Related Party Transactions

12 Months Ended

Dec. 31, 2015

Related Party Transactions [Abstract]

Related Party Transactions

Related Party Transactions

LINN Energy

On December 16, 2013, the Company completed the transactions contemplated by the merger agreement between LINN Energy, LinnCo, an affiliate of LINN Energy, and Berry under which LinnCo acquired all of the outstanding common shares of Berry and the contribution agreement between LinnCo and LINN Energy, under which LinnCo contributed Berry to LINN Energy in exchange for LINN Energy units. Under the merger agreement, as amended, Berry’s shareholders received 1.68 LinnCo common shares for each Berry common share they owned, totaling 93,756,674 LinnCo common shares. Under the contribution agreement, LinnCo contributed Berry to LINN Energy in exchange for 93,756,674 newly issued LINN Energy units, after which Berry became an indirect wholly owned subsidiary of LINN Energy. Berry’s sole member is Linn Acquisition Company, LLC, a direct subsidiary of LINN Energy. See Note 2 for more information.

All former employees of the Company that were retained after the LINN Energy transaction became employees of LOI, a subsidiary of LINN Energy, and along with other LOI personnel, provide services and support to the Company in accordance with an agency agreement and power of attorney between the Company and LOI. For the years ended December 31, 2015, and December 31, 2014, and for the period from December 17, 2013 through December 31, 2013, the Company incurred management fee expenses of approximately $78 million, $86 million and $20 million, respectively, for services provided by LOI. The Company also had affiliated accounts payable due to LINN Energy of approximately $9 million and $13 million at December 31, 2015, and December 31, 2014, respectively, included in “accounts payable and accrued expenses” on the balance sheets.

During the year ended December 31, 2015, Linn Energy made capital contributions of approximately $471 million to Berry, including $250 million that was deposited on Berry’s behalf and posted as restricted cash with Berry’s lenders in connection with the reduction in its borrowing base in May 2015 (see Note 3). The $250 million may be used to satisfy obligations under the Credit Facility or may be returned to LINN Energy in the future if commodity prices improve. During the second quarter of 2014, LINN Energy made a cash capital contribution of $220 million to the Company which was used to pay in full the remaining outstanding principal amount of its approximate $205 million10.25% senior notes due June 2014 plus accrued interest.

During the year ended December 31, 2015, the Company made cash distributions of approximately $89 million to LINN Energy. During the year ended December 31, 2014, the Company made cash distributions of approximately $119 million to LINN Energy. In addition, in 2014, the Company advanced approximately $352 million, to a subsidiary of LINN Energy, of net cash proceeds from the Permian Basin Assets Sale. These proceeds were required to be used by LINN Energy on capital expenditures in respect of Berry’s operations, to repay Berry’s indebtedness or as otherwise permitted under the terms of Berry’s indentures and Credit Facility. During the twelve months ended September 30, 2015, LINN Energy spent approximately $223 million, including approximately $58 million in 2014, of capital expenditures in respect of Berry’s operations. On September 30, 2015, LINN Energy repaid in full the remaining advance of approximately $129 million to Berry. In October 2015, Berry used that cash to repay borrowings under its Credit Facility.

On December 19, 2013, the Company made a cash distribution of $435 million to LINN Energy. Also in 2013, in connection with the LINN Energy transaction, LINN Energy transferred a derivative liability of approximately $31 million to the Company.

Other

One of LINN Energy’s directors is the President and Chief Executive Officer of Superior Energy Services, Inc. (“Superior”), which provides oilfield services to the Company. For the years ended December 31, 2015, and December 31, 2014, the Company incurred expenditures of approximately $562,000 and $176,000, respectively, related to services rendered by Superior and its subsidiaries.