Acquisition (Notes)

3 Months Ended

Mar. 31, 2014

Business Combinations [Abstract]

Acquisition

Acquisition

On July 3, 2013, the Company acquired certain shallow water Gulf of Mexico shelf oil and gas properties (the “Acquired Assets”), for an aggregate cash purchase price of $188.8 million, reflecting an effective date of January 1, 2013 (collectively, the "Gulf of Mexico Acquisition"). The Acquired Assets included 16 wells located on seven platforms.

The aggregate cash purchase price of the Gulf of Mexico Acquisition was financed with the net proceeds from the sale of $200 million in principal amount of the Company's 10% Senior Notes due 2017 (the "New Notes").  In connection with the transaction, the Company recorded $5.0 million of deferred financing costs related to the New Notes and incurred $4.0 million of acquisition-related costs, including $2.6 million related to a bridge commitment fee, which were recognized as general and administrative expenses.

The Gulf of Mexico Acquisition was accounted for under the purchase method of accounting, which involves determining the fair value of the assets acquired and liabilities assumed. The fair value of proved and unevaluated oil and gas properties was estimated using the income approach based on estimated reserve quantities, costs to produce and develop reserves, and forward prices for oil and gas, which represent Level 2 and Level 3 inputs. Asset retirement obligations were determined in accordance with applicable accounting standards.

The following table summarizes the acquisition date fair values of the net assets acquired (in thousands):

Oil and gas properties	$	192,067
Unevaluated oil and gas properties	12,033
Asset retirement obligations	(15,319		)
Net assets acquired	$	188,781

The following unaudited summary pro forma financial information for the three month period ended March 31, 2013 has been prepared to give effect to the Gulf of Mexico Acquisition as if it had occurred on January 1, 2012. The pro forma financial information is not necessarily indicative of the results that might have occurred had the transaction taken place on January 1, 2012 and is not intended to be a projection of future results. Future results may vary significantly from the results reflected in the following pro forma financial information because of normal production declines, changes in commodity prices, future acquisitions and divestitures, future development and exploration activities and other factors. Amounts in millions, except per share amounts.

	Three Months Ended
	March 31, 2013
Revenues	$	51,752
Income from operations	4,823
Income available to common stockholders	3,194
Basic earnings per share	$	0.05
Diluted earnings per share	$	0.05