Quarterly report pursuant to Section 13 or 15(d)

Segment Information

v3.19.3
Segment Information
9 Months Ended
Sep. 30, 2019
Segment Information [Abstract]  
Segment Information 4. SEGMENT INFORMATION

The Company’s operations are based in Gabon and the Company has an undeveloped block in Equatorial Guinea. Each of the Company’s two reportable operating segments is organized and managed based upon geographic location. The Company’s Chief Executive Officer, who is the chief operating decision maker, and management review and evaluate the operation of each geographic segment separately primarily based on operating income (loss). The operations of all segments include exploration for and production of hydrocarbons where commercial reserves have been found and developed. Revenues are based on the location of hydrocarbon production. Corporate and other is primarily corporate and operations support costs that are not allocated to the reportable operating segments.

Segment activity of continuing operations for the three and nine months ended September 30, 2019 and 2018 as well as long-lived assets and segment assets at September 30, 2019 and December 31, 2018 are as follows:

Three Months Ended September 30, 2019

(in thousands)

Gabon

Equatorial Guinea

Corporate and Other

Total

Revenues-oil and natural gas sales

$

17,603

$

$

$

17,603

Depreciation, depletion and amortization

1,437

72

1,509

Operating income (loss)

6,048

(54)

(4,493)

1,501

Derivatives instruments loss, net

2,267

2,267

Income tax expense

4,774

2,907

7,681

Additions to oil and natural gas properties and equipment – accrual

6,112

6,112

Nine Months Ended September 30, 2019

(in thousands)

Gabon

Equatorial Guinea

Corporate and Other

Total

Revenues-oil and natural gas sales

$

62,598

$

$

$

62,598

Depreciation, depletion and amortization

4,751

220

4,971

Other operating income (expense), net

(4,436)

35

(4,401)

Operating income (loss)

24,541

(370)

(10,754)

13,417

Derivatives instruments loss, net

2,266

2,266

Other, net

(333)

(4)

(184)

(521)

Interest income

4

577

581

Income tax expense

15,134

12

4,496

19,642

Additions to oil and natural gas properties and equipment – accrual

8,386

(187)

220

8,419

Three Months Ended September 30, 2018

(in thousands)

Gabon

Equatorial Guinea

Corporate and Other

Total

Revenues-oil and natural gas sales

$

25,265

$

$

1

$

25,266

Depreciation, depletion and amortization

1,065

65

1,130

Gain on revision of asset retirement obligations

(3,325)

(3,325)

Operating income (loss)

19,826

(159)

(2,347)

17,320

Derivatives instruments loss, net

(1,026)

(1,026)

Income tax benefit

(42,141)

(20,083)

(62,224)

Additions to oil and natural gas properties and equipment – accrual

36,595

3

36,598

Nine Months Ended September 30, 2018

(in thousands)

Gabon

Equatorial Guinea

Corporate and Other

Total

Revenues-oil and natural gas sales

$

77,333

$

$

4

$

77,337

Depreciation, depletion and amortization

3,095

194

3,289

Gain on revision of asset retirement obligations

(3,325)

(3,325)

Other operating income (expense), net

332

-

332

Operating income (loss)

45,670

(274)

(9,315)

36,081

Derivatives instruments loss, net

-

(2,036)

(2,036)

Other, net

(127)

(3)

(18)

(148)

Interest expense, net

(397)

124

(273)

Income tax benefit

(34,517)

(20,083)

(54,600)

Additions to oil and natural gas properties and equipment – accrual

37,550

17

37,567

(in thousands)

Gabon

Equatorial Guinea

Corporate and Other

Total

Long-lived assets from continuing operations:

As of September 30, 2019

$

46,276

$

10,000

$

341

$

56,617

As of December 31, 2018

$

42,195

$

10,187

$

342

52,724

(in thousands)

Gabon

Equatorial Guinea

Corporate and Other

Total

Total assets from continuing operations:

As of September 30, 2019

$

148,221

$

10,085

$

50,680

$

208,986

As of December 31, 2018

$

103,401

$

10,320

$

49,301

163,022

Information about the Company’s most significant customers

The Company sells crude oil production from Gabon under term contracts with pricing based upon an average of Dated Brent in the month of lifting, adjusted for location and market factors. From August 2015 through January 2019, the Company sold its crude oil to Glencore Energy UK Ltd. (“Glencore”). The Company signed a new contract with Mercuria Energy Trading SA (“Mercuria”) that covers sales from February 2019 through January 2020 with pricing based upon an average of Dated Brent in the month of lifting, adjusted for location and market factors. Sales of oil to Glencore and Mercuria were approximately 100% of total revenues for the period during the terms of their contracts.