first approved its 2006 Long-Term Incentive Plan (the Plan). The Company reserved a maximum of 0.8 million shares of its common stock for issuances under the Plan. On May 8, 2008, the Plan was amended to increase the maximum authorized number of shares to be issued under the Plan from 0.8 million to 2.0 million. On May 3, 2010, the Plan was amended to increase the maximum authorized number of shares to be issued under the Plan from 2.0 million to 2.5 million. On February 8, 2012, as part of the Recapitalization described in Note 2, "Recapitalization," the Plan was amended to increase the maximum authorized number of shares to be issued under the Plan from 2.5 million to 3.7 million. On May 17, 2012, shareholders approved an amendment and restatement of the Plan to (i) increase the maximum number of shares to be issued under the Plan from 3.7 million to 11.5 million; (ii) extend the effectiveness of the Plan for ten years from the date of approval; and (iii) amend various other provisions of the Plan. On May 23, 2013, shareholders approved an increase in authorized shares under the Plan from 11.5 million to 41.5 million. As of June 30, 2013 and December 31, 2012, a maximum of 25.5 million and 4.4 million shares of common stock, respectively, remained reserved for issuance under the Plan.

        The Company accounts for share-based payment accruals under authoritative guidance on stock compensation, as set forth in ASC Topic 718. The guidance requires all share-based payments to employees and directors, including grants of stock options and restricted stock, to be recognized in the financial statements based on their fair values.

        For the three and six months ended June 30, 2013, the Company recognized $4.6 million and $7.0 million, respectively, of share-based compensation expense as a component of "General and administrative" on the unaudited condensed consolidated statements of operations. For the three and six months ended June 30, 2012, the Company recognized $0.5 million and $4.6 million, respectively, of share-based compensation expense.

Stock Options

        During the six months ended June 30, 2013, the Company granted stock options under the Plan covering 6.1 million shares of common stock to employees of the Company. The stock options have exercise prices ranging from $5.21 to $8.23 with a weighted average exercise price of $7.10. These awards typically vest over a three year period at a rate of one-third on the annual anniversary date of the grant and expire ten years from the grant date. At June 30, 2013, the Company had $19.5 million of unrecognized compensation expense related to non-vested stock options to be recognized over a weighted-average period of 1.5 years.

        During the six months ended June 30, 2012, the Company granted stock options covering approximately 1.3 million shares of common stock to employees of the Company. The stock options have exercise prices ranging from $8.73 to $11.55 with a weighted average price of $10.11. These awards vest over a three year period at a rate of one-third on the annual anniversary date of the grant and expire ten years from the grant date. At June 30, 2012, the Company had $4.8 million of unrecognized compensation expense related to non-vested stock options to be recognized over a weighted-average period of 1.8 years.

Restricted Stock

        During the six months ended June 30, 2013, the Company granted 3.2 million shares of restricted stock under the Plan to directors and employees of the Company. These restricted shares were granted at prices ranging from $5.15 to $7.65 with a weighted average price of $6.92. Employee shares vest over a three year period at a rate of one-third on the annual anniversary date of the grant, and the non-employee directors' shares vest six-months from the date of grant. At June 30, 2013, the Company had $18.1 million of unrecognized compensation expense related to non-vested restricted stock awards to be recognized over a weighted-average period of 1.5 years.

        During the six months ended June 30, 2012, the Company granted 0.2 million shares of restricted stock under the Plan to directors and employees of the Company. These restricted shares were granted at a price $10.13. Employee shares vest over a three year period at a rate of one-third on the annual anniversary date of the grant, and the non-employee directors' shares vest six-months from the date of grant. At June 30, 2012, the Company had $2.0 million of unrecognized compensation expense related to non-vested restricted stock awards to be recognized over a weighted-average period of 2.0 years.

        During the six months ended June 30, 2012, the Company incurred compensation expense of $2.6 million primarily from the accelerated vesting of all unvested employee restricted stock shares due to the change in control in the Company resulting from the Recapitalization as described in Note 2, "Recapitalization."

Stock Appreciation Rights

        During February 2012, the Company accelerated vesting and exercise of all unvested stock appreciation rights under the Plan (SARs) that were granted in May 2011, due to the change in control of the Company resulting from the Recapitalization described in Note 2, "Recapitalization." The Company settled the SARs in cash, resulting in $2.2 million of share-based compensation expense recognized for the six months ended June 30, 2012. The realized compensation expense was partially offset by the reversal of $0.8 million of unrealized losses recorded at December 31, 2011.

Treasury Stock

        As discussed above, during the six months ended June 30, 2013, the Company granted 3.2 million shares of restricted stock under the Plan to directors and employees of the Company of which 1.2 million shares were issued out of treasury stock. In addition, the Company retired 0.4 million shares from treasury stock representing shares that were repurchased for taxes tendered upon vesting of stock based compensation awards in prior years. As of June 30, 2013, the Company had no issued shares held in treasury.

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PREFERRED STOCK AND STOCKHOLDERS' EQUITY (Details) (USD $)	3 Months Ended	6 Months Ended		12 Months Ended	0 Months Ended	1 Months Ended				1 Months Ended			1 Months Ended			2 Months Ended	3 Months Ended			0 Months Ended			0 Months Ended	1 Months Ended		0 Months Ended	1 Months Ended				0 Months Ended	1 Months Ended	0 Months Ended	6 Months Ended
	Jun. 30, 2013	Jun. 30, 2013	Jun. 30, 2012	Dec. 31, 2012	Dec. 06, 2012 Private placement Stock Purchase Agreement CPPIB	Dec. 31, 2012 Private placement Stock Purchase Agreement CPPIB	Dec. 06, 2012 Williston Basin Assets	Jan. 18, 2013 Williston Basin Assets Petro-Hunt Parties	Aug. 02, 2012 GeoResources	Feb. 29, 2012 February 2012 Warrants	Aug. 30, 2012 GeoResources Warrants GeoResources	Aug. 30, 2012 August 2012 Warrants GeoResources	Apr. 30, 2012 Convertible Preferred Stock Private placement	Mar. 31, 2012 Convertible Preferred Stock Private placement	Feb. 29, 2012 Convertible Preferred Stock Private placement	Apr. 17, 2012 Convertible Preferred Stock Private placement	Jun. 30, 2012 Convertible Preferred Stock Private placement	Mar. 31, 2012 Convertible Preferred Stock Private placement	Mar. 05, 2012 Convertible Preferred Stock Private placement	Dec. 06, 2012 Convertible Preferred Stock Williston Basin Assets	Jan. 18, 2013 Convertible Preferred Stock Williston Basin Assets	Jan. 17, 2013 Convertible Preferred Stock Williston Basin Assets	Feb. 08, 2012 Common Stock	Feb. 29, 2012 Common Stock	Jan. 17, 2013 Common Stock	Apr. 17, 2012 Common Stock Private placement	Mar. 31, 2012 Common Stock Private placement	Mar. 28, 2012 Common Stock Private placement	Feb. 29, 2012 Common Stock Private placement	Jan. 17, 2013 Common Stock Williston Basin Assets	Aug. 02, 2012 Common Stock GeoResources	Aug. 31, 2012 Common Stock East Texas Assets	Jun. 18, 2013 5.75% Series A Convertible Perpetual Preferred Stock	Jun. 30, 2013 5.75% Series A Convertible Perpetual Preferred Stock item
Preferred stock and stockholders' equity
Shares issued					41,900,000										4,444.4511								73,300,000										345,000
Dividend rate (as a percent)		5.75%		5.75%											8.00%																			5.75%
Preferred stock, par value (in dollars per share)	$ 0.0001	$ 0.0001													$ 0.0001
Number of shares of common stock to be issued upon conversion																													10,000	108,800,000				162.4431
Share price (in dollars per share)					$ 7.16														$ 90,000							$ 10.99							$ 1,000
Gross proceeds from preferred stock offering			$ 311,556,000											$ 400,000,000
Placement agent fees														14,000,000
Other offering expenses														500,000
Par value of common stock (in dollars per share)	$ 0.0001	$ 0.0001		$ 0.0001	$ 0.0001																							$ 0.0001
Preferred stock converted into common stock (in shares)								108,800,000																		44,400,000
Conversion price per share (in dollars per share)																										$ 9.00	$ 9.00							$ 6.16
Benefit from conversion of stock (in dollars per share)													$ 1.99
Proceeds from the issuance of the Preferred Stock allocated to additional paid-in capital				88,445,000
Beneficial conversion feature, amortized upon conversion																88,400,000	87,300,000	1,100,000
Initial amortization period of beneficial conversion feature													71 months
Retained earnings	(231,910,000)	(231,910,000)	(246,300,000)	(274,463,000)
Purchase price							1,500,000,000		1,300,000,000
Cash purchase price							785,800,000		531,500,000
Preferred stock issued																						695,200,000
Preferred stock, conversion price (in dollars per share)																					$ 7.45	$ 7.45								$ 7.45
Liquidation preference per share (in dollars per share)																																		$ 1,000
Cumulative, undeclared dividends																																		700,000
Number of shares of common stock to be issued upon conversion at initial conversion rate																																		56,000,000
Closing sale price of common stock as minimum percentage of the conversion price to automatically convert preferred stock into common stock																																		150.00%
Minimum number of trading days within 30 consecutive trading days during which the closing sales price of common stock per share must exceed the conversion price for the preferred stocks to be redeemable																																		20
Number of consecutive trading day periods within which the closing sale price of common stock price per share must exceed the conversion price for at least 20 trading days for the preferred stocks to be redeemable																																		30 days
Number of trading days immediately following effective date of fundamental change within which holders will receive specified shares of common stock																																		30
Number of consecutive trading day periods ending on the third business day prior to settlement date																																		5 days
Number of shares of common stock to be issued upon conversion on fundamental change																																		292.3977
Threshold period of dividends in arrears and unpaid which will give holders of the Convertible Preferred Stock voting rights																																		18 months
Number of additional directors that can be appointed by holders of the Convertible Preferred Stock until arrearage is paid in full																																		2
Authorized shares of common stock, after amendment of certificate of incorporation	670,000,000	670,000,000		336,666,666																			336,700,000		670,000,000
Purchase price of common stock																							275,000,000
Payment for capital commitment		9,658,000	18,133,000			6,000,000				600,000														4,000,000
Authorized shares of common stock, before amendment of certificate of incorporation																							33,300,000
Shares issued																				10,880											51,300,000	20,800,000
Purchase price			275,000,000		300,000,000
Net proceeds received					294,000,000																												335,500,000
Increase in shares of common stock authorized																									333,300,000
Number of shares of common stock that can be purchased from warrants										36,700,000		1.00
Exercise price (in dollars per share)										$ 4.50		$ 8.40
Proceeds from issuance of warrants			43,590,000							43,600,000
Warrants outstanding											600,000	1,200,000
Cash Portion (in dollars per share)												$ 20
Cash exercise price per $1.00 received												$ 0.82
Gain on expiration of the warrants	$ 1,600,000

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CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) (USD $)	6 Months Ended	12 Months Ended
	Jun. 30, 2013	Dec. 31, 2012
Mezzanine equity:
Preferred stock, shares authorized		1,000,000
Preferred stock, par value (in dollars per share)		$ 0.0001
Preferred stock, shares issued	0	10,880
Preferred stock, shares outstanding	0	10,880
Preferred stock, dividend rate of Automatically Convertible (as a percent)		8.00%
Stockholders' equity:
Common stock, shares authorized	670,000,000	336,666,666
Common stock, par value (in dollars per share)	$ 0.0001	$ 0.0001
Common stock, shares issued	370,077,763	259,802,377
Common stock, shares outstanding	370,077,763	258,152,468
Preferred stock, shares authorized	1,000,000
Preferred stock, par value (in dollars per share)	$ 0.0001
Preferred stock, shares issued	345,000	0
Preferred stock, shares outstanding	345,000	0
Preferred stock, dividend rate of Cumulative Perpetual Convertible Series A (as a percent)	5.75%	5.75%
Treasury stock, shares	0	1,649,909

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ACQUISITIONS

6 Months Ended

Jun. 30, 2013

ACQUISITIONS

ACQUISITIONS

4. ACQUISITIONS

Williston Basin Assets

        On December 6, 2012, the Company completed the acquisition of two wholly-owned subsidiaries of Petro-Hunt Holdings, LLC and Pillar Holdings, LLC (the Petro-Hunt Parties), which owned acreage prospective for the Bakken / Three Forks formations located in North Dakota, in Williams, Montrail, McKenzie and Dunn counties (the Williston Basin Assets). The Company completed the acquisition of the Williston Basin Assets for total consideration of approximately $1.5 billion, consisting of approximately $785.8 million in cash and approximately 10,880 shares of the Company's preferred stock that automatically converted into 108.8 million shares of Halcón common stock on January 18, 2013 (equivalent to a conversion price of approximately $7.45 per share of Halcón common stock based on the liquidation preference), following stockholder approval of such conversion and an amendment to Halcón's certificate of incorporation to increase the number of shares of common stock that Halcón is authorized to issue (the Williston Basin Acquisition). The Williston Basin Acquisition significantly expanded the Company's presence in North Dakota, adding undeveloped acreage, oil and natural gas reserves and production to its existing asset base and operations in this area.

        The transaction had an effective date of June 1, 2012 and was subject to customary closing conditions, as well as the execution and delivery of certain other agreements, including a registration rights agreement. Under the terms of the registration rights agreement, as amended, Halcón agreed to file with the SEC on or before October 2, 2013, a shelf registration statement covering resales of the 108.8 million shares of Halcón common stock issued as partial consideration in the Williston Basin Acquisition and use commercially reasonable efforts to cause the registration statement to be declared effective as soon as reasonably practicable after the registration statement is filed.

GeoResources, Inc.

        On August 1, 2012, the Company completed an acquisition of GeoResources, Inc. (GeoResources) by means of the merger of GeoResources into a wholly-owned subsidiary of the Company (the Merger) and began reflecting GeoResources' results of operations in the Company's unaudited condensed consolidated statements of operations. In connection with the Merger, each share of GeoResources common stock issued and outstanding immediately prior to the effective date of the Merger was converted into the right to receive $20.00 in cash and 1.932 shares of the Company's common stock.

        In connection with the consummation of the Merger, the Company issued a total of approximately 51.3 million shares of its common stock and paid approximately $531.5 million in cash to former GeoResources stockholders in exchange for their shares of GeoResources common stock, resulting in a total purchase price plus liabilities assumed of approximately $1.3 billion. The acquisition expanded the Company's presence in the Bakken / Three Forks formations of North Dakota and Montana, and the Austin Chalk trend and Eagle Ford Shale in Texas, adding oil and natural gas reserves and production to its existing asset base in these areas.

East Texas Assets

        In August 2012, the Company completed the acquisition of oil and gas leaseholds in East Texas (the East Texas Assets) from CH4 Energy II, LLC, PetroMax Leon, LLC, Petro Texas LLC, King King LLC and several other selling parties for total consideration of $426.8 million comprised of $296.1 million in cash and 20.8 million shares of the Company's common stock (the East Texas Acquisition). The effective date of the East Texas Acquisition was April 1, 2012. The East Texas Acquisition expanded the Company's presence in East Texas, adding oil and natural gas reserves and production to its existing asset base in this area.

Pro Forma Impact of Acquisitions (Unaudited)

        As disclosed in the Company's Annual Report on Form 10-K for the year ended December 31, 2012, the acquisitions of the Williston Basin Assets and the East Texas Assets, as well as the Merger were accounted for as business combinations in accordance with Accounting Standards Codification (ASC) No. 805, Business Combinations (ASC 805) which, among other things, requires assets acquired and liabilities assumed to be measured at their acquisition date fair values. Certain assets and liabilities may be adjusted as additional information is obtained, but no later than one year from the respective acquisition dates. The purchase prices for the Williston Basin Assets, the East Texas Assets and the Merger are still preliminary due to the use of estimates based on information that was available to management. During the six months ended June 30, 2013, there were no adjustments to the purchase price of the East Texas Assets; however, there were minor adjustments to the respective purchase prices of GeoResources and the Williston Basin Assets related to accruals, settlements and working capital changes as a result of better information obtained during the period.

        The following unaudited pro forma combined results of operations are provided for the three and six months ended June 30, 2012 as though the Merger, the East Texas Acquisition and the Williston Basin Acquisition had been completed as of the beginning of the comparable prior annual reporting period, or January 1, 2011. The pro forma combined results of operations for the three and six months ended June 30, 2012 have been prepared by adjusting the historical results of the Company to include the historical results of GeoResources, the East Texas Assets and the Williston Basin Assets. These supplemental pro forma results of operations are provided for illustrative purposes only and do not purport to be indicative of the actual results that would have been achieved by the combined company for the period presented or that may be achieved by the combined company in the future. The pro forma results of operations do not include any cost savings or other synergies that resulted, or may result, from the Merger, the East Texas Acquisition and the Williston Basin Acquisition, or any estimated costs that will be incurred to integrate GeoResources, the Williston Basin Assets and the East Texas Assets. Future results may vary significantly from the results reflected in this unaudited pro forma financial information because of future events and transactions, as well as other factors.

        The Company's historical financial information was adjusted to give effect to the pro forma events that were directly attributable to the Merger, the East Texas Acquisition and the Williston Basin Acquisition, and that were factually supportable. Adjustments and assumptions made for this pro forma calculation are consistent with those used in the Company's annual pro forma information, as more fully described in Item 8. Consolidated Financial Statements and Supplementary Data—Note 5, "Acquisitions and Divestitures" to the Company's Annual Report on Form 10-K for the year ended December 31, 2012.

(In thousands, except per share amounts)	Three Months Ended June 30, 2012 (Unaudited)			Six Months Ended June 30, 2012 (Unaudited)
Revenue	$	151,738		$	278,315
Net income		49,234			30,494
Loss available to Halcón common stockholders		(38,109	)		(57,951	)
Pro forma net loss per common share:
Basic	$	(0.12	)	$	(0.20	)
Diluted	$	(0.12	)	$	(0.20	)

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ACQUISITIONS (Tables) (GeoResources, East Texas Assets and Williston Basin Assets)

6 Months Ended

Jun. 30, 2013

GeoResources, East Texas Assets and Williston Basin Assets

Acquisition

Schedule of pro forma financial information

(In thousands, except per share amounts)	Three Months Ended June 30, 2012 (Unaudited)			Six Months Ended June 30, 2012 (Unaudited)
Revenue	$	151,738		$	278,315
Net income		49,234			30,494
Loss available to Halcón common stockholders		(38,109	)		(57,951	)
Pro forma net loss per common share:
Basic	$	(0.12	)	$	(0.20	)
Diluted	$	(0.12	)	$	(0.20	)

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EARNINGS PER COMMON SHARE (Details) (USD $) In Thousands, except Share data, unless otherwise specified	3 Months Ended		6 Months Ended
	Jun. 30, 2013	Jun. 30, 2012	Jun. 30, 2013	Jun. 30, 2012
Basic:
Net income (loss) available to common stockholders	$ 36,372	$ (79,684)	$ 41,837	$ (114,108)
Weighted average basic number of common shares outstanding	366,712,000	136,066,000	356,482,000	102,441,000
Basic net income (loss) per share of common stock (in dollars per share)	$ 0.10	$ (0.59)	$ 0.12	$ (1.11)
Diluted:
Net income (loss) available to common stockholders	36,372	(79,684)	41,837	(114,108)
Interest on convertible debt, net	974		1,974
Net income (loss) available to common stockholders after assumed conversions	$ 37,346	$ (79,684)	$ 43,811	$ (114,108)
Weighted average basic number of common shares outstanding	366,712,000	136,066,000	356,482,000	102,441,000
Common stock equivalent shares representing shares issuable upon exercise of Febuary 2012 Warrants	9,954,000		12,183,000
Common stock equivalent shares representing shares included upon vesting of restricted shares	108,000		682,000
Common stock equivalent shares representing shares issuable upon conversion of 2017 Notes	64,371,000		32,185,000
Common stock equivalent shares representing shares issuable upon conversion of preferred stock			10,880,000
Weighted average diluted number of common shares outstanding	441,145,000	136,066,000	412,412,000	102,441,000
Diluted net income (loss) per share of common stock	$ 0.08	$ (0.59)	$ 0.11	$ (1.11)
Common stock equivalents not included in the computations of diluted earnings per share of common stock as their effect would have been anti-dilutive
Stock options not included in the computations of diluted earnings per share of common stock as their effect would have been anti-dilutive (in shares)	17,100,000	89,400,000	43,900,000	75,400,000

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INCOME TAXES

6 Months Ended

Jun. 30, 2013

INCOME TAXES

INCOME TAXES

12. INCOME TAXES

        Under guidance contained in Topic 740 of the ASC, deferred taxes are determined by applying the provisions of enacted tax laws and rates for the jurisdictions in which the Company operates to the estimated future tax effects of the differences between the tax basis of assets and liabilities and their reported amounts in the Company's financial statements. A valuation allowance is established to reduce deferred tax assets if it is more likely than not that the related tax benefits will not be realized.

        The Company estimates its annual effective income tax rate in recording its quarterly provision for income taxes in the various jurisdictions in which the Company operates. Statutory tax rate changes and other significant or unusual items are recognized as discrete items in the quarter in which they occur. At June 30, 2013 and December 31, 2012, the Company analyzed and made no adjustment to the valuation allowance.

        As of June 30, 2013, the Company has calculated an estimated annual tax rate of 38.3%. The estimated annual rate differs from the statutory federal income tax rate primarily due to the estimate of state income taxes for the period and nondeductible interest expense on the 2017 Note issued as part of the Recapitalization in February 2012. Based on the estimated effective annual tax rate, the Company recorded a tax provision of $26.4 million on pre-tax income of $69.0 million for the six months ended June 30, 2013. For the six months ended June 30, 2012, the Company recorded a tax provision of $0.2 million on a pre-tax loss of $25.5 million. The effective tax rate for the six months ending June 30, 2013 was 38.3% compared to 0.8% for the six months ending June 30, 2012. The change in effective tax rate is primarily due to the increase in pre-tax income in the current year and the impact of federal income tax limitations on the deductibility of interest expense on the 2017 Note issued as part of the Recapitalization in February 2012.

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DERIVATIVE AND HEDGING ACTIVITIES (Details) (USD $)																										1 Months Ended	3 Months Ended
	Jun. 30, 2013	Dec. 31, 2012	Jun. 30, 2013 Derivatives not designated as hedging contracts	Dec. 31, 2012 Derivatives not designated as hedging contracts	Jun. 30, 2013 Derivatives not designated as hedging contracts Commodity contracts item	Dec. 31, 2012 Derivatives not designated as hedging contracts Commodity contracts item	Jun. 30, 2013 Derivatives not designated as hedging contracts Commodity contracts Current assets - receivables from derivative contracts	Dec. 31, 2012 Derivatives not designated as hedging contracts Commodity contracts Current assets - receivables from derivative contracts	Jun. 30, 2013 Derivatives not designated as hedging contracts Commodity contracts Other noncurrent assets - receivables from derivative contracts	Dec. 31, 2012 Derivatives not designated as hedging contracts Commodity contracts Other noncurrent assets - receivables from derivative contracts	Jun. 30, 2013 Derivatives not designated as hedging contracts Commodity contracts Current liabilities - liabilities from derivative contracts	Dec. 31, 2012 Derivatives not designated as hedging contracts Commodity contracts Current liabilities - liabilities from derivative contracts	Dec. 31, 2012 Derivatives not designated as hedging contracts Commodity contracts Other noncurrent liabilities - liabilities from derivative contracts	Jun. 30, 2013 Derivatives not designated as hedging contracts Commodity contracts Collars Natural gas item	Dec. 31, 2012 Derivatives not designated as hedging contracts Commodity contracts Collars Natural gas item	Jun. 30, 2013 Derivatives not designated as hedging contracts Commodity contracts Collars Crude oil item	Dec. 31, 2012 Derivatives not designated as hedging contracts Commodity contracts Collars Crude oil item	Jun. 30, 2013 Derivatives not designated as hedging contracts Commodity contracts Swaps Natural gas item	Dec. 31, 2012 Derivatives not designated as hedging contracts Commodity contracts Swaps Natural gas item	Jun. 30, 2013 Derivatives not designated as hedging contracts Commodity contracts Swaps Crude oil item	Dec. 31, 2012 Derivatives not designated as hedging contracts Commodity contracts Swaps Crude oil item	Dec. 31, 2012 Derivatives not designated as hedging contracts Commodity contracts Basis Swap Natural gas item	Jun. 30, 2013 Derivatives not designated as hedging contracts Commodity contracts Three-way collars Crude oil item	Dec. 31, 2012 Derivatives not designated as hedging contracts Commodity contracts Three-way collars Crude oil item	Jun. 30, 2013 Derivatives not designated as hedging contracts Commodity contracts Put options Crude oil item	Feb. 29, 2012 Derivatives not designated as hedging contracts Senior Credit Agreement Commodity contracts	Mar. 31, 2012 Derivatives not designated as hedging contracts Senior Credit Agreement Interest rate swaps
Derivative and hedging activities
Realized loss for novation fees																										$ 400,000
Realized loss from termination of interest rate derivatives																											600,000
Number of open commodity derivative contracts					73	47								16	2	46	28	1	2	4	4	1	5	10	1
Asset derivative contracts	20,635,000	7,799,000	20,635,000	7,799,000			9,336,000	7,428,000	11,299,000	371,000
Liability derivative contracts	$ (5,198,000)	$ (12,890,000)	$ (5,198,000)	$ (12,890,000)							$ (5,198,000)	$ (10,429,000)	$ (2,461,000)

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ADDITIONAL FINANCIAL STATEMENT INFORMATION (Details) (USD $) In Thousands, unless otherwise specified	Jun. 30, 2013	Dec. 31, 2012
Accounts receivable:
Oil, natural gas and natural gas liquids revenues	$ 126,193	$ 143,794
Joint interest accounts	133,334	113,671
Affiliated partnerships	386	475
Other	4,303	4,869
Total	264,216	262,809
Prepaids and other:
Prepaids	6,712	3,690
Other	6,256	3,001
Total	12,968	6,691
Other noncurrent assets:
Deposits for acquisitions of oil and natural gas properties	36,855
Other	277	934
Total	37,132	934
Accounts payable and accrued liabilities:
Trade payables	127,324	147,679
Accrued oil and natural gas capital costs	358,973	282,245
Revenues and royalties payable	133,736	91,761
Accrued interest expense	52,164	45,201
Accrued income taxes payable	4	130
Accrued employee compensation	13,328	12,321
Drilling advances from partners	20,205	8,840
Accounts Payable to affiliated partnerships	83	822
Other		1,552
Total	$ 705,817	$ 590,551

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ACQUISITIONS (Details 4) (USD $) In Thousands, except Per Share data, unless otherwise specified	3 Months Ended		6 Months Ended
	Jun. 30, 2013	Jun. 30, 2012	Jun. 30, 2013	Jun. 30, 2012
Pro forma financial information
Loss available to Halcon common stockholders	$ 36,372	$ (79,684)	$ 41,837	$ (114,108)
Merger, East Texas Acquisition and Williston Basin Acquisition
Pro forma financial information
Revenue		151,738		278,315
Net income		49,234		30,494
Loss available to Halcon common stockholders		$ (38,109)		$ (57,951)
Pro forma net loss per common share:
Basic (in dollars per share)		$ (0.12)		$ (0.20)
Diluted (in dollars per share)		$ (0.12)		$ (0.20)

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DERIVATIVE AND HEDGING ACTIVITIES (Tables)

6 Months Ended

Jun. 30, 2013

DERIVATIVE AND HEDGING ACTIVITIES

Summary of location and fair value of derivative contracts

		Asset derivative contracts					Liability derivative contracts
Derivatives not designated as hedging contracts under ASC 815	Balance sheet location	June 30, 2013		December 31, 2012		Balance sheet location	June 30, 2013			December 31, 2012
		(In thousands)					(In thousands)
Commodity contracts	Current assets—receivables from derivative contracts	$	9,336	$	7,428	Current liabilities—liabilities from derivative contracts	$	(5,198	)	$	(10,429	)
Commodity contracts	Other noncurrent assets—receivables from derivative contracts		11,299		371	Other noncurrent liabilities—liabilities from derivative contracts		—			(2,461	)
Total derivatives not designated as hedging contracts under ASC 815		$	20,635	$	7,799		$	(5,198	)	$	(12,890	)

Summary of the location and amounts of the Company's realized and unrealized gains and losses on derivative contracts

		Amount of gain or (loss) recognized in income on derivative contracts for the Three Months Ended June 30,					Amount of gain or (loss) recognized in income on derivative contracts for the Six Months Ended June 30,
	Location of gain or (loss) recognized in income on derivative contracts
Derivatives not designated as hedging contracts under ASC 815		2013			2012		2013			2012
		(In thousands)					(In thousands)
Commodity contracts:
Unrealized gain (loss) on commodity contracts	Other income (expenses)—net gain (loss) on derivative contracts	$	34,515		$	12,638	$	17,716		$	7,176
Realized gain (loss) on commodity contracts	Other income (expenses)—net gain (loss) on derivative contracts		(415	)		1,033		(2,038	)		1,608
Total net gain (loss) on commodity contracts		$	34,100		$	13,671	$	15,678		$	8,784
Interest rate swaps:
Unrealized gain (loss) on interest rate swaps	Other income (expenses)—net gain (loss) on derivative contracts	$	—		$	—	$	—		$	518
Realized gain (loss) on interest rate swaps	Other income (expenses)—net gain (loss) on derivative contracts		—			—		—			(576	)
Total net gain (loss) on interest rate swaps		$	—		$	—	$	—		$	(58	)
Total net gain (loss) on derivative contracts	Other income (expenses)—net gain (loss) on derivative contracts	$	34,100		$	13,671	$	15,678		$	8,726

Schedule of open derivative contracts

			June 30, 2013
					Floors				Ceilings				Put Options Sold
Period	Instrument	Commodity	Volume in Mmbtu's/ Bbl's		Price / Price Range		Weighted Average Price		Price / Price Range		Weighted Average Price		Price / Price Range		Weighted Average Price
July 2013 - September 2013	Collars	Crude Oil		147,200	$	95.00	$	95.00	$	99.00 - 101.50	$	99.94
July 2013 - December 2013	Collars	Crude Oil		3,862,500		80.00 - 100.00		89.70		91.65 - 107.25		98.28
July 2013 - December 2013	Collars	Natural Gas		4,324,000		3.50 - 4.00		3.78		3.95 - 4.49		4.26
July 2013 - December 2013	Swaps	Crude Oil		180,000		97.60 - 105.55		102.18
July 2013 - December 2013	Swaps	Natural Gas		120,000		3.56		3.56
September 2013 - December 2013	Collars	Crude Oil		183,000		90.00		90.00		100.10		100.10
October 2013 - December 2013	Collars	Crude Oil		142,600		95.00		95.00		99.00 - 101.00		99.71
October 2013 - December 2013	Collars	Natural Gas		460,000		3.75		3.75		4.35		4.35
January 2014 - March 2014	Three-Way Collars	Crude Oil		144,000		95.00		95.00		98.60 - 109.50		100.03		70.00		70.00
January 2014 - June 2014	Collars	Crude Oil		724,000		90.00		90.00		96.50 - 99.50		98.00
April 2014 - June 2014	Three-Way Collars	Crude Oil		136,500		95.00		95.00		98.20 - 101.00		99.13		70.00		70.00
January 2014 - December 2014	Collars	Crude Oil		5,840,000		85.00 - 90.00		87.97		93.60 - 96.35		95.14
January 2014 - December 2014	Collars	Natural Gas		11,862,500		3.75 - 4.00		3.88		4.26 - 4.55		4.36
July 2014 - December 2014	Collars	Natural Gas		920,000		4.00		4.00		4.42		4.42
July 2014 - December 2014	Put	Crude Oil		184,000										90.00		90.00
January 2015 - December 2015	Collars	Natural Gas		6,387,500		4.00		4.00		4.55 - 4.85		4.68

			December 31, 2012
					Floors				Ceilings				Put Options Sold
Period	Instrument	Commodity	Volume in Mmbtu's/ Bbl's		Price / Price Range		Weighted Average Price		Price / Price Range		Weighted Average Price		Price / Price Range		Weighted Average Price
January 2013 - March 2013	Three-Way Collars	Crude Oil		130,500	$	95.00 - 100.00	$	95.34	$	105.50 - 109.50	$	101.36	$	70.00	$	70.00
January 2013 - March 2013	Basis Swaps	Natural Gas		225,000
January 2013 - March 2013	Collars	Crude Oil		31,500		95.00		95.00		101.50		101.50
January 2013 - March 2013	Swaps	Natural Gas		225,000		4.85		4.85
April 2013 - June 2013	Three-Way Collars	Crude Oil		120,575		95.00		95.00		99.50 - 100.60		99.77		70.00		70.00
April 2013 - June 2013	Collars	Crude Oil		29,575		95.00		95.00		100.60		100.60
July 2013 - September 2013	Collars	Crude Oil		147,200		95.00		95.00		99.00 - 101.50		99.94
October 2013 - December 2013	Collars	Crude Oil		142,600		95.00		95.00		99.00 - 101.00		99.71
January 2013 - December 2013	Collars	Crude Oil		5,201,250		80.00 - 100.00		89.04		91.65 - 107.25		98.06
January 2013 - December 2013	Collars	Natural Gas		1,825,000		3.75		3.75		4.26		4.26
January 2013 - December 2013	Swaps	Natural Gas		240,000		3.56		3.56
January 2013 - December 2013	Swaps	Crude Oil		360,000		97.60 - 105.55		102.18
February 2013 - December 2013	Collars	Crude Oil		250,500		100.00		100.00		104.15		104.15
April 2014 - June 2014	Three-Way Collars	Crude Oil		136,500		95.00		95.00		98.20 - 101.00		99.13		70.00		70.00
January 2014 - March 2014	Three-Way Collars	Crude Oil		144,000		95.00		95.00		98.60 - 109.50		100.03		70.00		70.00
January 2014 - December 2014	Collars	Crude Oil		2,190,000		85.00		85.00		95.10 - 96.35		95.92
January 2014 - December 2014	Collars	Natural Gas		1,825,000		3.75		3.75		4.26		4.26

Schedule of potential effects of master netting arrangements on the fair value of derivative contracts

	Derivative Assets						Derivative Liabilities
Offsetting of Derivative Assets and Liabilities	June 30, 2013			December 31, 2012			June 30, 2013			December 31, 2012
	(In thousands)						(In thousands)
Gross amounts presented in the consolidated balance sheet	$	20,635		$	7,799		$	(5,198	)	$	(12,890	)
Amounts not offset in the consolidated balance sheet		(3,506	)		(4,118	)		3,414			3,899
Net amount	$	17,129		$	3,681		$	(1,784	)	$	(8,991	)

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FAIR VALUE MEASUREMENTS (Tables)

6 Months Ended

Jun. 30, 2013

FAIR VALUE MEASUREMENTS

Schedule of fair value of the Company's financial assets and liabilities

	June 30, 2013
	Level 1		Level 2		Level 3		Total
	(In thousands)
Assets
Receivables from derivative contracts	$	—	$	20,635	$	—	$	20,635
Liabilities
Liabilities from derivative contracts	$	—	$	5,198	$	—	$	5,198

	December 31, 2012
	Level 1		Level 2		Level 3		Total
	(In thousands)
Assets
Receivables from derivative contracts	$	—	$	7,799	$	—	$	7,799
Liabilities
Liabilities from derivative contracts	$	—	$	12,890	$	—	$	12,890
Liabilities from warrants(1)		—		1,342		—		1,342
Total Liabilities	$	—	$	14,232	$	—	$	14,232

⁽¹⁾

Liabilities from August 2012 warrants are recorded in "Accounts payable and accrued liabilities" on the unaudited condensed consolidated balance sheets.

Schedule of the estimated fair values of the Company's fixed interest rate, long-term debt instruments

	June 30, 2013				December 31, 2012
Debt	Carrying Amount		Estimated Fair Value		Carrying Amount		Estimated Fair Value
	(In thousands)
8.875% $1.35 billion senior notes	$	1,350,000	$	1,316,250	$	750,000	$	798,750
9.75% $750 million senior notes		750,000		753,750		750,000		815,160
8.0% $275 million convertible note		289,669		462,655		289,669		625,425
	$	2,389,669	$	2,532,655	$	1,789,669	$	2,239,335

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FAIR VALUE MEASUREMENTS (Details) (USD $)	3 Months Ended		6 Months Ended
	Jun. 30, 2013	Mar. 31, 2013	Jun. 30, 2013	Jun. 30, 2013 Recurring Level 2	Dec. 31, 2012 Recurring Level 2	Jun. 30, 2013 Recurring Total	Dec. 31, 2012 Recurring Total
FAIR VALUE MEASUREMENTS
Asset transfers between levels			$ 0
Liability transfers between levels			0
Assets
Receivables from derivative contracts				20,635,000	7,799,000	20,635,000	7,799,000
Liabilities
Liabilities from derivative contracts				5,198,000	12,890,000	5,198,000	12,890,000
Liabilities from warrants					1,342,000		1,342,000
Total Liabilities					14,232,000		14,232,000
Unrealized gain recorded to reflect the change in fair value of warrants		300,000
Gain on expiration of the warrants	$ 1,600,000

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RESTRUCTURING (Details) (USD $)	3 Months Ended		6 Months Ended		3 Months Ended	6 Months Ended
	Jun. 30, 2013	Jun. 30, 2012	Jun. 30, 2013	Jun. 30, 2012	Mar. 31, 2012 Severance Program	Jun. 30, 2013 Severance Program
Restructuring
Estimated expense					$ 2,900,000
Restructuring liability
Beginning balance						2,131,000
Severance and retention payments						(2,627,000)
Increase in accrual	$ (164,000)	$ 903,000	$ 507,000	$ 1,007,000		$ 496,000

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LONG-TERM DEBT (Details) (USD $)					0 Months Ended							1 Months Ended					0 Months Ended
	Jun. 30, 2013	Dec. 31, 2012	Jun. 30, 2013 Senior revolving credit facility	Dec. 31, 2012 Senior revolving credit facility	Jan. 14, 2013 8.875% Senior Notes	Jun. 30, 2013 8.875% Senior Notes	Dec. 31, 2012 8.875% Senior Notes	Nov. 06, 2012 8.875% Senior Notes	Jun. 30, 2013 9.75% Senior Notes	Dec. 31, 2012 9.75% Senior Notes	Jul. 16, 2012 9.75% Senior Notes	Feb. 28, 2012 8% convertible Note	Jun. 30, 2013 8% convertible Note	Dec. 31, 2012 8% convertible Note	Feb. 08, 2012 8% convertible Note	Dec. 31, 2012 Promissory Notes	Jan. 14, 2013 Additional 2021 Notes	Jun. 30, 2013 Additional 2021 Notes
Long-term debt
Long-term debt	$ 2,713,947,000	$ 2,034,498,000	$ 343,000,000	$ 298,000,000		$ 1,373,429,000	$ 744,421,000		$ 740,669,000	$ 740,232,000			$ 255,460,000	$ 251,845,000
Deferred premiums on derivative contracts	1,389,000
Interest rate (as a percent)					8.875%	8.875%	8.875%	8.875%	9.75%	9.75%	9.75%		8.00%	8.00%	8.00%
Principal amount						1,350,000,000	1,350,000,000	750,000,000	750,000,000	750,000,000	750,000,000		275,000,000	275,000,000	275,000,000
Long-term debt, current		74,669,000														74,700,000
Unamortized discount						5,400,000	5,600,000	5,700,000	9,300,000	9,800,000	10,200,000		34,200,000	37,800,000	43,600,000
Principal amount of debt issued					600,000,000							275,000,000					600,000,000
Unamortized premium related to debt issued																	$ 30,000,000	$ 28,800,000

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DERIVATIVE AND HEDGING ACTIVITIES (Details 2) (USD $) In Thousands, unless otherwise specified	3 Months Ended		6 Months Ended
	Jun. 30, 2013	Jun. 30, 2012	Jun. 30, 2013	Jun. 30, 2012
Derivative and hedging activities
Total net gain (loss) on derivative contracts	$ 34,100	$ 13,671	$ 15,678	$ 8,726
Derivatives not designated as hedging contracts
Derivative and hedging activities
Total net gain (loss) on derivative contracts	34,100	13,671	15,678	8,726
Derivatives not designated as hedging contracts | Commodity contracts
Derivative and hedging activities
Unrealized gain (loss)	34,515	12,638	17,716	7,176
Realized gain (loss)	(415)	1,033	(2,038)	1,608
Total net gain (loss) on derivative contracts	34,100	13,671	15,678	8,784
Derivatives not designated as hedging contracts | Interest rate swaps
Derivative and hedging activities
Unrealized gain (loss)				518
Realized gain (loss)				(576)
Total net gain (loss) on derivative contracts				$ (58)

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FINANCIAL STATEMENT PRESENTATION (Details) (USD $)	Jun. 30, 2013	Dec. 31, 2012	Jun. 30, 2012	Dec. 31, 2011
Corrections of immaterial errors
Accumulated deficit	$ 231,910,000	$ 274,463,000	$ 246,300,000
Stockholder's equity	2,481,825,000	1,397,982,000	676,600,000	1,680,000
As previously reported
Corrections of immaterial errors
Accumulated deficit			242,000,000
Stockholder's equity			680,900,000
Correction in tax basis | Restatement adjustment
Corrections of immaterial errors
Oil and natural gas properties and deferred income taxes				$ 4,300,000

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LONG-TERM DEBT (Details 4) (8.0% Convertible Note, USD $) In Millions, except Per Share data, unless otherwise specified	3 Months Ended
	Sep. 30, 2012	Jun. 30, 2012	Mar. 31, 2012	Jun. 30, 2013	Dec. 31, 2012	Feb. 08, 2012
8.0% Convertible Note
Long-term debt
Principal amount				$ 275.0	$ 275.0	$ 275.0
Interest rate (as a percent)				8.00%	8.00%	8.00%
Pay in-kind interest	5.8	5.7	3.2
Principal outstanding				289.7
Amount of principal and accrued interest that is convertible into one share of the entity's common stock (in dollars per share)						$ 4.50
Unamortized discount				$ 34.2	$ 37.8	$ 43.6

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LONG-TERM DEBT (Tables)

6 Months Ended

Jun. 30, 2013

LONG-TERM DEBT

Schedule of long-term debt

	June 30, 2013		December 31, 2012(1)
	(In thousands)
Senior revolving credit facility	$	343,000	$	298,000
8.875% $1.35 billion senior notes(2)		1,373,429		744,421
9.75% $750 million senior notes(3)		740,669		740,232
8.0% $275 million convertible note(4)		255,460		251,845
Deferred premiums on derivative contracts		1,389		—
	$	2,713,947	$	2,034,498

⁽¹⁾

Table excludes $74.7 million of promissory notes which were classified as current at December 31, 2012.

⁽²⁾

Amount is net of a $5.4 million and a $5.6 million unamortized discount at June 30, 2013 and December 31, 2012, respectively, related to the issuance of the original 2021 Notes. On January 14, 2013, the Company completed the issuance of an additional $600 million of its 2021 Notes. The unamortized premium related to these additional 2021 Notes was approximately $28.8 million at June 30, 2013. See "8.875% Senior Notes" below for more details.

⁽³⁾

Amount is net of a $9.3 million and a $9.8 million unamortized discount at June 30, 2013 and December 31, 2012, respectively. See "9.75% Senior Notes" below for more details.

⁽⁴⁾

Amount is net of a $34.2 million and a $37.8 million unamortized discount at June 30, 2013 and December 31, 2012, respectively. See "8.0% Convertible Note" below for more details.

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CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (USD $) In Thousands, unless otherwise specified	6 Months Ended		12 Months Ended
	Jun. 30, 2013	Jun. 30, 2012	Dec. 31, 2012
Cash flows from operating activities:
Net income (loss)	$ 42,553	$ (25,663)	$ (53,885)
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities:
Depletion, depreciation and accretion	177,173	11,935
Deferred income tax provision (benefit)	21,305	136
Share-based compensation, net	6,975	2,465
Unrealized loss (gain) on derivative contracts	(19,139)	(8,036)
Amortization and write-off of deferred loan costs	508	6,299
Non-cash interest and amortization of discount and premium	1,054	7,733
Other income	(2,912)	(17)
Change in assets and liabilities, net of acquisitions:
Accounts receivable	(52,686)	948
Inventory	(768)	(167)
Prepaids and other	(5,438)	(1,841)
Accounts payable and accrued liabilities	61,265	3,500
Net cash provided by (used in) operating activities	229,890	(2,708)
Cash flows from investing activities:
Oil and natural gas capital expenditures	(1,024,488)	(468,197)
Other operating property and equipment capital expenditures	(80,718)	(3,573)
Acquisition of Williston Basin Assets	(29,739)
Funds held in escrow and other	(30,805)	(29,039)
Net cash used in investing activities	(1,165,750)	(500,809)
Cash flows from financing activities:
Proceeds from borrowings	1,528,000	237,410
Repayments of borrowings	(915,400)	(208,000)
Debt issuance costs	(11,527)	(5,053)
Offering costs	(9,658)	(18,133)
Common stock repurchased		(2,139)
Series A preferred stock issued	345,000
Preferred stock issued		311,556
Preferred beneficial conversion feature		88,445
Common stock issued		275,000
Warrants issued		43,590
Net cash provided by financing activities	936,415	722,676
Net increase (decrease) in cash	555	219,159
Cash at beginning of period	2,506	49	49
Cash at end of period	$ 3,061	$ 219,208	$ 2,506

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RECAPITALIZATION

6 Months Ended

Jun. 30, 2013

RECAPITALIZATION

RECAPITALIZATION

2. RECAPITALIZATION

        On December 21, 2011, the Company entered into a Securities Purchase Agreement (the Purchase Agreement) with HALRES LLC, formerly Halcón Resources, LLC (HALRES). Pursuant to the Purchase Agreement, (i) HALRES purchased and the Company sold 73.3 million shares of the Company's common stock (the Shares) for a purchase price of $275 million and (ii) HALRES purchased and the Company issued a senior convertible promissory note in the principal amount of $275 million (the 2017 Note), together with five year warrants (the February 2012 Warrants) to purchase 36.7 million shares of the Company's common stock at an exercise price of $4.50 per share (the Recapitalization), subject to adjustment under certain circumstances. The 2017 Note is convertible after February 8, 2014 into 61.1 million shares of common stock at a conversion price of $4.50 per share, subject to adjustment under certain circumstances. The Company and HALRES closed the transaction contemplated by the Purchase Agreement on February 8, 2012.

        In January 2012, shareholders holding a majority of the Company's outstanding shares of common stock approved the issuance of the Shares, the 2017 Note and the February 2012 Warrants pursuant to the terms of the Purchase Agreement. Additionally, the Board of Directors approved, effective upon the closing (i) the amendment of the Company's certificate of incorporation to (a) increase the Company's authorized shares of common stock from 100 million shares to 1.01 billion shares, both of which were before the one-for-three reverse stock split; (b) a one-for-three reverse stock split of the Company's common stock (which reduced the Company's authorized shares of common stock from 1.01 billion to 336.7 million shares); and (c) a name change from RAM Energy Resources, Inc. to Halcón Resources Corporation; (ii) the amendment of the Company's 2006 Long-Term Incentive Plan (the Plan) to increase the number of shares that may be issued under the Plan from 2.5 million to 3.7 million shares; and (iii) on an advisory (non-binding) basis, the payments made to the Company's named executive officers in connection with the transactions contemplated by the Purchase Agreement.

        The closing of the transaction resulted in a change in control of the Company. Material events and items resulting from the transaction include the following:

• •

  completion of transactions contemplated by the Purchase Agreement and shareholder approval as discussed above;

  •

  the resignation and termination of the Company's four executive officers and the resignation of certain other officers;

  •

  change in control payments of $4.6 million to the officers of the Company recorded in general and administrative expense;

  •

  change in control payment of $0.8 million pursuant to a retainer agreement with the Company's then outside law firm recorded in general and administrative expense;

  •

  accelerated vesting of all unvested employee restricted stock shares and accelerated vesting and exercise of all unvested stock appreciation rights resulting in $4.3 million of share-based compensation expense recorded in general and administrative expense;

  •

  payoff and termination of the Company's March 2011 Credit Facilities of $133.0 million plus accrued interest, as well as the expensing of the related unamortized debt issuance costs of $2.9 million;

  •

  payoff and termination of the Company's second lien term facility of $75.0 million plus accrued interest and a prepayment fee of $1.5 million, as well as the expensing of the related unamortized debt issuance costs of $2.9 million; and

  •

  closing costs of $11.2 million related to engagement fees and various professional fees including $2.5 million recorded in general and administrative expense related to a termination fee pursuant to a previous engagement.

        In January 2012, the Company approved a one-for-three reverse stock split, which was implemented on February 10, 2012. Retroactive application of the reverse stock split is required and all share and per share information included for all periods presented in these unaudited condensed consolidated financial statements reflects the reverse stock split.

        In February 2012, the transaction with HALRES resulted in an "ownership change" as defined under Section 382 of the Internal Revenue Code of 1986, as amended. As a consequence, the Company has additional limitations on its ability to use the net operating losses it accrued before the ownership change as a deduction against any taxable income the Company realizes after the ownership change.

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OIL AND NATURAL GAS PROPERTIES

6 Months Ended

Jun. 30, 2013

OIL AND NATURAL GAS PROPERTIES

OIL AND NATURAL GAS PROPERTIES

5. OIL AND NATURAL GAS PROPERTIES

        The Company uses the full cost method of accounting for its investment in oil and natural gas properties. Under this method of accounting, all costs of acquisition, exploration and development of oil and natural gas reserves (including such costs as leasehold acquisition costs, geological expenditures, dry hole costs, tangible and intangible development costs and direct internal costs) are capitalized as the cost of oil and natural gas properties when incurred. To the extent capitalized costs of evaluated oil and natural gas properties, net of accumulated depletion, exceed the discounted future net revenues of proved oil and natural gas reserves, net of deferred taxes, such excess capitalized costs are charged to expense.

        The Company assesses all properties classified as unevaluated property on a quarterly basis for possible impairment or reduction in value. The Company assesses properties on an individual basis or as a group, if properties are individually insignificant. The assessment includes consideration of the following factors, among others: intent to drill; remaining lease term; geological and geophysical evaluations; drilling results and activity; the assignment of proved reserves; and the economic viability of development if proved reserves are assigned. During any period in which these factors indicate an impairment, the cumulative drilling costs incurred to date for such property and all or a portion of the associated leasehold costs are transferred to the full cost pool and are then subject to depletion and the full cost ceiling test limitation.

        Investments in unevaluated oil and natural gas properties and exploration and development projects for which depletion expense is not currently recognized, and for which exploration or development activities are in progress, qualify for interest capitalization. The capitalized interest is determined by multiplying the Company's weighted-average borrowing cost on debt by the average amount of qualifying costs incurred that are excluded from the full cost pool; however, the amount of capitalized interest cannot exceed the amount of gross interest expense incurred in any given period. The capitalized interest amounts are recorded as additions to unevaluated oil and natural gas properties on the unaudited condensed consolidated balance sheets. As the costs excluded are transferred to the full cost pool, the associated capitalized interest is also transferred to the full cost pool. For the three and six months ended June 30, 2013, the Company capitalized interest costs of $53.5 million and $106.4 million, respectively. For the three and six months ended June 30, 2012, the Company capitalized interest costs of $3.3 million and $3.4 million, respectively.

        At June 30, 2013 the ceiling test value of the Company's reserves was calculated based on the first day average of the 12-months ended June 30, 2013 of the West Texas Intermediate (WTI) spot price of $91.60 per barrel, adjusted by lease or field for quality, transportation fees, and regional price differentials, and the first day average of the 12-months ended June 30, 2013 of the Henry Hub price of $3.45 per million British thermal units (Mmbtu), adjusted by lease or field for energy content, transportation fees, and regional price differentials. Using these prices, the Company's net book value of oil and natural gas properties at June 30, 2013 did not exceed the ceiling amount. Changes in production rates, levels of reserves, future development costs, and other factors will determine the Company's actual ceiling test calculation and impairment analyses in future periods.

        At June 30, 2012 the ceiling test value of the Company's reserves was calculated based on the first day average of the 12-months ended June 30, 2012 of the WTI spot price of $95.67 per barrel, adjusted by lease or field for quality, transportation fees, and regional price differentials, and the first day average of the 12-months ended June 30, 2012 of the Henry Hub price of $3.15 per Mmbtu, adjusted by lease or field for energy content, transportation fees, and regional price differentials. Using these prices, the Company's net book value of oil and natural gas properties at June 30, 2012 did not exceed the ceiling amount.

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RESTRUCTURING

6 Months Ended

Jun. 30, 2013

RESTRUCTURING

RESTRUCTURING

3. RESTRUCTURING

        In March 2012, the Company announced its intention to close its Plano, Texas office and begin the process of relocating key administrative functions to Houston, Texas (the Restructuring). As part of the Restructuring, the Company offered certain severance and retention benefits, collectively known as the Severance Program, to the affected employees. The total expense of the Severance Program was approximately $2.9 million and related costs were recognized as restructuring expense over the requisite service periods through May 2013, as applicable. Following is a reconciliation of the beginning and ending liability balance.

	Severance Program
	(In thousands)
Ending balance, December 31, 2012	$	2,131
Severance and retention payments		(2,627	)
Increase in accrual		496
Ending balance, June 30, 2013	$	—

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LONG-TERM DEBT (Details 2) (USD $)	0 Months Ended			0 Months Ended		0 Months Ended			0 Months Ended			0 Months Ended			3 Months Ended
	Feb. 08, 2012 Senior revolving credit facility item	Jul. 19, 2013 Senior revolving credit facility	Jun. 30, 2013 Senior revolving credit facility	Feb. 08, 2012 Senior revolving credit facility Minimum	Jun. 30, 2013 Senior revolving credit facility Subsequent event	Feb. 08, 2012 Senior revolving credit facility ABR-based	Feb. 08, 2012 Senior revolving credit facility ABR-based Minimum	Feb. 08, 2012 Senior revolving credit facility ABR-based Maximum	Feb. 08, 2012 Senior revolving credit facility Euro-dollar based	Feb. 08, 2012 Senior revolving credit facility Euro-dollar based Minimum	Feb. 08, 2012 Senior revolving credit facility Euro-dollar based Maximum	Jan. 25, 2013 Second Amendment to the Senior Credit Agreement	Jan. 25, 2013 Second Amendment to the Senior Credit Agreement Minimum	Jan. 25, 2013 Second Amendment to the Senior Credit Agreement Maximum	Dec. 31, 2013 Fourth Amendment to the Senior Credit Agreement	Sep. 30, 2013 Fourth Amendment to the Senior Credit Agreement	Jun. 30, 2013 Fourth Amendment to the Senior Credit Agreement	Jul. 19, 2013 Adjustment Subsequent event
Long-term debt
Maximum borrowing capacity	$ 1,500,000,000
Current borrowing capacity		810,000,000	850,000,000		850,000,000													810,000,000
Number of interim unscheduled redeterminations of borrowing base to which the company and lender each have the right	1
Number of consecutive semi-annual redeterminations between which the company and the lenders each have the right to one interim unscheduled redetermination of borrowing base	2
Multiple applied to stated principal amount of any future notes or other long-term debt securities that the company may issue to calculate reduction in borrowing base	0.25
Credit facility term	5 years
Variable rate base						Base rate			LIBOR
Applicable margin (as a percent)							0.50%	1.50%		1.50%	2.50%
Working capital levels				1.0
Interest coverage ratio				2.5
Amount outstanding			343,000,000
Letters of credit outstanding			1,200,000
Borrowing capacity available			$ 505,800,000
Debt covenant, commodity hedging agreements, volume percentage														85.00%
Commodity hedging agreement, period one												24 months
Commodity hedging agreement, period two													25 months	66 months
Commodity hedging agreement, period three													25 months	48 months
EBITDA period utilized for calculation of Interest Coverage Ratio															9 months	6 months	3 months
EBITDA multiplier utilized for calculation of Interest Coverage Ratio															1.33	2	4

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ASSET RETIREMENT OBLIGATIONS (Tables)

6 Months Ended

Jun. 30, 2013

ASSET RETIREMENT OBLIGATIONS

Schedule of activity related to ARO liability

The Company recorded the following activity related to its ARO liability for the six months ended June 30, 2013 (in thousands, inclusive of the current portion):

Liability for asset retirement obligations as of December 31, 2012	$	75,132
Liabilities settled and divested		(265	)
Additions		5,037
Acquisitions		1,055
Accretion expense		1,825
Revisions in estimated cash flows		(433	)
Liability for asset retirement obligations as of June 30, 2013	$	82,351

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FINANCIAL STATEMENT PRESENTATION (Details 2) (USD $) In Millions, unless otherwise specified	6 Months Ended	12 Months Ended
	Jun. 30, 2013	Dec. 31, 2012
Basis of Presentation and Principles of Consolidation
Number of operating segments	1
Gas gathering systems and equipment
Other operating property and equipment
Estimated useful life	30 years
Cost capitalized	$ 112.0	$ 39.9
Automobiles
Other operating property and equipment
Estimated useful life	3 years
Computers
Other operating property and equipment
Estimated useful life	3 years
Computer software | Maximum
Other operating property and equipment
Estimated useful life	5 years
Leasehold improvements | Maximum
Other operating property and equipment
Estimated useful life	5 years
Fixtures, furniture and equipment | Maximum
Other operating property and equipment
Estimated useful life	5 years
Trailers
Other operating property and equipment
Estimated useful life	7 years
Heavy equipment
Other operating property and equipment
Estimated useful life	10 years
Airplane and buildings
Other operating property and equipment
Estimated useful life	20 years

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ACQUISITIONS (Details 3) (USD $)	6 Months Ended			1 Months Ended
	Jun. 30, 2013	Aug. 31, 2012 East Texas Assets As initially reported	Jun. 30, 2013 East Texas Assets Measurement Period Adjustments	Aug. 31, 2012 East Texas Assets Common stock
Acquisition
Total Consideration		$ 426,800,000
Cash consideration paid to sellers		296,100,000
Shares issued				20,800,000
Maximum period from acquisition date for the adjusting certain assets and liabilities acquired	1 year
Total purchase price plus liabilities assumed			$ 0

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INCOME TAXES (Details) (USD $)	3 Months Ended		6 Months Ended		12 Months Ended
	Jun. 30, 2013	Jun. 30, 2012	Jun. 30, 2013	Jun. 30, 2012	Dec. 31, 2012
INCOME TAXES
Valuation allowance adjustment amount			$ 0		$ 0
Effective income tax rate (as a percent)			38.30%	0.80%
Income tax provision	23,121,000	(5,387,000)	26,415,000	208,000
Pre-tax income (loss)			$ 69,000,000	$ (25,500,000)

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DERIVATIVE AND HEDGING ACTIVITIES (Details 3) (USD $) In Thousands, unless otherwise specified	Jun. 30, 2013	Dec. 31, 2012
Derivative Assets
Gross amounts presented in the consolidated balance sheet	$ 20,635	$ 7,799
Amounts not offset in the consolidated balance sheet	(3,506)	(4,118)
Net amount	17,129	3,681
Derivative Liabilities
Gross amounts presented in the consolidated balance sheet	(5,198)	(12,890)
Amounts not offset in the consolidated balance sheet	3,414	3,899
Net amount	$ (1,784)	$ (8,991)
January 2013 - March 2013 | 3 Way-collars | Commodity contracts | Crude oil
Derivative and hedging activities
Volume in Mmbtu's/Bbl's		130,500
Put Options Sold (in dollars per Mmbtu's/Bbl's)		70.00
January 2013 - March 2013 | 3 Way-collars | Commodity contracts | Crude oil | Minimum
Derivative and hedging activities
Floors (in dollars per Mmbtu's/Bbl's)		95.00
Ceilings (in dollars per Mmbtu's/Bbl's)		105.50
January 2013 - March 2013 | 3 Way-collars | Commodity contracts | Crude oil | Maximum
Derivative and hedging activities
Floors (in dollars per Mmbtu's/Bbl's)		100.00
Ceilings (in dollars per Mmbtu's/Bbl's)		109.50
January 2013 - March 2013 | 3 Way-collars | Commodity contracts | Crude oil | Weighted Average
Derivative and hedging activities
Floors (in dollars per Mmbtu's/Bbl's)		95.34
Ceilings (in dollars per Mmbtu's/Bbl's)		101.36
Put Options Sold (in dollars per Mmbtu's/Bbl's)		70.00
January 2013 - March 2013 | Basis Swap | Commodity contracts | Natural gas
Derivative and hedging activities
Volume in Mmbtu's/Bbl's		225,000
January 2013 - March 2013 | Collars | Commodity contracts | Crude oil
Derivative and hedging activities
Volume in Mmbtu's/Bbl's		31,500
Floors (in dollars per Mmbtu's/Bbl's)		95.00
Ceilings (in dollars per Mmbtu's/Bbl's)		101.50
January 2013 - March 2013 | Collars | Commodity contracts | Crude oil | Weighted Average
Derivative and hedging activities
Floors (in dollars per Mmbtu's/Bbl's)		95.00
Ceilings (in dollars per Mmbtu's/Bbl's)		101.50
January 2013 - March 2013 | Swaps | Commodity contracts | Natural gas
Derivative and hedging activities
Volume in Mmbtu's/Bbl's		225,000
Floors (in dollars per Mmbtu's/Bbl's)		4.85
January 2013 - March 2013 | Swaps | Commodity contracts | Natural gas | Weighted Average
Derivative and hedging activities
Floors (in dollars per Mmbtu's/Bbl's)		4.85
April 2013 - June 2013 | 3 Way-collars | Commodity contracts | Crude oil
Derivative and hedging activities
Volume in Mmbtu's/Bbl's		120,575
Floors (in dollars per Mmbtu's/Bbl's)		95.00
Put Options Sold (in dollars per Mmbtu's/Bbl's)		70.00
April 2013 - June 2013 | 3 Way-collars | Commodity contracts | Crude oil | Minimum
Derivative and hedging activities
Ceilings (in dollars per Mmbtu's/Bbl's)		99.50
April 2013 - June 2013 | 3 Way-collars | Commodity contracts | Crude oil | Maximum
Derivative and hedging activities
Ceilings (in dollars per Mmbtu's/Bbl's)		100.60
April 2013 - June 2013 | 3 Way-collars | Commodity contracts | Crude oil | Weighted Average
Derivative and hedging activities
Floors (in dollars per Mmbtu's/Bbl's)		95.00
Ceilings (in dollars per Mmbtu's/Bbl's)		99.77
Put Options Sold (in dollars per Mmbtu's/Bbl's)		70.00
April 2013 - June 2013 | Collars | Commodity contracts | Crude oil
Derivative and hedging activities
Volume in Mmbtu's/Bbl's		29,575
Floors (in dollars per Mmbtu's/Bbl's)		95.00
Ceilings (in dollars per Mmbtu's/Bbl's)		100.60
April 2013 - June 2013 | Collars | Commodity contracts | Crude oil | Weighted Average
Derivative and hedging activities
Floors (in dollars per Mmbtu's/Bbl's)		95.00
Ceilings (in dollars per Mmbtu's/Bbl's)		100.60
July 2013 - September 2013 | Collars | Commodity contracts | Crude oil
Derivative and hedging activities
Volume in Mmbtu's/Bbl's	147,200	147,200
Floors (in dollars per Mmbtu's/Bbl's)	95.00	95.00
July 2013 - September 2013 | Collars | Commodity contracts | Crude oil | Minimum
Derivative and hedging activities
Ceilings (in dollars per Mmbtu's/Bbl's)	99.00	99.00
July 2013 - September 2013 | Collars | Commodity contracts | Crude oil | Maximum
Derivative and hedging activities
Ceilings (in dollars per Mmbtu's/Bbl's)	101.50	101.50
July 2013 - September 2013 | Collars | Commodity contracts | Crude oil | Weighted Average
Derivative and hedging activities
Floors (in dollars per Mmbtu's/Bbl's)	95.00	95.00
Ceilings (in dollars per Mmbtu's/Bbl's)	99.94	99.94
July 2013 - December 2013 | Collars | Commodity contracts | Crude oil
Derivative and hedging activities
Volume in Mmbtu's/Bbl's	3,862,500
July 2013 - December 2013 | Collars | Commodity contracts | Crude oil | Minimum
Derivative and hedging activities
Floors (in dollars per Mmbtu's/Bbl's)	80.00
Ceilings (in dollars per Mmbtu's/Bbl's)	91.65
July 2013 - December 2013 | Collars | Commodity contracts | Crude oil | Maximum
Derivative and hedging activities
Floors (in dollars per Mmbtu's/Bbl's)	100.00
Ceilings (in dollars per Mmbtu's/Bbl's)	107.25
July 2013 - December 2013 | Collars | Commodity contracts | Crude oil | Weighted Average
Derivative and hedging activities
Floors (in dollars per Mmbtu's/Bbl's)	89.70
Ceilings (in dollars per Mmbtu's/Bbl's)	98.28
July 2013 - December 2013 | Collars | Commodity contracts | Natural gas
Derivative and hedging activities
Volume in Mmbtu's/Bbl's	4,324,000
July 2013 - December 2013 | Collars | Commodity contracts | Natural gas | Minimum
Derivative and hedging activities
Floors (in dollars per Mmbtu's/Bbl's)	3.50
Ceilings (in dollars per Mmbtu's/Bbl's)	3.95
July 2013 - December 2013 | Collars | Commodity contracts | Natural gas | Maximum
Derivative and hedging activities
Floors (in dollars per Mmbtu's/Bbl's)	4.00
Ceilings (in dollars per Mmbtu's/Bbl's)	4.49
July 2013 - December 2013 | Collars | Commodity contracts | Natural gas | Weighted Average
Derivative and hedging activities
Floors (in dollars per Mmbtu's/Bbl's)	3.78
Ceilings (in dollars per Mmbtu's/Bbl's)	4.26
July 2013 - December 2013 | Swaps | Commodity contracts | Crude oil
Derivative and hedging activities
Volume in Mmbtu's/Bbl's	180,000
July 2013 - December 2013 | Swaps | Commodity contracts | Crude oil | Minimum
Derivative and hedging activities
Floors (in dollars per Mmbtu's/Bbl's)	97.60
July 2013 - December 2013 | Swaps | Commodity contracts | Crude oil | Maximum
Derivative and hedging activities
Floors (in dollars per Mmbtu's/Bbl's)	105.55
July 2013 - December 2013 | Swaps | Commodity contracts | Crude oil | Weighted Average
Derivative and hedging activities
Floors (in dollars per Mmbtu's/Bbl's)	102.18
July 2013 - December 2013 | Swaps | Commodity contracts | Natural gas
Derivative and hedging activities
Volume in Mmbtu's/Bbl's	120,000
Floors (in dollars per Mmbtu's/Bbl's)	3.56
July 2013 - December 2013 | Swaps | Commodity contracts | Natural gas | Weighted Average
Derivative and hedging activities
Floors (in dollars per Mmbtu's/Bbl's)	3.56
September 2013 - December 2013 | Collars | Commodity contracts | Crude oil
Derivative and hedging activities
Volume in Mmbtu's/Bbl's	183,000
Floors (in dollars per Mmbtu's/Bbl's)	90.00
Ceilings (in dollars per Mmbtu's/Bbl's)	100.10
September 2013 - December 2013 | Collars | Commodity contracts | Crude oil | Weighted Average
Derivative and hedging activities
Floors (in dollars per Mmbtu's/Bbl's)	90.00
Ceilings (in dollars per Mmbtu's/Bbl's)	100.10
October 2013 - December 2013 | Collars | Commodity contracts | Crude oil
Derivative and hedging activities
Volume in Mmbtu's/Bbl's	142,600	142,600
Floors (in dollars per Mmbtu's/Bbl's)	95.00	95.00
October 2013 - December 2013 | Collars | Commodity contracts | Crude oil | Minimum
Derivative and hedging activities
Ceilings (in dollars per Mmbtu's/Bbl's)	99.00	99.00
October 2013 - December 2013 | Collars | Commodity contracts | Crude oil | Maximum
Derivative and hedging activities
Ceilings (in dollars per Mmbtu's/Bbl's)	101.00	101.00
October 2013 - December 2013 | Collars | Commodity contracts | Crude oil | Weighted Average
Derivative and hedging activities
Floors (in dollars per Mmbtu's/Bbl's)	95.00	95.00
Ceilings (in dollars per Mmbtu's/Bbl's)	99.71	99.71
October 2013 - December 2013 | Collars | Commodity contracts | Natural gas
Derivative and hedging activities
Volume in Mmbtu's/Bbl's	460,000
Floors (in dollars per Mmbtu's/Bbl's)	3.75
Ceilings (in dollars per Mmbtu's/Bbl's)	4.35
October 2013 - December 2013 | Collars | Commodity contracts | Natural gas | Weighted Average
Derivative and hedging activities
Floors (in dollars per Mmbtu's/Bbl's)	3.75
Ceilings (in dollars per Mmbtu's/Bbl's)	4.35
January 2013 - December 2013 | Collars | Commodity contracts | Crude oil
Derivative and hedging activities
Volume in Mmbtu's/Bbl's		5,201,250
January 2013 - December 2013 | Collars | Commodity contracts | Crude oil | Minimum
Derivative and hedging activities
Floors (in dollars per Mmbtu's/Bbl's)		80.00
Ceilings (in dollars per Mmbtu's/Bbl's)		91.65
January 2013 - December 2013 | Collars | Commodity contracts | Crude oil | Maximum
Derivative and hedging activities
Floors (in dollars per Mmbtu's/Bbl's)		100.00
Ceilings (in dollars per Mmbtu's/Bbl's)		107.25
January 2013 - December 2013 | Collars | Commodity contracts | Crude oil | Weighted Average
Derivative and hedging activities
Floors (in dollars per Mmbtu's/Bbl's)		89.04
Ceilings (in dollars per Mmbtu's/Bbl's)		98.06
January 2013 - December 2013 | Collars | Commodity contracts | Natural gas
Derivative and hedging activities
Volume in Mmbtu's/Bbl's		1,825,000
Floors (in dollars per Mmbtu's/Bbl's)		3.75
Ceilings (in dollars per Mmbtu's/Bbl's)		4.26
January 2013 - December 2013 | Collars | Commodity contracts | Natural gas | Weighted Average
Derivative and hedging activities
Floors (in dollars per Mmbtu's/Bbl's)		3.75
Ceilings (in dollars per Mmbtu's/Bbl's)		4.26
January 2013 - December 2013 | Swaps | Commodity contracts | Crude oil
Derivative and hedging activities
Volume in Mmbtu's/Bbl's		360,000
January 2013 - December 2013 | Swaps | Commodity contracts | Crude oil | Minimum
Derivative and hedging activities
Floors (in dollars per Mmbtu's/Bbl's)		97.60
January 2013 - December 2013 | Swaps | Commodity contracts | Crude oil | Maximum
Derivative and hedging activities
Floors (in dollars per Mmbtu's/Bbl's)		105.55
January 2013 - December 2013 | Swaps | Commodity contracts | Crude oil | Weighted Average
Derivative and hedging activities
Floors (in dollars per Mmbtu's/Bbl's)		102.18
January 2013 - December 2013 | Swaps | Commodity contracts | Natural gas
Derivative and hedging activities
Volume in Mmbtu's/Bbl's		240,000
Floors (in dollars per Mmbtu's/Bbl's)		3.56
January 2013 - December 2013 | Swaps | Commodity contracts | Natural gas | Weighted Average
Derivative and hedging activities
Floors (in dollars per Mmbtu's/Bbl's)		3.56
February 2013 - December 2013 | Collars | Commodity contracts | Crude oil
Derivative and hedging activities
Volume in Mmbtu's/Bbl's		250,500
Floors (in dollars per Mmbtu's/Bbl's)		100.00
Ceilings (in dollars per Mmbtu's/Bbl's)		104.15
February 2013 - December 2013 | Collars | Commodity contracts | Crude oil | Weighted Average
Derivative and hedging activities
Floors (in dollars per Mmbtu's/Bbl's)		100.00
Ceilings (in dollars per Mmbtu's/Bbl's)		104.15
April 2014 - June 2014 | 3 Way-collars | Commodity contracts | Crude oil
Derivative and hedging activities
Volume in Mmbtu's/Bbl's	136,500	136,500
Floors (in dollars per Mmbtu's/Bbl's)	95.00	95.00
Put Options Sold (in dollars per Mmbtu's/Bbl's)	70.00	70.00
April 2014 - June 2014 | 3 Way-collars | Commodity contracts | Crude oil | Minimum
Derivative and hedging activities
Ceilings (in dollars per Mmbtu's/Bbl's)	98.20	98.20
April 2014 - June 2014 | 3 Way-collars | Commodity contracts | Crude oil | Maximum
Derivative and hedging activities
Ceilings (in dollars per Mmbtu's/Bbl's)	101.00	101.00
April 2014 - June 2014 | 3 Way-collars | Commodity contracts | Crude oil | Weighted Average
Derivative and hedging activities
Floors (in dollars per Mmbtu's/Bbl's)	95.00	95.00
Ceilings (in dollars per Mmbtu's/Bbl's)	99.13	99.13
Put Options Sold (in dollars per Mmbtu's/Bbl's)	70.00	70.00
January 2014 - March 2014 | 3 Way-collars | Commodity contracts | Crude oil
Derivative and hedging activities
Volume in Mmbtu's/Bbl's	144,000	144,000
Floors (in dollars per Mmbtu's/Bbl's)	95.00	95.00
Put Options Sold (in dollars per Mmbtu's/Bbl's)	70.00	70.00
January 2014 - March 2014 | 3 Way-collars | Commodity contracts | Crude oil | Minimum
Derivative and hedging activities
Ceilings (in dollars per Mmbtu's/Bbl's)	98.60	98.60
January 2014 - March 2014 | 3 Way-collars | Commodity contracts | Crude oil | Maximum
Derivative and hedging activities
Ceilings (in dollars per Mmbtu's/Bbl's)	109.50	109.50
January 2014 - March 2014 | 3 Way-collars | Commodity contracts | Crude oil | Weighted Average
Derivative and hedging activities
Floors (in dollars per Mmbtu's/Bbl's)	95.00	95.00
Ceilings (in dollars per Mmbtu's/Bbl's)	100.03	100.03
Put Options Sold (in dollars per Mmbtu's/Bbl's)	70.00	70.00
January 2014 - December 2014 | Collars | Commodity contracts | Crude oil
Derivative and hedging activities
Volume in Mmbtu's/Bbl's	5,840,000	2,190,000
Floors (in dollars per Mmbtu's/Bbl's)		85.00
January 2014 - December 2014 | Collars | Commodity contracts | Crude oil | Minimum
Derivative and hedging activities
Floors (in dollars per Mmbtu's/Bbl's)	85.00
Ceilings (in dollars per Mmbtu's/Bbl's)	93.60	95.10
January 2014 - December 2014 | Collars | Commodity contracts | Crude oil | Maximum
Derivative and hedging activities
Floors (in dollars per Mmbtu's/Bbl's)	90.00
Ceilings (in dollars per Mmbtu's/Bbl's)	96.35	96.35
January 2014 - December 2014 | Collars | Commodity contracts | Crude oil | Weighted Average
Derivative and hedging activities
Floors (in dollars per Mmbtu's/Bbl's)	87.97	85.00
Ceilings (in dollars per Mmbtu's/Bbl's)	95.14	95.92
January 2014 - December 2014 | Collars | Commodity contracts | Natural gas
Derivative and hedging activities
Volume in Mmbtu's/Bbl's	11,862,500	1,825,000
Floors (in dollars per Mmbtu's/Bbl's)		3.75
Ceilings (in dollars per Mmbtu's/Bbl's)		4.26
January 2014 - December 2014 | Collars | Commodity contracts | Natural gas | Minimum
Derivative and hedging activities
Floors (in dollars per Mmbtu's/Bbl's)	3.75
Ceilings (in dollars per Mmbtu's/Bbl's)	4.26
January 2014 - December 2014 | Collars | Commodity contracts | Natural gas | Maximum
Derivative and hedging activities
Floors (in dollars per Mmbtu's/Bbl's)	4.00
Ceilings (in dollars per Mmbtu's/Bbl's)	4.55
January 2014 - December 2014 | Collars | Commodity contracts | Natural gas | Weighted Average
Derivative and hedging activities
Floors (in dollars per Mmbtu's/Bbl's)	3.88	3.75
Ceilings (in dollars per Mmbtu's/Bbl's)	4.36	4.26
January 2014 - June 2014 | Collars | Commodity contracts | Crude oil
Derivative and hedging activities
Volume in Mmbtu's/Bbl's	724,000
Floors (in dollars per Mmbtu's/Bbl's)	90.00
January 2014 - June 2014 | Collars | Commodity contracts | Crude oil | Minimum
Derivative and hedging activities
Ceilings (in dollars per Mmbtu's/Bbl's)	96.50
January 2014 - June 2014 | Collars | Commodity contracts | Crude oil | Maximum
Derivative and hedging activities
Ceilings (in dollars per Mmbtu's/Bbl's)	99.50
January 2014 - June 2014 | Collars | Commodity contracts | Crude oil | Weighted Average
Derivative and hedging activities
Floors (in dollars per Mmbtu's/Bbl's)	90.00
Ceilings (in dollars per Mmbtu's/Bbl's)	98.00
July 2014 - December 2014 | Collars | Commodity contracts | Natural gas
Derivative and hedging activities
Volume in Mmbtu's/Bbl's	920,000
Floors (in dollars per Mmbtu's/Bbl's)	4.00
Ceilings (in dollars per Mmbtu's/Bbl's)	4.42
July 2014 - December 2014 | Collars | Commodity contracts | Natural gas | Weighted Average
Derivative and hedging activities
Floors (in dollars per Mmbtu's/Bbl's)	4.00
Ceilings (in dollars per Mmbtu's/Bbl's)	4.42
July 2014 - December 2014 | Put options | Commodity contracts | Crude oil
Derivative and hedging activities
Volume in Mmbtu's/Bbl's	184,000
Put Options Sold (in dollars per Mmbtu's/Bbl's)	90.00
July 2014 - December 2014 | Put options | Commodity contracts | Crude oil | Weighted Average
Derivative and hedging activities
Put Options Sold (in dollars per Mmbtu's/Bbl's)	90.00
January 2015 - December 2015 | Collars | Commodity contracts | Natural gas
Derivative and hedging activities
Volume in Mmbtu's/Bbl's	6,387,500
Floors (in dollars per Mmbtu's/Bbl's)	4.00
January 2015 - December 2015 | Collars | Commodity contracts | Natural gas | Minimum
Derivative and hedging activities
Ceilings (in dollars per Mmbtu's/Bbl's)	4.55
January 2015 - December 2015 | Collars | Commodity contracts | Natural gas | Maximum
Derivative and hedging activities
Ceilings (in dollars per Mmbtu's/Bbl's)	4.85
January 2015 - December 2015 | Collars | Commodity contracts | Natural gas | Weighted Average
Derivative and hedging activities
Floors (in dollars per Mmbtu's/Bbl's)	4.00
Ceilings (in dollars per Mmbtu's/Bbl's)	4.68

XML

LONG-TERM DEBT (Details 6) (USD $)	Jun. 30, 2013	Dec. 31, 2012
Debt Issuance Costs
Unamortized debt issuance costs	$ 59,294,000	$ 51,609,000
Additional 2021 Notes
Debt Issuance Costs
Costs associated with the issuance of debt capitalized	$ 11,500,000

XML

CONDENSED CONSOLIDATED BALANCE SHEETS (USD $) In Thousands, unless otherwise specified	Jun. 30, 2013	Dec. 31, 2012
Current assets:
Cash	$ 3,061	$ 2,506
Accounts receivable	264,216	262,809
Receivables from derivative contracts	9,336	7,428
Current portion of deferred income taxes		5,307
Inventory	6,581	3,116
Prepaids and other	12,968	6,691
Total current assets	296,162	287,857
Oil and natural gas properties (full cost method):
Evaluated	3,843,579	2,669,245
Unevaluated	2,307,887	2,326,598
Gross oil and natural gas properties	6,151,466	4,995,843
Less - accumulated depletion	(761,013)	(588,207)
Net oil and natural gas properties	5,390,453	4,407,636
Other operating property and equipment:
Gas gathering and other operating assets	142,436	59,748
Less - accumulated depreciation	(10,537)	(8,119)
Net other operating property and equipment	131,899	51,629
Other noncurrent assets:
Goodwill	228,800	227,762
Receivables from derivative contracts	11,299	371
Debt issuance costs, net of amortization	59,294	51,609
Equity in oil and natural gas partnerships	11,059	11,137
Funds in escrow	847	2,090
Other	37,132	934
Total assets	6,166,945	5,041,025
Current liabilities:
Accounts payable and accrued liabilities	705,817	590,551
Liabilities from derivative contracts	5,198	10,429
Current portion of deferred income taxes	764
Asset retirement obligations	2,923	2,319
Promissory notes		74,669
Total current liabilities	714,702	677,968
Long-term debt	2,713,947	2,034,498
Other noncurrent liabilities:
Liabilities from derivative contracts		2,461
Asset retirement obligations	79,428	72,813
Deferred income taxes	173,258	160,055
Other	3,785	10
Commitments and contingencies (Note 10)
Mezzanine equity:
Preferred stock: 1,000,000 shares of $0.0001 par value authorized; none and 10,880 shares of 8% Automatically Convertible, issued and outstanding as of June 30, 2013 and December 31, 2012, respectively		695,238
Stockholders' equity:
Common stock: 670,000,000 and 336,666,666 shares of $0.0001 par value authorized; 370,077,763 and 259,802,377 shares issued; 370,077,763 and 258,152,468 outstanding at June 30, 2013 and December 31, 2012, respectively	37	26
Preferred stock: 1,000,000 shares of $0.0001 par value authorized; 345,000 and none shares of 5.75% Cumulative Perpetual Convertible, Series A, issued and outstanding as of June 30, 2013 and December 31, 2012, respectively
Additional paid-in capital	2,713,698	1,681,717
Treasury stock: none and 1,649,909 shares at June 30, 2013 and December 31, 2012, respectively, at cost		(9,298)
Accumulated deficit	(231,910)	(274,463)
Total stockholders' equity	2,481,825	1,397,982
Total liabilities and stockholders' equity	$ 6,166,945	$ 5,041,025

XML

DERIVATIVE AND HEDGING ACTIVITIES

6 Months Ended

Jun. 30, 2013

DERIVATIVE AND HEDGING ACTIVITIES

DERIVATIVE AND HEDGING ACTIVITIES

8. DERIVATIVE AND HEDGING ACTIVITIES

        The Company is exposed to certain risks relating to its ongoing business operations, such as commodity price risk and interest rate risk. Derivative contracts are utilized to economically hedge the Company's exposure to price fluctuations and reduce the variability in the Company's cash flows associated with anticipated sales of future oil and natural gas production. The Company generally hedges a substantial, but varying, portion of anticipated oil and natural gas production for future periods. Derivatives are carried at fair value on the unaudited condensed consolidated balance sheets as assets or liabilities, with the changes in the fair value included in the unaudited condensed consolidated statements of operations for the period in which the change occurs. Historically, the Company has also entered into interest rate swaps to mitigate exposure to market rate fluctuations.

        It is the Company's policy to enter into derivative contracts, including interest rate derivatives, only with counterparties that are creditworthy financial institutions deemed by management as competent and competitive market makers. Each of the counterparties to the Company's current derivative contracts is a lender or an affiliate of a lender in its Senior Credit Agreement. The Company did not post collateral under any of these contracts as they are secured under the Company's Senior Credit Agreement.

        At June 30, 2013 and December 31, 2012, the Company's crude oil and natural gas derivative positions consisted of swaps, costless put/call "collars" and put options. Swaps are designed so that the Company receives or makes payments based on a differential between fixed and variable prices for crude oil and natural gas. A costless collar consists of a sold call, which establishes a maximum price the Company will receive for the volumes under contract and a purchased put that establishes a minimum price. A sold put option limits the exposure of the counterparty's risk should the price fall below the strike price. Sold put options limit the effectiveness of purchased put options at the low end of the put/call collars to market prices in excess of the strike price of the put option sold. The Company has elected to not designate any of its derivative contracts for hedge accounting. Accordingly, the Company records the net change in the mark-to-market valuation of these derivative contracts, as well as all payments and receipts on settled derivative contracts, in "Net gain (loss) on derivative contracts" on the unaudited condensed consolidated statements of operations.

        In February 2012, pursuant to the Senior Credit Agreement, the Company novated its oil and natural gas derivative instruments to counterparties that are lenders or affiliates of lenders within the Senior Credit Agreement resulting in a realized loss of $0.4 million for novation fees and terminated the interest rate derivatives resulting in a $0.6 million realized loss during the three months ended March 31, 2012.

        At June 30, 2013, the Company had 73 open commodity derivative contracts summarized in the following tables: 16 natural gas collar arrangements, one natural gas swap, 46 crude oil collar arrangements, five crude oil three-way collars, one crude oil put option, and four crude oil swaps.

        At December 31, 2012, the Company had 47 open commodity derivative contracts summarized in the following tables: two natural gas collar arrangements, two natural gas swaps, one natural gas basis swap, 28 crude oil collar arrangements, 10 crude oil three-way collars, and four crude oil swaps.

        All derivative contracts are recorded at fair market value in accordance with ASC 815 and ASC 820 and included in the unaudited condensed consolidated balance sheets as assets or liabilities. The following table summarizes the location and fair value amounts of all derivative contracts in the unaudited condensed consolidated balance sheets as of June 30, 2013 and December 31, 2012:

		Asset derivative contracts					Liability derivative contracts
Derivatives not designated as hedging contracts under ASC 815	Balance sheet location	June 30, 2013		December 31, 2012		Balance sheet location	June 30, 2013			December 31, 2012
		(In thousands)					(In thousands)
Commodity contracts	Current assets—receivables from derivative contracts	$	9,336	$	7,428	Current liabilities—liabilities from derivative contracts	$	(5,198	)	$	(10,429	)
Commodity contracts	Other noncurrent assets—receivables from derivative contracts		11,299		371	Other noncurrent liabilities—liabilities from derivative contracts		—			(2,461	)
Total derivatives not designated as hedging contracts under ASC 815		$	20,635	$	7,799		$	(5,198	)	$	(12,890	)

        The following table summarizes the location and amounts of the Company's realized and unrealized gains and losses on derivative contracts in the Company's unaudited condensed consolidated statements of operations:

		Amount of gain or (loss) recognized in income on derivative contracts for the Three Months Ended June 30,					Amount of gain or (loss) recognized in income on derivative contracts for the Six Months Ended June 30,
	Location of gain or (loss) recognized in income on derivative contracts
Derivatives not designated as hedging contracts under ASC 815		2013			2012		2013			2012
		(In thousands)					(In thousands)
Commodity contracts:
Unrealized gain (loss) on commodity contracts	Other income (expenses)—net gain (loss) on derivative contracts	$	34,515		$	12,638	$	17,716		$	7,176
Realized gain (loss) on commodity contracts	Other income (expenses)—net gain (loss) on derivative contracts		(415	)		1,033		(2,038	)		1,608
Total net gain (loss) on commodity contracts		$	34,100		$	13,671	$	15,678		$	8,784
Interest rate swaps:
Unrealized gain (loss) on interest rate swaps	Other income (expenses)—net gain (loss) on derivative contracts	$	—		$	—	$	—		$	518
Realized gain (loss) on interest rate swaps	Other income (expenses)—net gain (loss) on derivative contracts		—			—		—			(576	)
Total net gain (loss) on interest rate swaps		$	—		$	—	$	—		$	(58	)
Total net gain (loss) on derivative contracts	Other income (expenses)—net gain (loss) on derivative contracts	$	34,100		$	13,671	$	15,678		$	8,726

        At June 30, 2013 and December 31, 2012, the Company had the following open crude oil and natural gas derivative contracts:

			June 30, 2013
					Floors				Ceilings				Put Options Sold
Period	Instrument	Commodity	Volume in Mmbtu's/ Bbl's		Price / Price Range		Weighted Average Price		Price / Price Range		Weighted Average Price		Price / Price Range		Weighted Average Price
July 2013 - September 2013	Collars	Crude Oil		147,200	$	95.00	$	95.00	$	99.00 - 101.50	$	99.94
July 2013 - December 2013	Collars	Crude Oil		3,862,500		80.00 - 100.00		89.70		91.65 - 107.25		98.28
July 2013 - December 2013	Collars	Natural Gas		4,324,000		3.50 - 4.00		3.78		3.95 - 4.49		4.26
July 2013 - December 2013	Swaps	Crude Oil		180,000		97.60 - 105.55		102.18
July 2013 - December 2013	Swaps	Natural Gas		120,000		3.56		3.56
September 2013 - December 2013	Collars	Crude Oil		183,000		90.00		90.00		100.10		100.10
October 2013 - December 2013	Collars	Crude Oil		142,600		95.00		95.00		99.00 - 101.00		99.71
October 2013 - December 2013	Collars	Natural Gas		460,000		3.75		3.75		4.35		4.35
January 2014 - March 2014	Three-Way Collars	Crude Oil		144,000		95.00		95.00		98.60 - 109.50		100.03		70.00		70.00
January 2014 - June 2014	Collars	Crude Oil		724,000		90.00		90.00		96.50 - 99.50		98.00
April 2014 - June 2014	Three-Way Collars	Crude Oil		136,500		95.00		95.00		98.20 - 101.00		99.13		70.00		70.00
January 2014 - December 2014	Collars	Crude Oil		5,840,000		85.00 - 90.00		87.97		93.60 - 96.35		95.14
January 2014 - December 2014	Collars	Natural Gas		11,862,500		3.75 - 4.00		3.88		4.26 - 4.55		4.36
July 2014 - December 2014	Collars	Natural Gas		920,000		4.00		4.00		4.42		4.42
July 2014 - December 2014	Put	Crude Oil		184,000										90.00		90.00
January 2015 - December 2015	Collars	Natural Gas		6,387,500		4.00		4.00		4.55 - 4.85		4.68

			December 31, 2012
					Floors				Ceilings				Put Options Sold
Period	Instrument	Commodity	Volume in Mmbtu's/ Bbl's		Price / Price Range		Weighted Average Price		Price / Price Range		Weighted Average Price		Price / Price Range		Weighted Average Price
January 2013 - March 2013	Three-Way Collars	Crude Oil		130,500	$	95.00 - 100.00	$	95.34	$	105.50 - 109.50	$	101.36	$	70.00	$	70.00
January 2013 - March 2013	Basis Swaps	Natural Gas		225,000
January 2013 - March 2013	Collars	Crude Oil		31,500		95.00		95.00		101.50		101.50
January 2013 - March 2013	Swaps	Natural Gas		225,000		4.85		4.85
April 2013 - June 2013	Three-Way Collars	Crude Oil		120,575		95.00		95.00		99.50 - 100.60		99.77		70.00		70.00
April 2013 - June 2013	Collars	Crude Oil		29,575		95.00		95.00		100.60		100.60
July 2013 - September 2013	Collars	Crude Oil		147,200		95.00		95.00		99.00 - 101.50		99.94
October 2013 - December 2013	Collars	Crude Oil		142,600		95.00		95.00		99.00 - 101.00		99.71
January 2013 - December 2013	Collars	Crude Oil		5,201,250		80.00 - 100.00		89.04		91.65 - 107.25		98.06
January 2013 - December 2013	Collars	Natural Gas		1,825,000		3.75		3.75		4.26		4.26
January 2013 - December 2013	Swaps	Natural Gas		240,000		3.56		3.56
January 2013 - December 2013	Swaps	Crude Oil		360,000		97.60 - 105.55		102.18
February 2013 - December 2013	Collars	Crude Oil		250,500		100.00		100.00		104.15		104.15
April 2014 - June 2014	Three-Way Collars	Crude Oil		136,500		95.00		95.00		98.20 - 101.00		99.13		70.00		70.00
January 2014 - March 2014	Three-Way Collars	Crude Oil		144,000		95.00		95.00		98.60 - 109.50		100.03		70.00		70.00
January 2014 - December 2014	Collars	Crude Oil		2,190,000		85.00		85.00		95.10 - 96.35		95.92
January 2014 - December 2014	Collars	Natural Gas		1,825,000		3.75		3.75		4.26		4.26

        The Company presents the fair value of its derivative contracts at the gross amounts in the unaudited condensed consolidated balance sheets. The following table shows the potential effects of master netting arrangements on the fair value of the Company's derivative contracts at June 30, 2013 and December 31, 2012 in accordance with ASU 2011-11 and ASU 2013-01, which were effective beginning January 1, 2013:

	Derivative Assets						Derivative Liabilities
Offsetting of Derivative Assets and Liabilities	June 30, 2013			December 31, 2012			June 30, 2013			December 31, 2012
	(In thousands)						(In thousands)
Gross amounts presented in the consolidated balance sheet	$	20,635		$	7,799		$	(5,198	)	$	(12,890	)
Amounts not offset in the consolidated balance sheet		(3,506	)		(4,118	)		3,414			3,899
Net amount	$	17,129		$	3,681		$	(1,784	)	$	(8,991	)

        The Company enters into an International Swap Dealers Association Master Agreement (ISDA) with each counterparty prior to a derivative contract with such counterparty. The ISDA is a standard contract that governs all derivative contracts entered into between the Company and the respective counterparty. The ISDA allows for offsetting of amounts payable or receivable between the Company and the counterparty, at the election of both parties, for transactions that occur on the same date and in the same currency.

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CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY (USD $) In Thousands, unless otherwise specified	Total	Preferred Stock	Common Stock	Additional Paid-In Capital	Treasury Stock	Accumulated Deficit
Balances at Dec. 31, 2011	$ 1,680		$ 3	$ 229,414	$ (7,159)	$ (220,578)
Balances (in shares) at Dec. 31, 2011			27,695		1,450
Increase (Decrease) in Stockholders' Equity
Warrants issued	43,590			43,590
Sale of common stock	569,000		11	568,989
Sale of common stock (in shares)			115,232
Increase in common shares count as a result of reverse stock split (in shares)			4
Sale of preferred stock	311,556	311,556
Sale of preferred stock (in shares)		4
Preferred stock conversion		(385,476)	5	385,471
Preferred stock conversion (in shares)		(4)	44,445
Offering costs	(19,603)	(14,525)		(5,078)
Common stock issuance	452,039		7	452,032
Common stock issuance (in shares)			72,114
Net income (loss)	(53,885)					(53,885)
Preferred beneficial conversion feature	88,445			88,445
Non-cash preferred dividend		88,445		(88,445)
Long-term incentive plan grants (in shares)			312
Repurchase of stock	(2,139)				(2,139)
Repurchase of stock (in shares)					200
Share-based compensation	7,299			7,299
Balances at Dec. 31, 2012	1,397,982		26	1,681,717	(9,298)	(274,463)
Balances (in shares) at Dec. 31, 2012			259,802		1,650
Increase (Decrease) in Stockholders' Equity
Sale of preferred stock	345,000			345,000
Preferred stock conversion	695,238		11	695,227
Preferred stock conversion (in shares)			108,801
Offering costs	(9,658)			(9,658)
Net income (loss)	42,553					42,553
Long-term incentive plan grants (in shares)			3,218
Long-term incentive plan forfeitures (in shares)			(94)
Retirement of shares in treasury				(2,492)	2,492
Retirement of shares in treasury (in shares)			(442)		(442)
Long-term incentive plan grants issued out of treasury				(6,806)	6,806
Long-term incentive plan grants issued out of treasury (in shares)			(1,208)		(1,208)
Share-based compensation	10,710			10,710
Balances at Jun. 30, 2013	$ 2,481,825		$ 37	$ 2,713,698		$ (231,910)
Balances (in shares) at Jun. 30, 2013			370,077

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SUBSEQUENT EVENT (Details) (USD $) In Millions, unless otherwise specified					0 Months Ended
	Jul. 19, 2013 Senior Credit Agreement	Jun. 30, 2013 Senior Credit Agreement	Jul. 19, 2013 Subsequent event Adjustment	Jun. 30, 2013 Subsequent event Senior Credit Agreement	Jul. 19, 2013 Subsequent event Eagle Ford assets in Fayette and Gonzales Counties, Texas
Subsequent event
Proceeds from sale of interests, before post-closing adjustments					$ 144
Gain (loss) from sale of interests					0
Current borrowing capacity	$ 810.0	$ 850.0	$ 810.0	$ 850.0

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CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (USD $) In Thousands, except Per Share data, unless otherwise specified	3 Months Ended		6 Months Ended
	Jun. 30, 2013	Jun. 30, 2012	Jun. 30, 2013	Jun. 30, 2012
Oil, natural gas and natural gas liquids sales:
Oil	$ 202,490	$ 20,383	$ 383,317	$ 43,380
Natural gas	6,845	1,270	12,514	2,957
Natural gas liquids	4,254	1,653	8,082	3,850
Total oil, natural gas and natural gas liquids sales	213,589	23,306	403,913	50,187
Other	754	35	1,284	71
Total operating revenues	214,343	23,341	405,197	50,258
Production:
Lease operating	31,833	8,303	57,137	15,916
Workover and other	623	540	2,247	1,261
Taxes other than income	18,567	1,908	36,003	3,834
Gathering and other	2,802	60	3,135	107
Restructuring	(164)	903	507	1,007
General and administrative	33,526	12,891	65,123	33,203
Depletion, depreciation and accretion	95,315	5,956	177,173	11,935
Total operating expenses	182,502	30,561	341,325	67,263
Income (loss) from operations	31,841	(7,220)	63,872	(17,005)
Other income (expenses):
Interest expense and other, net	(5,732)	(4,179)	(10,582)	(17,176)
Net gain (loss) on derivative contracts	34,100	13,671	15,678	8,726
Total other income (expenses)	28,368	9,492	5,096	(8,450)
Income (loss) before income taxes	60,209	2,272	68,968	(25,455)
Income tax benefit (provision)	(23,121)	5,387	(26,415)	(208)
Net income (loss)	37,088	7,659	42,553	(25,663)
Non-cash preferred dividend		(87,343)		(88,445)
Series A preferred dividends	(716)		(716)
Net income (loss) available to common stockholders	$ 36,372	$ (79,684)	$ 41,837	$ (114,108)
Net income (loss) per share of common stock:
Basic (in dollars per share)	$ 0.10	$ (0.59)	$ 0.12	$ (1.11)
Diluted (in dollars per share)	$ 0.08	$ (0.59)	$ 0.11	$ (1.11)
Weighted average common shares outstanding:
Basic (in shares)	366,712	136,066	356,482	102,441
Diluted (in shares)	441,145	136,066	412,412	102,441

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ASSET RETIREMENT OBLIGATIONS (Details) (USD $) In Thousands, unless otherwise specified	6 Months Ended
	Jun. 30, 2013
Activity related to ARO liability
Liability for asset retirement obligations at the beginning of the period	$ 75,132
Liabilities settled and divested	(265)
Additions	5,037
Acquisitions	1,055
Accretion expense	1,825
Revisions in estimated cash flows	(433)
Liability for asset retirement obligations at the end of the period	$ 82,351

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EARNINGS PER COMMON SHARE (Tables)

6 Months Ended

Jun. 30, 2013

EARNINGS PER COMMON SHARE

Schedule of calculation of earnings (loss) per share

	Three Months Ended June 30,					Six Months Ended June 30,
	2013		2012			2013		2012
	(In thousands, except per share amounts)
Basic:
Net income (loss) available to common stockholders	$	36,372	$	(79,684	)	$	41,837	$	(114,108	)
Weighted average basic number of common shares outstanding		366,712		136,066			356,482		102,441
Basic net income (loss) per share of common stock	$	0.10	$	(0.59	)	$	0.12	$	(1.11	)
Diluted:
Net income (loss) available to common stockholders	$	36,372	$	(79,684	)	$	41,837	$	(114,108	)
Interest on convertible debt, net		974		—			1,974		—
Net income (loss) available to common stockholders after assumed conversions	$	37,346	$	(79,684	)	$	43,811	$	(114,108	)
Weighted average basic number of common shares outstanding		366,712		136,066			356,482		102,441
Common stock equivalent shares representing shares issuable upon exercise of stock options		Anti-dilutive		Anti-dilutive			Anti-dilutive		Anti-dilutive
Common stock equivalent shares representing shares issuable upon exercise of Febuary 2012 Warrants		9,954		Anti-dilutive			12,183		Anti-dilutive
Common stock equivalent shares representing shares issuable upon exercise of August 2012 Warrants		Anti-dilutive		—			Anti-dilutive		—
Common stock equivalent shares representing shares included upon vesting of restricted shares		108		Anti-dilutive			682		Anti-dilutive
Common stock equivalent shares representing shares issuable upon conversion of 2017 Notes		64,371		Anti-dilutive			32,185		Anti-dilutive
Common stock equivalent shares representing shares issuable upon conversion of preferred stock		—		—			10,880		Anti-dilutive
Common stock equivalent shares representing shares issuable upon conversion of Series A Preferred Stock		Anti-dilutive		—			Anti-dilutive		—
Weighted average diluted number of common shares outstanding		441,145		136,066			412,412		102,441
Diluted net income (loss) per share of common stock	$	0.08	$	(0.59	)	$	0.11	$	(1.11	)

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RESTRUCTURING (Tables)

6 Months Ended

Jun. 30, 2013

RESTRUCTURING

Schedule of reconciliation of restructuring reserve

	Severance Program
	(In thousands)
Ending balance, December 31, 2012	$	2,131
Severance and retention payments		(2,627	)
Increase in accrual		496
Ending balance, June 30, 2013	$	—

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LONG-TERM DEBT (Details 5) (Promissory Notes, USD $)	6 Months Ended
	Jun. 30, 2013	Dec. 28, 2012
Long-term debt
Notice given to sellers for assertion of title and environmental defects for remaining properties	$ 12,900,000
Weber Acquisition
Long-term debt
Purchase price		83,700,000
Cash consideration		8,400,000
Promissory notes as consideration for acquisition		75,300,000
Amount paid to relieve a portion of the outstanding promissory notes	62,400,000
Unamortized discount		$ 600,000

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PREFERRED STOCK AND STOCKHOLDERS' EQUITY (Details 2) (USD $) In Millions, except Share data, unless otherwise specified	3 Months Ended		6 Months Ended																3 Months Ended	12 Months Ended	1 Months Ended
	Jun. 30, 2013 General and administrative	Jun. 30, 2012 General and administrative	Jun. 30, 2013 General and administrative	Jun. 30, 2012 General and administrative	Jun. 30, 2013 Stock options	Jun. 30, 2012 Stock options	Jun. 30, 2013 Stock options Low end of range	Jun. 30, 2012 Stock options Low end of range	Jun. 30, 2013 Stock options High end of range	Jun. 30, 2012 Stock options High end of range	Jun. 30, 2013 Restricted Stock	Jun. 30, 2012 Restricted Stock	Jun. 30, 2013 Restricted Stock Directors and employees	Jun. 30, 2013 Restricted Stock Employee	Jun. 30, 2012 Restricted Stock Employee	Jun. 30, 2013 Restricted Stock Non-employee director	Jun. 30, 2013 Restricted Stock Low end of range	Jun. 30, 2013 Restricted Stock High end of range	Mar. 31, 2012 Stock Appreciation Rights	Dec. 31, 2011 Stock Appreciation Rights	May 31, 2012 2006 Long-Term Incentive Plan	Jun. 30, 2013 2006 Long-Term Incentive Plan Common Stock	May 23, 2013 2006 Long-Term Incentive Plan Common Stock	Dec. 31, 2012 2006 Long-Term Incentive Plan Common Stock	May 17, 2012 2006 Long-Term Incentive Plan Common Stock	Feb. 08, 2012 2006 Long-Term Incentive Plan Common Stock	May 03, 2010 2006 Long-Term Incentive Plan Common Stock	May 08, 2008 2006 Long-Term Incentive Plan Common Stock	May 08, 2006 2006 Long-Term Incentive Plan Common Stock
Stock-based compensation
Shares issuable under the plan																							41,500,000		11,500,000	3,700,000	2,500,000	2,000,000	800,000
Term of effectiveness of plan from the date of approval																					10 years
Maximum number of shares that remained reserved for issuance under the Plan																						25,500,000		4,400,000
Compensation expense recorded	$ 4.6	$ 0.5	$ 7.0	$ 4.6
Granted (in shares)					6,100,000	1,300,000					3,200,000	200,000	3,200,000
Exercise price (in dollars per share)							$ 5.21	$ 8.73	$ 8.23	$ 11.55
Weighted average exercise price (in dollars per share)					$ 7.10	$ 10.11
Vesting period					3 years	3 years								3 years		6 months
Percentage of awards vesting on the annual anniversary date of the grant					33.33%	33.33%								33.33%	33.33%
Expiration term					10 years	10 years
Unrecognized compensation expense					19.5	4.8					18.1	2.0
Weighted average remaining vesting period					1 year 6 months	1 year 9 months 18 days					1 year 6 months	2 years
Weighted average grant date price (in dollars per share)											$ 6.92	$ 10.13
Grant date price (in dollars per share)																	$ 5.15	$ 7.65
Compensation expense related to accelerated vesting												2.6							2.2
Unrealized losses recorded, the reversal of which partially offsets realized compensation expense																				$ 0.8
Treasury Stock
Restricted stock granted to directors and employees under the Plan					6,100,000	1,300,000					3,200,000	200,000	3,200,000
Shares issued out of treasury stock													1,200,000
Shares retired													400,000

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OIL AND NATURAL GAS PROPERTIES (Details) (USD $) In Millions, unless otherwise specified	12 Months Ended		3 Months Ended		6 Months Ended
	Jun. 30, 2013	Jun. 30, 2012	Jun. 30, 2013 Unevaluated Oil and Gas Leaseholds	Jun. 30, 2012 Unevaluated Oil and Gas Leaseholds	Jun. 30, 2013 Unevaluated Oil and Gas Leaseholds	Jun. 30, 2012 Unevaluated Oil and Gas Leaseholds
Oil and Natural Gas Properties
Interest costs capitalized			$ 53.5	$ 3.3	$ 106.4	$ 3.4
Ceiling Limitation Disclosures
First day average of the West Texas Intermediate (WTI) spot price (in dollars per barrel)	91.60	95.67
First day average of the Henry Hub price (in dollars per Mmbtu)	3.45	3.15

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ACQUISITIONS (Details) (Williston Basin Assets, USD $)	0 Months Ended		0 Months Ended
	Dec. 06, 2012 item	Jan. 18, 2013 Petro-Hunt Parties	Dec. 06, 2012 Preferred stock	Jan. 18, 2013 Preferred stock	Jan. 17, 2013 Preferred stock	Jan. 17, 2013 Common stock	Jun. 02, 2012 Common stock October 2, 2013 Shelf Registration
Acquisition
Number of entities	2
Purchase price	$ 1,500,000,000
Cash consideration paid	$ 785,800,000
Shares issued or issuable			10,880
Preferred stock, conversion price (in dollars per share)				$ 7.45	$ 7.45	$ 7.45
Shares to be issued upon automatic conversion of preferred stock		108,800,000
Shares issuable							108,800,000

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ACQUISITIONS (Details 2) (GeoResources, USD $)	0 Months Ended
	Aug. 02, 2012
Other consideration transferred disclosures
Cash consideration fixed under the merger agreement (in dollars per share)	$ 20.00
Number of common shares issued per share of acquiree entity	1.932
Cash consideration paid to sellers	$ 531,500,000
Total purchase price plus liabilities assumed	$ 1,300,000,000
Common stock
Other consideration transferred disclosures
Shares issued	51,300,000

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FAIR VALUE MEASUREMENTS

6 Months Ended

Jun. 30, 2013

FAIR VALUE MEASUREMENTS

FAIR VALUE MEASUREMENTS

7. FAIR VALUE MEASUREMENTS

        Pursuant to ASC 820, Fair Value Measurements and Disclosures (ASC 820), the Company's determination of fair value incorporates not only the credit standing of the counterparties involved in transactions with the Company resulting in receivables on the Company's unaudited condensed consolidated balance sheets, but also the impact of the Company's nonperformance risk on its own liabilities. ASC 820 defines fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date (exit price). ASC 820 establishes a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value. The hierarchy assigns the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1) and the lowest priority to unobservable inputs (Level 3). Level 2 measurements are inputs that are observable for assets or liabilities, either directly or indirectly, other than quoted prices included within Level 1. The Company utilizes market data or assumptions that market participants would use in pricing the asset or liability, including assumptions about risk and the risks inherent in the inputs to the valuation technique. These inputs can be readily observable, market corroborated, or generally unobservable. The Company classifies fair value balances based on the observability of those inputs.

        The following tables set forth by level within the fair value hierarchy the Company's financial assets and liabilities that were accounted for at fair value as of June 30, 2013 and December 31, 2012. As required by ASC 820, a financial instrument's level within the fair value hierarchy is based on the lowest level of input that is significant to the fair value measurement. The Company's assessment of the significance of a particular input to the fair value measurement requires judgment, and may affect the valuation of fair value assets and liabilities and their placement within the fair value hierarchy levels. There were no transfers between fair value hierarchy levels for the six months ended June 30, 2013.

	June 30, 2013
	Level 1		Level 2		Level 3		Total
	(In thousands)
Assets
Receivables from derivative contracts	$	—	$	20,635	$	—	$	20,635
Liabilities
Liabilities from derivative contracts	$	—	$	5,198	$	—	$	5,198

	December 31, 2012
	Level 1		Level 2		Level 3		Total
	(In thousands)
Assets
Receivables from derivative contracts	$	—	$	7,799	$	—	$	7,799
Liabilities
Liabilities from derivative contracts	$	—	$	12,890	$	—	$	12,890
Liabilities from warrants(1)		—		1,342		—		1,342
Total Liabilities	$	—	$	14,232	$	—	$	14,232

⁽¹⁾

Liabilities from August 2012 warrants are recorded in "Accounts payable and accrued liabilities" on the unaudited condensed consolidated balance sheets.

        Derivative contracts listed above include collars, swaps and put options that are carried at fair value. The Company records the net change in the fair value of these positions in "Net gain (loss) on derivative contracts" in the Company's unaudited condensed consolidated statements of operations. The Company is able to value the assets and liabilities based on observable market data for similar instruments, which resulted in the Company reporting its derivatives as Level 2. This observable data includes the forward curves for commodity prices based on quoted markets prices and implied volatility factors related to changes in the forward curves. See Note 8, "Derivative and Hedging Activities" for additional discussion of derivatives.

        As of June 30, 2013 and December 31, 2012, the Company's derivative contracts were with major financial institutions with investment grade credit ratings which are believed to have a minimal credit risk. As such, the Company is exposed to credit risk to the extent of nonperformance by the counterparties in the derivative contracts; however, the Company does not anticipate such nonperformance. Each of the counterparties to the Company's current derivative contracts is a lender or an affiliate of a lender in the Company's Senior Credit Agreement. The Company did not post collateral under any of these contracts as they are secured under the Senior Credit Agreement.

        Warrants listed above at December 31, 2012 were carried at fair value. The Company recorded the net change in fair value on the August 2012 Warrants in "Interest expense and other, net" in the Company's unaudited condensed consolidated statements of operations. At December 31, 2012 and March 31, 2013, the Company valued the August 2012 Warrants based on observable market data, including treasury rates, historical volatility and data for similar instruments which resulted in the Company reporting its warrants as Level 2. During the three months ended March 31, 2013, an unrealized gain of $0.3 million was recorded to reflect the change in fair value. During the three months ended June 30, 2013, the Company recorded a gain of $1.6 million for the expiration of the warrants. See Note 11, "Preferred Stock and Stockholders' Equity" for additional discussion on the terms of the warrants.

        The following disclosure of the estimated fair value of financial instruments is made in accordance with the requirements of ASC 825, Financial Instruments. The estimated fair value amounts have been determined at discrete points in time based on relevant market information. These estimates involve uncertainties and cannot be determined with precision. The estimated fair value of cash, accounts receivable and accounts payable approximates their carrying value due to their short-term nature. The estimated fair value of the Company's Senior Credit Agreement and the promissory notes approximates carrying value because the interest rates approximate current market rates. The following table presents the estimated fair values of the Company's fixed interest rate, long-term debt instruments as of June 30, 2013 and December 31, 2012 (excluding discounts, premiums and deferred premiums on derivative contracts):

	June 30, 2013				December 31, 2012
Debt	Carrying Amount		Estimated Fair Value		Carrying Amount		Estimated Fair Value
	(In thousands)
8.875% $1.35 billion senior notes	$	1,350,000	$	1,316,250	$	750,000	$	798,750
9.75% $750 million senior notes		750,000		753,750		750,000		815,160
8.0% $275 million convertible note		289,669		462,655		289,669		625,425
	$	2,389,669	$	2,532,655	$	1,789,669	$	2,239,335

        The fair value of the Company's fixed interest debt instruments was calculated using Level 2 criteria at June 30, 2013 and December 31, 2012.

        The Company follows the provisions of ASC 820, Fair Value Measurements, for nonfinancial assets and liabilities measured at fair value on a non-recurring basis. These provisions apply to the Company's initial recognition of asset retirement obligations for which fair value is used. The asset retirement obligation estimates are derived from historical costs and management's expectation of future cost environments; and therefore, the Company has designated these liabilities as Level 3. See Note 9, "Asset Retirement Obligations," for a reconciliation of the beginning and ending balances of the liability for the Company's asset retirement obligations.

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ADDITIONAL FINANCIAL STATEMENT INFORMATION (Tables)

6 Months Ended

Jun. 30, 2013

ADDITIONAL FINANCIAL STATEMENT INFORMATION

Schedule of additional financial statement information, balance sheet

	June 30, 2013		December 31, 2012
	(In thousands)
Accounts receivable:
Oil, natural gas and natural gas liquids revenues	$	126,193	$	143,794
Joint interest accounts		133,334		113,671
Affiliated partnerships		386		475
Other		4,303		4,869
	$	264,216	$	262,809
Prepaids and other:
Prepaids	$	6,712	$	3,690
Other		6,256		3,001
	$	12,968	$	6,691
Other noncurrent assets:
Deposits for acquisitions of oil and natural gas properties	$	36,855	$	—
Other		277		934
	$	37,132	$	934
Accounts payable and accrued liabilities:
Trade payables	$	127,324	$	147,679
Accrued oil and natural gas capital costs		358,973		282,245
Revenues and royalties payable		133,736		91,761
Accrued interest expense		52,164		45,201
Accrued income taxes payable		4		130
Accrued employee compensation		13,328		12,321
Drilling advances from partners		20,205		8,840
Accounts payable to affiliated partnerships		83		822
Other		—		1,552
	$	705,817	$	590,551

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LONG-TERM DEBT (Details 3) (USD $)	0 Months Ended		6 Months Ended		6 Months Ended				0 Months Ended	6 Months Ended			6 Months Ended			0 Months Ended
	Jan. 14, 2013 8.875% Senior Notes	Nov. 06, 2012 8.875% Senior Notes	Jun. 30, 2013 8.875% Senior Notes	Dec. 31, 2012 8.875% Senior Notes	Jun. 30, 2013 8.875% Senior Notes On or before November 15, 2015	Jun. 30, 2013 8.875% Senior Notes On or before November 15, 2015 Maximum	Jun. 30, 2013 8.875% Senior Notes On or before November 15, 2015 Minimum	Jun. 30, 2013 8.875% Senior Notes On or before November 15, 2016	Jul. 16, 2012 9.75% Senior Notes	Jun. 30, 2013 9.75% Senior Notes	Dec. 31, 2012 9.75% Senior Notes	Jun. 30, 2013 9.75% Senior Notes On or before November 15, 2016	Jun. 30, 2013 9.75% Senior Notes On or before July 15, 2015	Jun. 30, 2013 9.75% Senior Notes On or before July 15, 2015 Maximum	Jun. 30, 2013 9.75% Senior Notes On or before July 15, 2015 Minimum	Jan. 14, 2013 Additional 2021 Notes	Jun. 30, 2013 Additional 2021 Notes
Long-term debt
Principal amount		$ 750,000,000	$ 1,350,000,000	$ 1,350,000,000					$ 750,000,000	$ 750,000,000	$ 750,000,000
Interest rate (as a percent)	8.875%	8.875%	8.875%	8.875%					9.75%	9.75%	9.75%
Issue price as a percentage of par value	105.00%	99.247%							98.646%
Net proceeds from issuance	619,500,000	725,600,000							723,100,000
Principal amount of debt issued	600,000,000															600,000,000
Independent assets			0							0
Independent operations			0							0
Percentage of principal amount of debt instrument which entity may redeem						35.00%								35.00%
Redemption price of debt instrument if redeemed with the proceeds of certain equity offerings (as a percent)					108.875%								109.75%
Percentage of principal amount of debt instrument which must remain outstanding after entity has redeemed a portion of debt instrument with proceeds from certain equity offerings							65.00%								65.00%
Redemption period for the entity to redeem debt instrument following the receipt of cash proceeds from certain equity offerings						180 days								180 days
Applicable margin (as a percent)								0.50%				0.50%
Unamortized discount		5,700,000	5,400,000	5,600,000					10,200,000	9,300,000	9,800,000
Unamortized premium																$ 30,000,000	$ 28,800,000

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COMMITMENTS AND CONTINGENCIES

6 Months Ended

Jun. 30, 2013

COMMITMENTS AND CONTINGENCIES

COMMITMENTS AND CONTINGENCIES

10. COMMITMENTS AND CONTINGENCIES

Commitments

        The Company leases corporate office space in Houston and Plano, Texas; Tulsa, Oklahoma; Denver, Colorado; and Williston, North Dakota as well as a number of other field office locations. Rent expense was approximately $4.4 million and $1.2 million for the six months ended June 30, 2013 and 2012, respectively. In addition, the Company has commitments for certain equipment under long-term operating lease agreements, namely drilling rigs as well as pipeline and well equipment, with various expiration dates through 2015. Early termination of the drilling rig commitments would result in termination penalties approximating $42.6 million, which would be in lieu of the remaining $68.9 million of drilling rig commitments as of June 30, 2013. As of June 30, 2013, the amount of commitments under office and equipment lease agreements is consistent with the levels at December 31, 2012, as disclosed in the Company's Annual Report on Form 10-K, approximating $66.7 million in the aggregate, and containing various expiration dates through 2024.

Contingencies

        From time to time, the Company may be a plaintiff or defendant in a pending or threatened legal proceeding arising in the normal course of its business. While the outcome and impact of currently pending legal proceedings cannot be determined, the Company's management and legal counsel believe that the resolution of these proceedings through settlement or adverse judgment will not have a material effect on the Company's unaudited condensed consolidated operating results, financial position or cash flows.

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LONG-TERM DEBT

6 Months Ended

Jun. 30, 2013

LONG-TERM DEBT

LONG-TERM DEBT

6. LONG-TERM DEBT

        Long-term debt as of June 30, 2013 and December 31, 2012 consisted of the following:

	June 30, 2013		December 31, 2012(1)
	(In thousands)
Senior revolving credit facility	$	343,000	$	298,000
8.875% $1.35 billion senior notes(2)		1,373,429		744,421
9.75% $750 million senior notes(3)		740,669		740,232
8.0% $275 million convertible note(4)		255,460		251,845
Deferred premiums on derivative contracts		1,389		—
	$	2,713,947	$	2,034,498

⁽¹⁾

Table excludes $74.7 million of promissory notes which were classified as current at December 31, 2012.

⁽²⁾

Amount is net of a $5.4 million and a $5.6 million unamortized discount at June 30, 2013 and December 31, 2012, respectively, related to the issuance of the original 2021 Notes. On January 14, 2013, the Company completed the issuance of an additional $600 million of its 2021 Notes. The unamortized premium related to these additional 2021 Notes was approximately $28.8 million at June 30, 2013. See "8.875% Senior Notes" below for more details.

⁽³⁾

Amount is net of a $9.3 million and a $9.8 million unamortized discount at June 30, 2013 and December 31, 2012, respectively. See "9.75% Senior Notes" below for more details.

⁽⁴⁾

Amount is net of a $34.2 million and a $37.8 million unamortized discount at June 30, 2013 and December 31, 2012, respectively. See "8.0% Convertible Note" below for more details.

Senior Revolving Credit Facility

        In connection with the closing of the Recapitalization, discussed in Note 2, "Recapitalization," the Company entered into a senior secured revolving credit agreement (the Senior Credit Agreement) with JPMorgan Chase Bank, N.A., as administrative agent, and the other lenders party thereto on February 8, 2012. The Senior Credit Agreement provides for a $1.5 billion facility with a current borrowing base of $810.0 million. Amounts borrowed under the Senior Credit Agreement will mature on February 8, 2017. The borrowing base will be redetermined semi-annually, with the lenders and the Company each having the right to one interim unscheduled redetermination between any two consecutive semi-annual redeterminations. The borrowing base takes into account the Company's oil and natural gas properties, proved reserves, total indebtedness, and other relevant factors consistent with customary oil and natural gas lending criteria. The borrowing base is subject to a reduction equal to the product of 0.25 multiplied by the stated principal amount (without regard to any initial issue discount) of any future notes or other long-term debt securities that the Company may issue. Funds advanced under the Senior Credit Agreement may be paid down and re-borrowed during the five-year term of the revolver. Amounts outstanding under the Senior Credit Agreement bear interest at specified margins over the base rate of 0.50% to 1.50% for ABR-based loans or at specified margins over LIBOR of 1.50% to 2.50% for Eurodollar-based loans. These margins fluctuate based on the Company's utilization of the facility. Advances under the Senior Credit Agreement are secured by liens on substantially all of the Company's properties and assets. The Senior Credit Agreement contains customary representations, warranties and covenants including, among others, restrictions on the payment of dividends on the Company's capital stock and financial covenants, including minimum working capital levels (the ratio of current assets plus the unused commitment under the Senior Credit Agreement to current liabilities) of not less than 1.0 to 1.0 and minimum coverage of interest expenses (as defined in the Senior Credit Agreement) of not less than 2.5 to 1.0.

        At June 30, 2013, the Company had $343.0 million of indebtedness outstanding, $1.2 million of letters of credit outstanding and $505.8 million of borrowing capacity available under the Senior Credit Agreement. At June 30, 2013, the Company was in compliance with the financial debt covenants under the Senior Credit Agreement. Upon the closing of the Eagle Ford divestiture, the borrowing base under the Senior Credit Agreement was reduced from $850.0 million to $810.0 million. See Note 15, "Subsequent Event" for further discussion of this transaction.

        On January 25, 2013, the Company entered into the Second Amendment (the Second Amendment) which amends the Senior Credit Agreement with respect to the Company's ability to enter into certain commodity hedging agreements. The Second Amendment provides, among other things, that the Company and its subsidiaries may enter into commodity swap, collar and/or call option agreements with approved counterparties so long as the volumes for such agreements do not exceed 85% of the Company's internally forecasted production from (i) the Company's crude oil, natural gas liquids and natural gas, or (ii) in the case of a proposed acquisition of oil and gas properties, such oil and gas properties that are the subject of such proposed acquisition, in each case for the 24 months following the date such agreement is entered into. Additionally, the Company may enter into commodity swap, collar and/or call option agreements so long as the volumes for such agreements do not exceed 85% of (i) the reasonably anticipated projected production from the Company's proved reserves for the period of 25 to 66 months following the date such agreement is entered into, or (ii) in the case of a proposed acquisition of oil and gas properties, the reasonably anticipated projected production from proved reserves from such oil and gas properties that are the subject of such proposed acquisition for the period of 25 to 48 months following the date such agreement is entered into. The 85% limitations discussed above do not apply to volumes hedged by the Company using puts, floors and/or basis differential swap agreements.

        Prior to the Second Amendment, the volumes for commodity swap, collar and/or call option agreements under the Senior Credit Agreement could not exceed 85% of the reasonably anticipated projected production from the Company's proved reserves (as forecast based upon the most recently delivered reserve report), for each month during the period during which the agreement was in effect for each of crude oil, natural gas liquids and natural gas, for the 66 months following the date such agreement was entered into.

        On April 26, 2013, the Company entered into the Third Amendment which amends the Senior Credit Agreement in order to provide, among other things, additional flexibility under certain affirmative and negative covenants.

        On May 8, 2013, the Company entered into the Fourth Amendment to the Senior Credit Agreement (the Fourth Amendment). The Fourth Amendment provides for EBITDA (as defined in the Senior Credit Agreement) to be annualized for the balance of calendar year 2013 for purposes of measuring compliance with the interest coverage test. Specifically, (i) for the fiscal quarter ended June 30, 2013, the Interest Coverage Ratio shall be calculated by utilizing EBITDA for the three month period then ended multiplied by 4; (ii) for the fiscal quarter ended September 30, 2013, the Interest Coverage Ratio shall be calculated by utilizing EBITDA for the six month period then ended multiplied by 2; and (iii) for the fiscal quarter ended December 31, 2013, the Interest Coverage Ratio shall be calculated by utilizing EBITDA for the nine month period then ended multiplied by 4/3.

        On June 11, 2013, the Company entered into the Fifth Amendment to the Senior Credit Agreement (the Fifth Amendment). The Fifth Amendment provides, among other things, for the Company to pay cash dividends to holders of the Company's preferred capital stock.

8.875% Senior Notes

        On November 6, 2012, the Company issued $750 million aggregate principal amount of its 8.875% senior notes due 2021 (the 2021 Notes), at a price to the initial purchasers of 99.247% of par. The net proceeds from the offering of approximately $725.6 million (after deducting the initial purchasers' discounts, commissions and offering expenses) were used to fund a portion of the cash consideration paid in the Williston Basin Acquisition.

        On January 14, 2013, the Company issued an additional $600 million aggregate principal amount of the 2021 Notes at a price to the initial purchasers of 105% of par. The net proceeds from the sale of the additional 2021 Notes of approximately $619.5 million (after the initial purchasers' premiums, commissions and offering expenses) were used to repay all of the then outstanding borrowings under the Senior Credit Agreement and for general corporate purposes, including funding a portion of the Company's 2013 capital expenditures program. These notes were issued as "additional notes" under the indenture governing the 2021 Notes and under the indenture are treated as a single series with substantially identical terms as the 2021 Notes previously issued.

        The 2021 Notes bear interest at a rate of 8.875% per annum, payable semi-annually on May 15 and November 15 of each year, beginning on May 15, 2013. The Notes will mature on May 15, 2021. The 2021 Notes are senior unsecured obligations of the Company and rank equally with all of its current and future senior indebtedness. The 2021 Notes are jointly and severally, fully and unconditionally guaranteed on a senior unsecured basis by the Company's existing wholly-owned subsidiaries. Halcón, the issuer of the 2021 Notes, has no material independent assets or operations apart from the assets and operations of its subsidiaries.

        On June 4, 2013, the Company completed a registered exchange offer of outstanding 2021 Notes for new registered notes having terms substantially identical to the 2021 Notes.

        On or before November 15, 2015, the Company may redeem up to 35% of the aggregate principal amount of the 2021 Notes with the net cash proceeds of certain equity offerings at a redemption price of 108.875% of the principal amount plus accrued and unpaid interest to the redemption date provided that: at least 65% in aggregate principal amount of the 2021 Notes originally issued remains outstanding immediately after the redemption and the redemption occurs within 180 days of the date of closing of the related equity offering. In addition, at any time prior to November 15, 2016, the Company may redeem some or all of the 2021 Notes for the principal amount thereof, plus accrued and unpaid interest plus a make whole premium equal to the excess, if any of (a) the present value at such time of (i) the redemption price of such note at November 15, 2016, plus (ii) any required interest payments due on the notes through November 15, 2016 (excluding currently accrued and unpaid interest) computed using a discount rate equal to the Treasury Rate plus 50 basis points, discounted to the redemption date on a semi-annual basis, over (b) the principal amount of such note.

        In conjunction with the issuance of the 2021 Notes, the Company recorded a discount of approximately $5.7 million to be amortized over the remaining life of the 2021 Notes using the effective interest method. The remaining unamortized discount was $5.4 million at June 30, 2013. In conjunction with the issuance of the additional 2021 Notes, the Company recorded a premium of approximately $30.0 million to be amortized over the remaining life of the additional 2021 Notes using the effective interest method. The remaining unamortized premium was $28.8 million at June 30, 2013.

9.75% Senior Notes

        On July 16, 2012, the Company issued $750 million aggregate principal amount of 9.75% senior notes due 2020 issued at 98.646% of par (the 2020 Notes). The net proceeds from the offering were approximately $723.1 million after deducting the initial purchasers' discounts, commissions and offering expenses and were used to fund a portion of the cash consideration paid in the Merger and the East Texas Acquisition.

        The 2020 Notes bear interest at a rate of 9.75% per annum, payable semi-annually on January 15 and July 15 of each year, beginning on January 15, 2013. The 2020 Notes will mature on July 15, 2020. The 2020 Notes are senior unsecured obligations of the Company and rank equally with all of its current and future senior indebtedness. The 2020 Notes are jointly and severally, fully and unconditionally guaranteed on a senior unsecured basis by the Company's existing wholly-owned subsidiaries. Halcón, the issuer of the 2020 Notes, has no material independent assets or operations apart from the assets and operations of its subsidiaries.

        On June 4, 2013, the Company completed a registered exchange offer of outstanding 2020 Notes for new registered notes having terms substantially identical to the 2020 Notes.

        On or before July 15, 2015, the Company may redeem up to 35% of the aggregate principal amount of the 2020 Notes with the net cash proceeds of certain equity offerings at a redemption price of 109.750% of the principal amount plus accrued and unpaid interest to the redemption date provided that: at least 65% in aggregate principal amount of the 2020 Notes originally issued remains outstanding immediately after the redemption and the redemption occurs within 180 days of the equity offering. In addition, at any time prior to July 15, 2016, the Company may redeem some or all of the 2020 Notes for the principal amount thereof, plus accrued and unpaid interest plus a make whole premium equal to the excess , if any of (a) the present value at such time of (i) the redemption price of such note at July 15, 2016, plus (ii) any required interest payments due on the notes through July 15, 2016 (excluding currently accrued and unpaid interest) computed using a discount rate equal to the Treasury Rate plus 50 basis points, discounted to the redemption date on a semi-annual basis, over (b) the principal amount of such note.

        In conjunction with the issuance of the 2020 Notes, the Company recorded a discount of approximately $10.2 million to be amortized over the remaining life of the 2020 Notes using the effective interest method. The remaining unamortized discount was $9.3 million at June 30, 2013.

8.0% Convertible Note

        On February 8, 2012, the Company issued the 2017 Note in the principal amount of $275.0 million together with the February 2012 Warrants for an aggregate purchase price of $275.0 million. The 2017 Note bears interest at a rate of 8% per annum, payable quarterly on March 31, June 30, September 30 and December 31 of each year and matures on February 8, 2017. Through the March 31, 2014 interest payment date, the Company may elect to pay-in-kind, by adding to the principal of the 2017 Note, all or any portion of the interest due on the 2017 Note. The Company elected to pay the interest in kind on March 31, June 30 and September 30, 2012, and rolled $3.2 million, $5.7 million and $5.8 million of interest incurred during the first, second and third quarters of 2012, respectively, into the 2017 Note, increasing the principal amount to $289.7 million. The Company did not elect to pay-in-kind interest for the quarterly payments due subsequent to September 30, 2012. At any time after February 8, 2014, the noteholder may elect to convert all or any portion of the principal amount and accrued but unpaid interest into common stock. Each $4.50 of principal and accrued but unpaid interest is convertible into one share of the Company's common stock. The 2017 Note is a senior unsecured obligation of the Company.

        The Company allocated the proceeds received for the 2017 Note and February 2012 Warrants on a relative fair value basis. Consequently, the Company recorded a discount of $43.6 million to be amortized over the remaining life of the 2017 Note utilizing the effective interest rate method. The remaining unamortized discount was $34.2 million at June 30, 2013.

Promissory Notes

        On December 28, 2012, the Company completed the acquisition of certain oil and natural gas properties in Brazos County, Texas for approximately $83.7 million, before and subject to, customary closing adjustments, consisting of approximately $8.4 million in cash and approximately $75.3 million in promissory notes. During the six months ended June 30, 2013, the Company completed its review of the properties and paid approximately $62.4 million during the period for properties deemed to have clear title and no defects. In addition, notice was given to the sellers of the Company's assertion of title and environmental defects amounting to $12.9 million for the remaining properties. The promissory notes were classified as current at December 31, 2012.

        In conjunction with the issuance of the promissory notes in December 2012, the Company recorded a discount of approximately $0.6 million to be amortized over the remaining life of the promissory notes using the effective interest method. The Company expensed the discount during the first quarter of 2013.

Debt Issuance Costs

        The Company capitalizes certain direct costs associated with the issuance of long-term debt and amortizes such costs over the lives of the respective debt. During the first six months of 2013, the Company capitalized approximately $11.5 million in costs associated with the issuance of the additional 2021 Notes and costs incurred for amendments to the Company's Senior Credit Agreement. At June 30, 2013 and December 31, 2012, the Company had approximately $59.3 million and $51.6 million, respectively, of unamortized debt issuance costs.

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FINANCIAL STATEMENT PRESENTATION

6 Months Ended

Jun. 30, 2013

FINANCIAL STATEMENT PRESENTATION

FINANCIAL STATEMENT PRESENTATION

1. FINANCIAL STATEMENT PRESENTATION

Basis of Presentation and Principles of Consolidation

        Halcón Resources Corporation (Halcón or the Company) is an independent energy company focused on the acquisition, production, exploration and development of onshore liquids-rich assets in the United States. The unaudited condensed consolidated financial statements include the accounts of all majority owned, controlled subsidiaries. The Company operates in one segment which focuses on oil and natural gas acquisition, production, exploration and development. The Company's oil and natural gas properties are managed as a whole rather than through discrete operating areas. Operational information is tracked by operating area; however, financial performance is assessed as a whole. Allocation of capital is made across the Company's entire portfolio without regard to operating area. All intercompany accounts and transactions have been eliminated. These unaudited condensed consolidated financial statements reflect, in the opinion of the Company's management, all adjustments, consisting of normal and recurring adjustments, necessary to present fairly the financial position as of, and the results of operations for, the periods presented. During interim periods, Halcón follows the accounting policies disclosed in its 2012 Annual Report on Form 10-K, as filed with the United States Securities and Exchange Commission (SEC). Please refer to the footnotes in the 2012 Annual Report on Form 10-K when reviewing interim financial results.

        As discussed in Item 8. Consolidated Financial Statements and Supplementary Data—Note 2, "Corrections of Immaterial Errors," to the Company's Annual Report on Form 10-K for the year ended December 31, 2012, the consolidated balance sheet as of December 31, 2011 was restated to reflect the correction of $4.3 million of tax basis adjustments to "Oil and natural gas properties" and "Deferred income taxes" for periods prior to January 1, 2007, and as such, the accumulated deficit and stockholders' equity balances of $242.0 million and $680.9 million, respectively, reported on the Company's Quarterly Report on Form 10-Q for the six months ended June 30, 2012 have been adjusted to $246.3 million and $676.6 million, respectively.

Consolidated Financial Statements

        The unaudited condensed consolidated financial statements include the accounts of Halcón and its majority-owned subsidiaries. The equity method is used to account for investments in affiliates in which the Company does not have majority ownership, but has the ability to exert significant influence. The Company's investments in oil and natural gas limited partnerships for which it serves as general partner and exerts significant influence are accounted for under the equity method. All intercompany accounts and transactions have been eliminated.

Use of Estimates

        The preparation of the Company's unaudited condensed consolidated financial statements in conformity with accounting principles generally accepted in the United States requires the Company's management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities, if any, at the date of the unaudited condensed consolidated financial statements and the reported amounts of revenues and expenses during the respective reporting periods. Estimates and assumptions that, in the opinion of management of the Company, are significant include oil and natural gas revenue, capital and operating expense accruals, oil and natural gas reserves, depletion relating to oil and natural gas properties, asset retirement obligations, fair value estimates, beneficial conversion feature estimates and income taxes. The Company bases its estimates and judgments on historical experience and on various other assumptions and information that are believed to be reasonable under the circumstances. Estimates and assumptions about future events and their effects cannot be perceived with certainty and, accordingly, these estimates may change as new events occur, as more experience is acquired, as additional information is obtained and as the Company's operating environment changes. Actual results may differ from the estimates and assumptions used in the preparation of the Company's unaudited condensed consolidated financial statements.

        Interim period results are not necessarily indicative of results of operations or cash flows for the full year and accordingly, certain information normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States, has been condensed or omitted. The Company has evaluated events or transactions through the date of issuance of these unaudited condensed consolidated financial statements.

Accounts Receivable and Allowance for Doubtful Accounts

        The Company's accounts receivable are primarily receivables from joint interest owners and oil and natural gas purchasers. Accounts receivable are recorded at the amount due, less an allowance for doubtful accounts, when applicable. The Company establishes provisions for losses on accounts receivable if it determines that collection of all or part of the outstanding balance is doubtful. The Company regularly reviews collectability and establishes or adjusts the allowance for doubtful accounts as necessary using the specific identification method. There are no significant allowances for doubtful accounts as of June 30, 2013 or December 31, 2012.

Other Operating Property and Equipment

        Gas gathering systems and equipment are recorded at cost. Depreciation is calculated using the straight-line method over a 30-year estimated useful life. Upon disposition, the cost and accumulated depreciation are removed and any gains or losses are reflected in current operations. Maintenance and repair costs are charged to operating expense as incurred. Material expenditures which increase the life of an asset or productive capacity are capitalized and depreciated over the estimated remaining useful life of the asset. The Company has capitalized $112.0 million and $39.9 million as of June 30, 2013 and December 31, 2012, respectively, related to the construction of its gas gathering systems.

        Other operating assets are recorded at cost. Depreciation is calculated using the straight-line method over the following estimated useful lives: automobiles and computers, three years; computer software, leasehold improvements, fixtures, furniture and equipment, five years or the lesser of lease term; trailers, seven years; heavy equipment, ten years; and an airplane and buildings, twenty years. Upon disposition, the cost and accumulated depreciation are removed and any gains or losses are reflected in current operations. Maintenance and repair costs are charged to operating expense as incurred. Material expenditures which increase the life of an asset are capitalized and depreciated over the estimated remaining useful life of the asset.

        The Company reviews its gas gathering systems and equipment and other operating assets for impairment in accordance with ASC 360, Property, Plant, and Equipment (ASC 360). ASC 360 requires the Company to evaluate gas gathering systems and equipment and other operating assets for impairment as events occur or circumstances change that would more likely than not reduce the fair value below the carrying amount. If the carrying amount is not recoverable from its undiscounted cash flows, then the Company would recognize an impairment loss for the difference between the carrying amount and the current fair value. Further, the Company evaluates the remaining useful lives of its gas gathering systems and other operating assets at each reporting period to determine whether events and circumstances warrant a revision to the remaining depreciation periods.

Goodwill

        Goodwill represents the excess of the purchase price over the estimated fair value of the assets acquired net of the fair value of liabilities assumed in an acquisition. ASC 350, Intangibles—Goodwill and Other (ASC 350) requires that intangible assets with indefinite lives, including goodwill, be evaluated on an annual basis for impairment or more frequently if events occur or circumstances change that could potentially result in impairment. The goodwill impairment test requires the allocation of goodwill and all other assets and liabilities to reporting units. However, the Company has only one reporting unit. The Company's goodwill relates to its acquisition of GeoResources. Refer to Note 4, "Acquisitions" for more details regarding the Merger between the Company and GeoResources. The Company will perform its goodwill impairment test annually as of July 1, beginning in the third quarter of 2013, or more often if circumstances require.

Recently Issued Accounting Pronouncements

        In December 2011, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) No. 2011-11, Disclosures about Offsetting Assets and Liabilities (ASU 2011-11), which enhances disclosures by requiring an entity to disclose information about netting arrangements, including rights of offset, to enable users of its financial statements to understand the effect of those arrangements on its financial position. This pronouncement was issued to facilitate comparison between financial statements prepared on the basis of accounting principles generally accepted in the United States and International Financial Reporting Standards. In addition, in January 2013, the FASB issued ASU No. 2013-01, Clarifying the Scope of Disclosures about Offsetting Assets and Liabilities (ASU 2013-01), which requires clarification of the specific instruments that should be considered in the offsetting disclosures. These updates are effective for annual and interim reporting periods beginning on or after January 1, 2013 and are to be applied retroactively for all comparative periods presented. The adoption of ASU 2011-11 and ASU 2013-01 resulted in new disclosures related to the Company's derivative activities. See further information at Note 8, "Derivative and Hedging Activities."

        In February 2013, the FASB issued ASU No. 2013-04, Obligations Resulting from Joint and Several Liability Arrangements for which the Total Amount of the Obligation is Fixed at the Reporting Date (ASU 2013-04). ASU 2013-04 provides guidance for the recognition, measurement, and disclosure of obligations resulting from joint and several liability arrangements, such as debt arrangements, other contractual obligations and settled litigation and judicial rulings. This pronouncement must be applied retrospectively and is effective for fiscal years, and interim periods within those years, beginning after December 15, 2013. The Company is currently assessing the impact, if any, that the adoption of ASU 2013-04 will have on its operating results, financial position and disclosures.

        In February 2013, the FASB issued ASU No. 2013-11, Presentation of an Unrecognized Tax Benefit When a Net Operating Loss Carryforward, a Similar Tax Loss, or a Tax Credit Carryforward Exists (ASU 2013-11). ASU 2013-11 provides explicit guidance on the financial statement presentation of an unrecognized tax benefit when a net operating loss carryforward, a similar tax loss, or a tax credit carryforward exists. This pronouncement should be applied prospectively to all unrecognized tax benefits that exist at the effective date and retrospective application is permitted. ASU 2013-11 is effective for fiscal years, and interim periods within those years, beginning after December 15, 2013. The Company is currently assessing the impact, if any, that the adoption of this pronouncement will have on its operating results and financial position.

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COMMITMENTS AND CONTINGENCIES (Details) (USD $) In Millions, unless otherwise specified	6 Months Ended
	Jun. 30, 2013	Jun. 30, 2012
COMMITMENTS AND CONTINGENCIES
Rent expense	$ 4.4	$ 1.2
Non-cancelable termination penalties	42.6
Total Obligation Amount
Drilling rig commitments	68.9
Office and equipment lease agreements amount	$ 66.7

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FAIR VALUE MEASUREMENTS (Details 2) (USD $)	Jun. 30, 2013	Dec. 31, 2012	Jun. 30, 2013 8.875% Senior Notes	Jan. 14, 2013 8.875% Senior Notes	Dec. 31, 2012 8.875% Senior Notes	Nov. 06, 2012 8.875% Senior Notes	Jun. 30, 2013 9.75% Senior Notes	Dec. 31, 2012 9.75% Senior Notes	Jul. 16, 2012 9.75% Senior Notes	Jun. 30, 2013 8% convertible Note	Dec. 31, 2012 8% convertible Note	Feb. 08, 2012 8% convertible Note	Jun. 30, 2013 Carrying value	Dec. 31, 2012 Carrying value	Jun. 30, 2013 Carrying value 8.875% Senior Notes	Dec. 31, 2012 Carrying value 8.875% Senior Notes	Jun. 30, 2013 Carrying value 9.75% Senior Notes	Dec. 31, 2012 Carrying value 9.75% Senior Notes	Jun. 30, 2013 Carrying value 8% convertible Note	Dec. 31, 2012 Carrying value 8% convertible Note
Fair value measurements
Interest rate (as a percent)			8.875%	8.875%	8.875%	8.875%	9.75%	9.75%	9.75%	8.00%	8.00%	8.00%
Principal amount			$ 1,350,000,000		$ 1,350,000,000	$ 750,000,000	$ 750,000,000	$ 750,000,000	$ 750,000,000	$ 275,000,000	$ 275,000,000	$ 275,000,000
Estimated fair value of debt	$ 2,532,655,000	$ 2,239,335,000	$ 1,316,250,000		$ 798,750,000		$ 753,750,000	$ 815,160,000		$ 462,655,000	$ 625,425,000		$ 2,389,669,000	$ 1,789,669,000	$ 1,350,000,000	$ 750,000,000	$ 750,000,000	$ 750,000,000	$ 289,669,000	$ 289,669,000

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RECAPITALIZATION (Details) (USD $)	1 Months Ended	6 Months Ended			1 Months Ended			1 Months Ended			1 Months Ended									1 Months Ended				1 Months Ended		1 Months Ended
	Feb. 29, 2012 item	Jun. 30, 2013	Jun. 30, 2012	Dec. 31, 2012	Feb. 29, 2012 Plan	Feb. 28, 2012 2017 Note	Feb. 08, 2012 2017 Note	Feb. 29, 2012 Revolving credit facility	Feb. 29, 2012 Second lien term facility	Feb. 29, 2012 February 2012 Warrants	Jan. 31, 2012 Common Stock	Jan. 17, 2013 Common Stock	Feb. 08, 2012 Common Stock	May 23, 2013 Common Stock Plan	May 17, 2012 Common Stock Plan	Feb. 08, 2012 Common Stock Plan	May 03, 2010 Common Stock Plan	May 08, 2008 Common Stock Plan	May 08, 2006 Common Stock Plan	Dec. 31, 2011 The Purchase Agreement HALRES 2017 Note	Dec. 31, 2011 The Purchase Agreement HALRES February 2012 Warrants	Feb. 28, 2012 The Purchase Agreement HALRES February 2012 Warrants	Dec. 21, 2011 The Purchase Agreement HALRES February 2012 Warrants	Dec. 31, 2011 The Purchase Agreement HALRES Common Stock	Dec. 21, 2011 The Purchase Agreement HALRES Common Stock	Dec. 31, 2011 The Purchase Agreement HALRES Common Stock 2017 Note	Dec. 21, 2011 The Purchase Agreement HALRES Common Stock 2017 Note
Recapitalization
Shares sold under agreement that will be issued at closing																									73,300,000
Purchase price of shares sold under agreement																								$ 275,000,000
Principal amount						275,000,000														275,000,000
Term																					5 years
Number of shares of common stock that can be purchased from warrants										36,700,000												36,700,000
Exercise price (in dollars per share)										$ 4.50													$ 4.50
Convertible shares of common stock																										61,100,000
Amount of principal and accrued interest that is convertible into one share of the entity's common stock (in dollars per share)							$ 4.50																				$ 4.50
Common stock shares authorized before amendment											100,000,000
Common stock shares authorized after amendment but before reverse stock split											1,010,000,000
Reverse stock split ratio											0.333
Common stock, shares authorized		670,000,000		336,666,666								670,000,000	336,700,000
Shares issuable under the plan														41,500,000	11,500,000	3,700,000	2,500,000	2,000,000	800,000
Material events and items from recapitalization transaction
Number of executive officers resigned or terminated	4
Change in control payments to the officers recorded in general and administrative expense	4,600,000
Change in control payment pursuant to a retainer agreement	800,000
Change in control accelerated vesting of share-based compensation awards, recorded in general and administrative expense					4,300,000
Payoff and termination of credit facility		915,400,000	208,000,000					133,000,000	75,000,000
Related unamortized debt issue costs								2,900,000	2,900,000
Debt prepayment fee									1,500,000
Closing costs related to engagement fees and various professional fees	11,200,000
Termination fee related to previous engagement	$ 2,500,000

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EARNINGS PER COMMON SHARE

6 Months Ended

Jun. 30, 2013

EARNINGS PER COMMON SHARE

EARNINGS PER COMMON SHARE

13. EARNINGS PER COMMON SHARE

        The following represents the calculation of earnings (loss) per share (in thousands, except per share amounts):

	Three Months Ended June 30,					Six Months Ended June 30,
	2013		2012			2013		2012
	(In thousands, except per share amounts)
Basic:
Net income (loss) available to common stockholders	$	36,372	$	(79,684	)	$	41,837	$	(114,108	)
Weighted average basic number of common shares outstanding		366,712		136,066			356,482		102,441
Basic net income (loss) per share of common stock	$	0.10	$	(0.59	)	$	0.12	$	(1.11	)
Diluted:
Net income (loss) available to common stockholders	$	36,372	$	(79,684	)	$	41,837	$	(114,108	)
Interest on convertible debt, net		974		—			1,974		—
Net income (loss) available to common stockholders after assumed conversions	$	37,346	$	(79,684	)	$	43,811	$	(114,108	)
Weighted average basic number of common shares outstanding		366,712		136,066			356,482		102,441
Common stock equivalent shares representing shares issuable upon exercise of stock options		Anti-dilutive		Anti-dilutive			Anti-dilutive		Anti-dilutive
Common stock equivalent shares representing shares issuable upon exercise of Febuary 2012 Warrants		9,954		Anti-dilutive			12,183		Anti-dilutive
Common stock equivalent shares representing shares issuable upon exercise of August 2012 Warrants		Anti-dilutive		—			Anti-dilutive		—
Common stock equivalent shares representing shares included upon vesting of restricted shares		108		Anti-dilutive			682		Anti-dilutive
Common stock equivalent shares representing shares issuable upon conversion of 2017 Notes		64,371		Anti-dilutive			32,185		Anti-dilutive
Common stock equivalent shares representing shares issuable upon conversion of preferred stock		—		—			10,880		Anti-dilutive
Common stock equivalent shares representing shares issuable upon conversion of Series A Preferred Stock		Anti-dilutive		—			Anti-dilutive		—
Weighted average diluted number of common shares outstanding		441,145		136,066			412,412		102,441
Diluted net income (loss) per share of common stock	$	0.08	$	(0.59	)	$	0.11	$	(1.11	)

        Common stock equivalents, including stock options, warrants, restricted shares, convertible debt, and preferred stock, totaling 17.1 million and 43.9 million shares for the three and six months ended June 30, 2013, respectively, were not included in the computation of diluted earnings per share of common stock because the effect would have been anti-dilutive. Common stock equivalents of stock options, preferred stock, warrants and the 2017 Note totaling 89.4 million and 75.4 million shares for the three and six months ended June 30, 2012, respectively, were not included in the computations of diluted earnings per share of common stock because the effect would have been anti-dilutive due to the net losses.

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ASSET RETIREMENT OBLIGATIONS

6 Months Ended

Jun. 30, 2013

ASSET RETIREMENT OBLIGATIONS

ASSET RETIREMENT OBLIGATIONS

9. ASSET RETIREMENT OBLIGATIONS

        The Company records an asset retirement obligation (ARO) when it can reasonably estimate the fair value of an obligation to perform site reclamation, dismantle facilities or plug and abandon costs. For gas gathering systems and equipment, the Company records an ARO when the system is placed in service and it can reasonably estimate the fair value of an obligation to perform site reclamation and other necessary work when it is required. The Company records the ARO liability on the unaudited condensed consolidated balance sheets and capitalizes a portion of the cost in "Oil and natural gas properties" or "Other operating property and equipment" during the period in which the obligation is incurred. The Company records the accretion of its ARO liabilities in "Depletion, depreciation and accretion" expense in the unaudited condensed consolidated statements of operations. The additional capitalized costs are depreciated on a unit-of-production basis or straight-line basis.

        The Company recorded the following activity related to its ARO liability for the six months ended June 30, 2013 (in thousands, inclusive of the current portion):

Liability for asset retirement obligations as of December 31, 2012	$	75,132
Liabilities settled and divested		(265	)
Additions		5,037
Acquisitions		1,055
Accretion expense		1,825
Revisions in estimated cash flows		(433	)
Liability for asset retirement obligations as of June 30, 2013	$	82,351

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FINANCIAL STATEMENT PRESENTATION (Policies)

6 Months Ended

Jun. 30, 2013

FINANCIAL STATEMENT PRESENTATION

Basis of Presentation and Principles of Consolidation

Basis of Presentation and Principles of Consolidation

        Halcón Resources Corporation (Halcón or the Company) is an independent energy company focused on the acquisition, production, exploration and development of onshore liquids-rich assets in the United States. The unaudited condensed consolidated financial statements include the accounts of all majority owned, controlled subsidiaries. The Company operates in one segment which focuses on oil and natural gas acquisition, production, exploration and development. The Company's oil and natural gas properties are managed as a whole rather than through discrete operating areas. Operational information is tracked by operating area; however, financial performance is assessed as a whole. Allocation of capital is made across the Company's entire portfolio without regard to operating area. All intercompany accounts and transactions have been eliminated. These unaudited condensed consolidated financial statements reflect, in the opinion of the Company's management, all adjustments, consisting of normal and recurring adjustments, necessary to present fairly the financial position as of, and the results of operations for, the periods presented. During interim periods, Halcón follows the accounting policies disclosed in its 2012 Annual Report on Form 10-K, as filed with the United States Securities and Exchange Commission (SEC). Please refer to the footnotes in the 2012 Annual Report on Form 10-K when reviewing interim financial results.

        As discussed in Item 8. Consolidated Financial Statements and Supplementary Data—Note 2, "Corrections of Immaterial Errors," to the Company's Annual Report on Form 10-K for the year ended December 31, 2012, the consolidated balance sheet as of December 31, 2011 was restated to reflect the correction of $4.3 million of tax basis adjustments to "Oil and natural gas properties" and "Deferred income taxes" for periods prior to January 1, 2007, and as such, the accumulated deficit and stockholders' equity balances of $242.0 million and $680.9 million, respectively, reported on the Company's Quarterly Report on Form 10-Q for the six months ended June 30, 2012 have been adjusted to $246.3 million and $676.6 million, respectively.

Consolidated Financial Statements

Consolidated Financial Statements

        The unaudited condensed consolidated financial statements include the accounts of Halcón and its majority-owned subsidiaries. The equity method is used to account for investments in affiliates in which the Company does not have majority ownership, but has the ability to exert significant influence. The Company's investments in oil and natural gas limited partnerships for which it serves as general partner and exerts significant influence are accounted for under the equity method. All intercompany accounts and transactions have been eliminated.

Use of Estimates

Use of Estimates

        The preparation of the Company's unaudited condensed consolidated financial statements in conformity with accounting principles generally accepted in the United States requires the Company's management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities, if any, at the date of the unaudited condensed consolidated financial statements and the reported amounts of revenues and expenses during the respective reporting periods. Estimates and assumptions that, in the opinion of management of the Company, are significant include oil and natural gas revenue, capital and operating expense accruals, oil and natural gas reserves, depletion relating to oil and natural gas properties, asset retirement obligations, fair value estimates, beneficial conversion feature estimates and income taxes. The Company bases its estimates and judgments on historical experience and on various other assumptions and information that are believed to be reasonable under the circumstances. Estimates and assumptions about future events and their effects cannot be perceived with certainty and, accordingly, these estimates may change as new events occur, as more experience is acquired, as additional information is obtained and as the Company's operating environment changes. Actual results may differ from the estimates and assumptions used in the preparation of the Company's unaudited condensed consolidated financial statements.

        Interim period results are not necessarily indicative of results of operations or cash flows for the full year and accordingly, certain information normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States, has been condensed or omitted. The Company has evaluated events or transactions through the date of issuance of these unaudited condensed consolidated financial statements.

Accounts Receivable and Allowance for Doubtful Accounts

Accounts Receivable and Allowance for Doubtful Accounts

        The Company's accounts receivable are primarily receivables from joint interest owners and oil and natural gas purchasers. Accounts receivable are recorded at the amount due, less an allowance for doubtful accounts, when applicable. The Company establishes provisions for losses on accounts receivable if it determines that collection of all or part of the outstanding balance is doubtful. The Company regularly reviews collectability and establishes or adjusts the allowance for doubtful accounts as necessary using the specific identification method. There are no significant allowances for doubtful accounts as of June 30, 2013 or December 31, 2012.

Other Operating Property and Equipment

Other Operating Property and Equipment

        Gas gathering systems and equipment are recorded at cost. Depreciation is calculated using the straight-line method over a 30-year estimated useful life. Upon disposition, the cost and accumulated depreciation are removed and any gains or losses are reflected in current operations. Maintenance and repair costs are charged to operating expense as incurred. Material expenditures which increase the life of an asset or productive capacity are capitalized and depreciated over the estimated remaining useful life of the asset. The Company has capitalized $112.0 million and $39.9 million as of June 30, 2013 and December 31, 2012, respectively, related to the construction of its gas gathering systems.

        Other operating assets are recorded at cost. Depreciation is calculated using the straight-line method over the following estimated useful lives: automobiles and computers, three years; computer software, leasehold improvements, fixtures, furniture and equipment, five years or the lesser of lease term; trailers, seven years; heavy equipment, ten years; and an airplane and buildings, twenty years. Upon disposition, the cost and accumulated depreciation are removed and any gains or losses are reflected in current operations. Maintenance and repair costs are charged to operating expense as incurred. Material expenditures which increase the life of an asset are capitalized and depreciated over the estimated remaining useful life of the asset.

        The Company reviews its gas gathering systems and equipment and other operating assets for impairment in accordance with ASC 360, Property, Plant, and Equipment (ASC 360). ASC 360 requires the Company to evaluate gas gathering systems and equipment and other operating assets for impairment as events occur or circumstances change that would more likely than not reduce the fair value below the carrying amount. If the carrying amount is not recoverable from its undiscounted cash flows, then the Company would recognize an impairment loss for the difference between the carrying amount and the current fair value. Further, the Company evaluates the remaining useful lives of its gas gathering systems and other operating assets at each reporting period to determine whether events and circumstances warrant a revision to the remaining depreciation periods.

Goodwill

Goodwill

        Goodwill represents the excess of the purchase price over the estimated fair value of the assets acquired net of the fair value of liabilities assumed in an acquisition. ASC 350, Intangibles—Goodwill and Other (ASC 350) requires that intangible assets with indefinite lives, including goodwill, be evaluated on an annual basis for impairment or more frequently if events occur or circumstances change that could potentially result in impairment. The goodwill impairment test requires the allocation of goodwill and all other assets and liabilities to reporting units. However, the Company has only one reporting unit. The Company's goodwill relates to its acquisition of GeoResources. Refer to Note 4, "Acquisitions" for more details regarding the Merger between the Company and GeoResources. The Company will perform its goodwill impairment test annually as of July 1, beginning in the third quarter of 2013, or more often if circumstances require.

Recently Issued Accounting Pronouncements

Recently Issued Accounting Pronouncements

        In December 2011, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) No. 2011-11, Disclosures about Offsetting Assets and Liabilities (ASU 2011-11), which enhances disclosures by requiring an entity to disclose information about netting arrangements, including rights of offset, to enable users of its financial statements to understand the effect of those arrangements on its financial position. This pronouncement was issued to facilitate comparison between financial statements prepared on the basis of accounting principles generally accepted in the United States and International Financial Reporting Standards. In addition, in January 2013, the FASB issued ASU No. 2013-01, Clarifying the Scope of Disclosures about Offsetting Assets and Liabilities (ASU 2013-01), which requires clarification of the specific instruments that should be considered in the offsetting disclosures. These updates are effective for annual and interim reporting periods beginning on or after January 1, 2013 and are to be applied retroactively for all comparative periods presented. The adoption of ASU 2011-11 and ASU 2013-01 resulted in new disclosures related to the Company's derivative activities. See further information at Note 8, "Derivative and Hedging Activities."

        In February 2013, the FASB issued ASU No. 2013-04, Obligations Resulting from Joint and Several Liability Arrangements for which the Total Amount of the Obligation is Fixed at the Reporting Date (ASU 2013-04). ASU 2013-04 provides guidance for the recognition, measurement, and disclosure of obligations resulting from joint and several liability arrangements, such as debt arrangements, other contractual obligations and settled litigation and judicial rulings. This pronouncement must be applied retrospectively and is effective for fiscal years, and interim periods within those years, beginning after December 15, 2013. The Company is currently assessing the impact, if any, that the adoption of ASU 2013-04 will have on its operating results, financial position and disclosures.

        In February 2013, the FASB issued ASU No. 2013-11, Presentation of an Unrecognized Tax Benefit When a Net Operating Loss Carryforward, a Similar Tax Loss, or a Tax Credit Carryforward Exists (ASU 2013-11). ASU 2013-11 provides explicit guidance on the financial statement presentation of an unrecognized tax benefit when a net operating loss carryforward, a similar tax loss, or a tax credit carryforward exists. This pronouncement should be applied prospectively to all unrecognized tax benefits that exist at the effective date and retrospective application is permitted. ASU 2013-11 is effective for fiscal years, and interim periods within those years, beginning after December 15, 2013. The Company is currently assessing the impact, if any, that the adoption of this pronouncement will have on its operating results and financial position.

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ADDITIONAL FINANCIAL STATEMENT INFORMATION

6 Months Ended

Jun. 30, 2013

ADDITIONAL FINANCIAL STATEMENT INFORMATION

ADDITIONAL FINANCIAL STATEMENT INFORMATION

14. ADDITIONAL FINANCIAL STATEMENT INFORMATION

        Certain balance sheet amounts are comprised of the following (in thousands):

	June 30, 2013		December 31, 2012
	(In thousands)
Accounts receivable:
Oil, natural gas and natural gas liquids revenues	$	126,193	$	143,794
Joint interest accounts		133,334		113,671
Affiliated partnerships		386		475
Other		4,303		4,869
	$	264,216	$	262,809
Prepaids and other:
Prepaids	$	6,712	$	3,690
Other		6,256		3,001
	$	12,968	$	6,691
Other noncurrent assets:
Deposits for acquisitions of oil and natural gas properties	$	36,855	$	—
Other		277		934
	$	37,132	$	934
Accounts payable and accrued liabilities:
Trade payables	$	127,324	$	147,679
Accrued oil and natural gas capital costs		358,973		282,245
Revenues and royalties payable		133,736		91,761
Accrued interest expense		52,164		45,201
Accrued income taxes payable		4		130
Accrued employee compensation		13,328		12,321
Drilling advances from partners		20,205		8,840
Accounts payable to affiliated partnerships		83		822
Other		—		1,552
	$	705,817	$	590,551

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Document and Entity Information	6 Months Ended
	Jun. 30, 2013	Jul. 25, 2013
Document and Entity Information
Entity Registrant Name	HALCON RESOURCES CORP
Entity Central Index Key	0001282648
Document Type	10-Q
Document Period End Date	Jun. 30, 2013
Amendment Flag	false
Current Fiscal Year End Date	--12-31
Entity Current Reporting Status	Yes
Entity Filer Category	Accelerated Filer
Entity Common Stock, Shares Outstanding		370,089,663
Document Fiscal Year Focus	2013
Document Fiscal Period Focus	Q2

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SUBSEQUENT EVENT

6 Months Ended

Jun. 30, 2013

SUBSEQUENT EVENT

SUBSEQUENT EVENT

15. SUBSEQUENT EVENT

        On July 19, 2013, the Company completed the sale of its interest in Eagle Ford assets in Fayette and Gonzales Counties, Texas, previously acquired as part of the Merger, to private buyers for estimated proceeds of approximately $144 million, before post-closing adjustments. The transaction had an effective date of January 1, 2013. Proceeds from the sale will be recorded as a reduction to the carrying value of the Company's full cost pool with no gain or loss recorded. Upon the closing of this transaction, the borrowing base under the Senior Credit Agreement was reduced from $850.0 million to $810.0 million.