Note 8 - Derivatives and Fair Value

9 Months Ended

Sep. 30, 2023

Notes to Financial Statements

Derivatives and Fair Value [Text Block]

8. DERIVATIVES AND FAIR VALUE

The Company uses derivative financial instruments from time to time to achieve a more predictable cash flow from crude oil production by reducing the Company’s exposure to price fluctuations. See the table below for the list of outstanding contracts as of September 30, 2023:

Settlement Period	Type of Contract	Index	Average Monthly Volumes		Weighted Average Put Price		Weighted Average Call Price
			(Bbls)		(per Bbl)		(per Bbl)
October 2023 - December 2023	Collars	Dated Brent		85,000	$	65.00	$	90.00
January 2024 - March 2024	Collars	Dated Brent		85,000	$	65.00	$	97.00
April 2024 - June 2024	Collars	Dated Brent		65,000	$	65.00	$	100.00

The following table sets forth the loss on derivative instruments on the Company’s unaudited condensed consolidated statements of operations and comprehensive income:

		Three Months Ended September 30,						Nine Months Ended September 30,
Derivative Item	Statements of Operations Line	2023			2022			2023			2022
		(in thousands)						(in thousands)
Commodity derivatives	Cash settlements paid on matured derivative contracts, net	$	1		$	(9,124	)	$	(62	)	$	(42,683	)
	Unrealized gain (loss)		(2,321	)		12,902			(2,206	)		5,161
	Derivative instruments gain (loss), net	$	(2,320	)	$	3,778		$	(2,268	)	$	(37,522	)