SEC Company Response from CONTANGO OIL & GAS CO (CIK 0001071993) — Aug 5, 2021
CONTANGO OIL & GAS CO (CIK 0001071993)
Date: Aug. 5, 2021 · CIK: 0001071993 · Accession: 0001193125-21-238045
AI Filing Summary & Sentiment
File numbers found in text: 001-16317
Referenced dates: July 27, 2021, September 24, 2015
Letter
PRIVILEGED AND CONFIDENTIAL
August 5, 2021
VIA EDGAR
U.S. Securities and Exchange Commission
Division of Corporation Finance
Office of Energy & Transportation
100 F Street, N.E.
Washington, DC 20549
Attention:
Sandra Wall
Brad Skinner
Re: Contango Oil & Gas Company
Form 10-K for the Fiscal Year Ended December 31, 2020, Filed March 10,
2021 (File No. 001-16317)
Ladies and Gentlemen:
On behalf of Contango Oil & Gas Company, a Texas corporation (the “Company”), set forth below are responses of the Company to the comments of the staff of the Division of Corporation Finance (the “Staff”) of the U.S. Securities and Exchange Commission (the “Commission”) contained in your letter dated July 27, 2021 (the “Comment Letter”) regarding the above-referenced Form 10-K for the Fiscal Year Ended December 31, 2020, File No. 001-16317 (the “2020 Annual Report”). Capitalized terms used herein and otherwise not defined herein shall have the meanings assigned to such terms in the 2020 Annual Report.
For your convenience, each response is prefaced by the exact text of the Staff’s corresponding comment in bold, italicized text. All references to page numbers and captions correspond to the 2020 Annual Report unless otherwise specified.
We respectfully note for the Staff that on June 7, 2021, the Company entered into a definitive agreement (the “Transaction Agreement”) with Independence Energy, LLC, a Delaware limited liability company (“Independence”), an entity managed by KKR & Co. Inc. (“KKR”), IE PubCo Inc., a Delaware corporation (“New PubCo”), and certain other entities affiliated with Independence, New PubCo and KKR. New PubCo was incorporated and formed for the purpose of effecting a merger between the Company and Independence through a series of transactions pursuant to the Transaction Agreement (the
U.S. Securities and Exchange Commission
Division of Corporation Finance
Office of Energy & Transportation
August 5, 2021
Page
“Transactions”). It is a condition to the consummation of the Transactions that the shares of New PubCo Class A common stock to be issued in connection with the Transactions be authorized for listing on a nationally recognized stock exchange. New PubCo intends to apply for listing on the NYSE. If and when the Transactions are completed, the Company’s common stock currently listed on the NYSE American would cease to be listed on the NYSE American and will be deregistered under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and the Company would no longer be required to file reports with the Commission pursuant to the Exchange Act. Closing is expected to occur in the fourth quarter of 2021.
Exploration and Development Acreage, page 47
1. We note your disclosure of the undeveloped acreage subject to expiration over the next three fiscal years represents approximately 86% of your total net undeveloped acreage. Please tell us the extent to which you have assigned any proved undeveloped reserves to locations which are currently scheduled to be drilled after lease expiration.
Response: We acknowledge the Staff’s comment and respectfully advise the Staff that we do not have any wells, including proved undeveloped locations, scheduled to be drilled after lease expiration.
At December 31, 2020, we had four gross locations associated with proved undeveloped reserves scheduled to be drilled in 2021. Additionally, we had two unproved wells scheduled to be drilled in 2021. Three of these wells were recently drilled on one pad and are awaiting completion. Drilling of the second pad of three wells is in process at this time. Commencing drilling operations extends the lease term for each of the leases associated with all of our proved undeveloped reserves. Completion of the wells, included in our adopted development plan, will fully hold the leases and associated acreage.
Exploration and Development Acreage, page 47
2. If there are material quantities of net proved undeveloped reserves relating to such locations, expand the disclosure here or in an appropriate section elsewhere to provide the net quantities of such reserves and explain the steps and related
U.S. Securities and Exchange Commission
Division of Corporation Finance
Office of Energy & Transportation
August 5, 2021
Page
costs, if material, which would be necessary to extend the time to the expiration of such leases. Refer to Rule 4-10(a)(26) of Regulation S-K and FASB ASC 932-235-50-10.
Response: We respectfully advise the Staff that the quantities of net proved undeveloped reserves relating to such locations are not material. We also advise that, as of December 31, 2020, we had approved drilling plans for 2021 that, when implemented, would extend the leases associated with our proved undeveloped reserves without requiring any additional steps or further costs to be incurred.
Properties
Drilling Activity, page 47
3. Expand your disclosure to address your present activities, including the number of gross and net wells in the process of being drilled, completed, or waiting on completion and any other related activities of material importance as of December 31, 2020. Refer to the disclosure requirements in Item 1206 of Regulation S-K.
Response: We respectfully advise the Staff that during the first quarter of 2020, we suspended our onshore drilling program and well completion operations for the remainder of the year due to the low and volatile commodity price environment for oil and natural gas. We suspended our offshore drilling program during the second quarter of 2020. As of December 31, 2020 and including up to the filing date of March 10, 2021, there were no wells being drilled, completed or waiting on completion or any other related activities of material importance.
Proved Undeveloped Reserves, page 52
4. Please expand the disclosure relating to the conversion of your proved undeveloped reserves to provide the dollar amounts of capital expenditures made during the year to convert proved undeveloped reserves to proved developed reserves. Refer to Item 1203(c) of Regulation S-K and your response to comment 1 in our letter dated September 24, 2015.
U.S. Securities and Exchange Commission
Division of Corporation Finance
Office of Energy & Transportation
August 5, 2021
Page
Response: We respectfully advise the Staff that during 2020, we incurred $164,000 (net) of capital expenditures converting proved undeveloped reserves to proved developed reserves. One gross location was brought on production in January 2020 and resulted in the conversion of 125 MBoe from proved undeveloped reserves to proved developed reserves. We substantially reduced our capital spend in 2020 in response to the severe economic uncertainty associated with the COVID-19 pandemic and the supply and demand imbalances in the oil and gas market. We acknowledge the Staff’s comment and intend in applicable future filings to more explicitly disclose the amount of capital expenditures made during the year to convert proved undeveloped reserves reported as of the prior year-end.
Proved Undeveloped Reserves, page 52
5. Disclosure provided in Form 10-K for the fiscal years ending December 31, 2020, 2019, 2018, 2017 and 2016 indicates you converted approximately 1.0%, 3.4%, 5.5%, 0% and 0%, respectively, of the opening balance of your proved undeveloped reserves during each of those periods. Please tell us how you have taken into consideration your low historical conversion rates in adopting a development plan that results in the conversion of the 6,680 MBoe of proved undeveloped reserves as of December 31, 2020 within five years of initial disclosure of such reserves. Refer to Rule 4-10(a)(31)(ii) of Regulation S-X and the Question 131.04 in the Compliance and Disclosure Interpretations (C&DIs).
Response: We acknowledge the Staff’s comment regarding low historic conversion rates of proved undeveloped reserves in fiscal years 2016-2020. As stated in our disclosure, our current business strategy is “… pursuing accretive, opportunistic acquisitions that meet our short-term and long-term strategic and financial objectives” (pg. 5). In addition, we disclosed our intent to “minimize our drilling program” and “… limit near-term drilling capital for the foreseeable future to that necessary to fulfill leasehold commitments, and preserve core acreage when appropriate, and where the opportunity exists, to drill on acquired acreage where we can add production and cash flow at attractive rates of return” (pg. 5).
U.S. Securities and Exchange Commission
Division of Corporation Finance
Office of Energy & Transportation
August 5, 2021
Page
In response to an ongoing low commodity price environment, we have continued to execute our strategy to minimize our drilling program. As a result of general economic and industry conditions and our strategic responses thereto, our drilling program associated with proved undeveloped locations was reduced from 58 gross locations across multiple regions (21 gross locations in West Texas; 35 gross locations in Southeast Texas; and two gross locations in South Texas and Wyoming) for the year ended December 31, 2019 to 32 gross locations at our NE Bullseye asset in West Texas (12 gross locations added and one location converted to proved developed) and two drilled, but uncompleted wells (“DUCs”) in our Mid-Continent region for the year ended December 31, 2020. Our adopted drilling program is conservative and reflects both our shift in business strategy and confidence in our financial ability to execute our adopted development program through future economic cycles.
Proved Undeveloped Reserves, page 52
6. Please provide us with your development schedule, indicating for each future annual period, the number of gross wells to be drilled, the net quantities of reserves converted, and the estimated capital expenditures incurred resulting in the conversion of all of the proved undeveloped reserves disclosed as of December 31, 2020 to developed reserves. Refer to Rule 4-10(a)(31)(ii) of Regulation S-X.
Response: As requested, please find below our current development schedule for each future annual period.
Fiscal Year
Gross Locations/DUCs
Net quantities of reserves converted (Mboe)
Estimated capital expenditures (net) ($M)
11,209
1,367
19,078
2,519
35,519
1,788
25,601
1,683
Total
6,680
93,090
U.S. Securities and Exchange Commission
Division of Corporation Finance
Office of Energy & Transportation
August 5, 2021
Page
Note: The data provided for 2021 and 2022 includes two DUCs in our Mid-Continent region that were acquired as part of the White Star acquisition in the fourth quarter of 2019.
Exhibit Number 99.2 Report of W.D. Von Gonten and Company, page 80
7. The reserve report does not include certain disclosures required by Item 1202 (a)(8) of Regulation S-K. Please obtain a revised report to address the following information in order to satisfy your filing obligations. Also refer to your response to comment 9 in our letter dated September 24, 2015.
•
The purpose for which the report was prepared (e.g. for inclusion as an exhibit in a filing made with the U.S. Securities and Exchange Commission (SEC) (Item 1202(a)(8)(i)).
•
The date on which the report was completed (Item 1202(a)(8)(ii)).
•
The proportion of the registrant’s total reserves covered by the report (Item 1202(a)(8)(iii) and the percentage of the registrant’s total reserves reviewed in connection with the preparation of the report (Item 1202(a) (8)(iv)).
•
A statement that the assumptions, data, methods, and procedures are appropriate for the purpose served by the report (Item 1202(a)(8)(iv)).
•
The average realized prices by product for the reserves included in the report as part of the discussion of primary economic assumptions (Item 1202(a)(8)(v)).
•
A statement that the third party has used all methods and procedures as it considered necessary under the circumstance to prepare the report (Item 1202(a)(8)(viii)).
Response: W.D. Von Gonten and Company has delivered a revised reserve report as of December 31, 2020 addressing the foregoing comments, a copy of which is attached as Exhibit A hereto.
U.S. Securities and Exchange Commission
Division of Corporation Finance
Office of Energy & Transportation
August 5, 2021
Page
Exhibit Number 99.2 Report of W.D. Von Gonten and Company, page 80
8. Disclosure of the “Reporting Requirements” provided on page 2 references the SPE PRMS and Rule 4-10 of Regulation S-X but appears to indicate that the estimated proved reserves shown in the report were prepared in conformance with the SPE definitions. Furthermore, the disclosure refers to regulations and standards under Item 102 of Regulation S-K and the Financial Accounting Standards Board (FASB) Statement No. 69 which have been updated pursuant to the Modernization of Oil and Gas Reporting; Final Rule. Please revise the disclosure to resolve these inconsistencies or tell us why a revision is not needed.
Response: W.D. Von Gonten and Company has delivered a revised reserve report as of December 31, 2020 addressing the foregoing comments, a copy of which is attached as Exhibit A hereto.
Exhibits and Financial Statement Schedules
Exhibits
Exhibit Number 99.1 Report of William M. Cobb & Associates, Inc., page 80
9. The reserve report does not include certain disclosures required by Item 1202(a)(8) of Regulation S-K. Please obtain a revised report to address the following information in order to satisfy your filing obligations.
•
The date on which the report was completed (Item 1202(a)(8)(ii)).
Response: William M. Cobb & Associates, Inc. has delivered a revised reserve report as of December 31, 2020 addressing the foregoing comments, a copy of which is attached as Exhibit B hereto.
Exhibit Number 99.1 Report of William M. Cobb & Associates, Inc., page 80
10. Disclosure on page 5 indicating that Cobb & Associates used the reserves definitions set forth in the SPE PRMS appears to be inconsistent with disclosure elsewhere on page 2 indicating the reserves estimates in the report were prepared in accordance with the definitions and regulations of the U.S. Securities and Exchange Commission and conform to the FASB Accounting Standards Codification Topic 932. Please revise the disclosure to resolve this inconsistency or tell us why a revision is not needed.
Response: William M. Cobb & Associates, Inc. has delivered a revised reserve report as of December 31, 2020 addressing the foregoing comments, a copy of which is attached as Exhibit B hereto.
U.S. Securities and Exchange Commission
Division of Corporation Finance
Office of Energy & Transportation
August 5, 2021
Page
Exhibit Number 99.1 Report of William M. Cobb & Associates, Inc., page 80
11. Please tell us, and if true, expand the disclosure in the revised report to clarify the extent to which the salvage value for the lease and well equipment and the costs of abandoning all of the properties have been included. Refer to Item 1202(a)(8)(iv) of Regulation S-K and your response to comment 7 in our letter dated September 24, 2015.
Response: William M. Cobb & Associates, Inc. has delivered a revised reserve report as of December 31, 2020 addressing the foregoing comments, a copy of which is attached as Exhibit B hereto.
Exhibit Number 99.1 Report of William M. Cobb & Associates, Inc., page 80
12. The reserve report refers to additional information contained in Appendix A and Appendix B that are not included as attachments to Exhibit 99.1. Please obtain and file a revised report to include the referenced attachments as supplemental information. Alternatively, remove these references if you do not intend to in
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CORRESP
1
filename1.htm
CORRESP
PRIVILEGED AND
CONFIDENTIAL
August 5, 2021
VIA
EDGAR
U.S. Securities and Exchange Commission
Division
of Corporation Finance
Office of Energy & Transportation
100 F Street, N.E.
Washington, DC 20549
Attention:
Sandra Wall
Brad Skinner
Re:
Contango Oil & Gas Company
Form 10-K for the Fiscal Year Ended December 31, 2020, Filed
March 10,
2021 (File No. 001-16317)
Ladies and Gentlemen:
On behalf of Contango
Oil & Gas Company, a Texas corporation (the “Company”), set forth below are responses of the Company to the comments of the staff of the Division of Corporation Finance (the “Staff”) of the U.S. Securities
and Exchange Commission (the “Commission”) contained in your letter dated July 27, 2021 (the “Comment Letter”) regarding the above-referenced Form 10-K for the Fiscal
Year Ended December 31, 2020, File No. 001-16317 (the “2020 Annual Report”). Capitalized terms used herein and otherwise not defined herein shall have the meanings assigned to such
terms in the 2020 Annual Report.
For your convenience, each response is prefaced by the exact text of the Staff’s corresponding
comment in bold, italicized text. All references to page numbers and captions correspond to the 2020 Annual Report unless otherwise specified.
We respectfully note for the Staff that on June 7, 2021, the Company entered into a definitive agreement (the “Transaction
Agreement”) with Independence Energy, LLC, a Delaware limited liability company (“Independence”), an entity managed by KKR & Co. Inc. (“KKR”), IE PubCo Inc., a Delaware corporation (“New PubCo”), and
certain other entities affiliated with Independence, New PubCo and KKR. New PubCo was incorporated and formed for the purpose of effecting a merger between the Company and Independence through a series of transactions pursuant to the Transaction
Agreement (the
U.S. Securities and Exchange Commission
Division of Corporation Finance
Office of Energy &
Transportation
August 5, 2021
Page
2
“Transactions”). It is a condition to the consummation of the Transactions that the shares of New PubCo Class A common stock to be issued in connection with the Transactions be
authorized for listing on a nationally recognized stock exchange. New PubCo intends to apply for listing on the NYSE. If and when the Transactions are completed, the Company’s common stock currently listed on the NYSE American would cease to be
listed on the NYSE American and will be deregistered under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and the Company would no longer be required to file reports with the Commission pursuant to the Exchange Act.
Closing is expected to occur in the fourth quarter of 2021.
Exploration and Development Acreage, page 47
1.
We note your disclosure of the undeveloped acreage subject to expiration over the next three fiscal years
represents approximately 86% of your total net undeveloped acreage. Please tell us the extent to which you have assigned any proved undeveloped reserves to locations which are currently scheduled to be drilled after lease expiration.
Response: We acknowledge the Staff’s comment and respectfully advise the Staff that we do not have any
wells, including proved undeveloped locations, scheduled to be drilled after lease expiration.
At December 31, 2020, we had four
gross locations associated with proved undeveloped reserves scheduled to be drilled in 2021. Additionally, we had two unproved wells scheduled to be drilled in 2021. Three of these wells were recently drilled on one pad and are awaiting completion.
Drilling of the second pad of three wells is in process at this time. Commencing drilling operations extends the lease term for each of the leases associated with all of our proved undeveloped reserves. Completion of the wells, included in our
adopted development plan, will fully hold the leases and associated acreage.
Exploration and Development Acreage, page 47
2.
If there are material quantities of net proved undeveloped reserves relating to such locations, expand
the disclosure here or in an appropriate section elsewhere to provide the net quantities of such reserves and explain the steps and related
U.S. Securities and Exchange Commission
Division of Corporation Finance
Office of Energy &
Transportation
August 5, 2021
Page
3
costs, if material, which would be necessary to extend the time to the expiration of such leases. Refer to Rule 4-10(a)(26) of Regulation S-K and FASB ASC 932-235-50-10.
Response: We respectfully advise the Staff that the quantities of net proved undeveloped reserves relating to such locations are not
material. We also advise that, as of December 31, 2020, we had approved drilling plans for 2021 that, when implemented, would extend the leases associated with our proved undeveloped reserves without requiring any additional steps or further
costs to be incurred.
Properties
Drilling Activity, page 47
3.
Expand your disclosure to address your present activities, including the number of gross and net wells in
the process of being drilled, completed, or waiting on completion and any other related activities of material importance as of December 31, 2020. Refer to the disclosure requirements in Item 1206 of Regulation
S-K.
Response: We respectfully advise the Staff that
during the first quarter of 2020, we suspended our onshore drilling program and well completion operations for the remainder of the year due to the low and volatile commodity price environment for oil and natural gas. We suspended our offshore
drilling program during the second quarter of 2020. As of December 31, 2020 and including up to the filing date of March 10, 2021, there were no wells being drilled, completed or waiting on completion or any other related activities of
material importance.
Proved Undeveloped Reserves, page 52
4.
Please expand the disclosure relating to the conversion of your proved undeveloped reserves to provide
the dollar amounts of capital expenditures made during the year to convert proved undeveloped reserves to proved developed reserves. Refer to Item 1203(c) of Regulation S-K and your response to comment 1 in
our letter dated September 24, 2015.
U.S. Securities and Exchange Commission
Division of Corporation Finance
Office of Energy &
Transportation
August 5, 2021
Page
4
Response: We respectfully advise the Staff that during 2020, we incurred $164,000
(net) of capital expenditures converting proved undeveloped reserves to proved developed reserves. One gross location was brought on production in January 2020 and resulted in the conversion of 125 MBoe from proved undeveloped reserves to proved
developed reserves. We substantially reduced our capital spend in 2020 in response to the severe economic uncertainty associated with the COVID-19 pandemic and the supply and demand imbalances in the oil and
gas market. We acknowledge the Staff’s comment and intend in applicable future filings to more explicitly disclose the amount of capital expenditures made during the year to convert proved undeveloped reserves reported as of the prior year-end.
Proved Undeveloped Reserves, page 52
5.
Disclosure provided in Form 10-K for the fiscal years ending
December 31, 2020, 2019, 2018, 2017 and 2016 indicates you converted approximately 1.0%, 3.4%, 5.5%, 0% and 0%, respectively, of the opening balance of your proved undeveloped reserves during each of those periods. Please tell us how you have
taken into consideration your low historical conversion rates in adopting a development plan that results in the conversion of the 6,680 MBoe of proved undeveloped reserves as of December 31, 2020 within five years of initial disclosure of such
reserves. Refer to Rule 4-10(a)(31)(ii) of Regulation S-X and the Question 131.04 in the Compliance and Disclosure Interpretations (C&DIs).
Response: We acknowledge the Staff’s comment regarding low historic conversion rates of proved
undeveloped reserves in fiscal years 2016-2020. As stated in our disclosure, our current business strategy is “… pursuing accretive, opportunistic acquisitions that meet our short-term and long-term strategic and financial objectives”
(pg. 5). In addition, we disclosed our intent to “minimize our drilling program” and “… limit near-term drilling capital for the foreseeable future to that necessary to fulfill leasehold commitments, and preserve core
acreage when appropriate, and where the opportunity exists, to drill on acquired acreage where we can add production and cash flow at attractive rates of return” (pg. 5).
U.S. Securities and Exchange Commission
Division of Corporation Finance
Office of Energy &
Transportation
August 5, 2021
Page
5
In response to an ongoing low commodity price environment, we have continued to execute our
strategy to minimize our drilling program. As a result of general economic and industry conditions and our strategic responses thereto, our drilling program associated with proved undeveloped locations was reduced from 58 gross locations across
multiple regions (21 gross locations in West Texas; 35 gross locations in Southeast Texas; and two gross locations in South Texas and Wyoming) for the year ended December 31, 2019 to 32 gross locations at our NE Bullseye asset in West Texas (12
gross locations added and one location converted to proved developed) and two drilled, but uncompleted wells (“DUCs”) in our Mid-Continent region for the year ended December 31, 2020. Our
adopted drilling program is conservative and reflects both our shift in business strategy and confidence in our financial ability to execute our adopted development program through future economic cycles.
Proved Undeveloped Reserves, page 52
6.
Please provide us with your development schedule, indicating for each future annual period, the number of
gross wells to be drilled, the net quantities of reserves converted, and the estimated capital expenditures incurred resulting in the conversion of all of the proved undeveloped reserves disclosed as of December 31, 2020 to developed reserves.
Refer to Rule 4-10(a)(31)(ii) of Regulation S-X.
Response: As requested, please find below our current development schedule for each future annual period.
Fiscal Year
Gross
Locations/DUCs
Net quantities of
reserves converted
(Mboe)
Estimated capital
expenditures (net)
($M)
2021
5
895
11,209
2022
6
1,367
19,078
2023
11
2,519
35,519
2024
11
1,788
25,601
2025
1
110
1,683
Total
34
6,680
93,090
U.S. Securities and Exchange Commission
Division of Corporation Finance
Office of Energy &
Transportation
August 5, 2021
Page
6
Note: The data provided for 2021 and 2022 includes two DUCs in our
Mid-Continent region that were acquired as part of the White Star acquisition in the fourth quarter of 2019.
Exhibit Number 99.2 Report of W.D. Von Gonten and Company, page 80
7.
The reserve report does not include certain disclosures required by Item 1202 (a)(8) of Regulation S-K. Please obtain a revised report to address the following information in order to satisfy your filing obligations. Also refer to your response to comment 9 in our letter dated September 24, 2015.
•
The purpose for which the report was prepared (e.g. for inclusion as an exhibit in a filing made with the
U.S. Securities and Exchange Commission (SEC) (Item 1202(a)(8)(i)).
•
The date on which the report was completed (Item 1202(a)(8)(ii)).
•
The proportion of the registrant’s total reserves covered by the report (Item 1202(a)(8)(iii) and the
percentage of the registrant’s total reserves reviewed in connection with the preparation of the report (Item 1202(a) (8)(iv)).
•
A statement that the assumptions, data, methods, and procedures are appropriate for the purpose served by
the report (Item 1202(a)(8)(iv)).
•
The average realized prices by product for the reserves included in the report as part of the discussion of
primary economic assumptions (Item 1202(a)(8)(v)).
•
A statement that the third party has used all methods and procedures as it considered necessary under the
circumstance to prepare the report (Item 1202(a)(8)(viii)).
Response: W.D. Von Gonten and Company
has delivered a revised reserve report as of December 31, 2020 addressing the foregoing comments, a copy of which is attached as Exhibit A hereto.
U.S. Securities and Exchange Commission
Division of Corporation Finance
Office of Energy &
Transportation
August 5, 2021
Page
7
Exhibit Number 99.2 Report of W.D. Von Gonten and Company, page 80
8.
Disclosure of the “Reporting Requirements” provided on page 2 references the SPE PRMS and Rule 4-10 of Regulation S-X but appears to indicate that the estimated proved reserves shown in the report were prepared in conformance with the SPE definitions. Furthermore, the
disclosure refers to regulations and standards under Item 102 of Regulation S-K and the Financial Accounting Standards Board (FASB) Statement No. 69 which have been updated pursuant to the Modernization
of Oil and Gas Reporting; Final Rule. Please revise the disclosure to resolve these inconsistencies or tell us why a revision is not needed.
Response: W.D. Von Gonten and Company has delivered a revised reserve report as of December 31, 2020 addressing the foregoing
comments, a copy of which is attached as Exhibit A hereto.
Exhibits and Financial Statement Schedules
Exhibits
Exhibit Number 99.1 Report of
William M. Cobb & Associates, Inc., page 80
9.
The reserve report does not include certain disclosures required by Item 1202(a)(8) of Regulation S-K. Please obtain a revised report to address the following information in order to satisfy your filing obligations.
•
The date on which the report was completed (Item 1202(a)(8)(ii)).
Response: William M. Cobb & Associates, Inc. has delivered a revised reserve report as of December 31, 2020 addressing the
foregoing comments, a copy of which is attached as Exhibit B hereto.
Exhibit Number 99.1 Report of William M. Cobb & Associates, Inc.,
page 80
10.
Disclosure on page 5 indicating that Cobb & Associates used the reserves definitions set forth in
the SPE PRMS appears to be inconsistent with disclosure elsewhere on page 2 indicating the reserves estimates in the report were prepared in accordance with the definitions and regulations of the U.S. Securities and Exchange Commission and conform
to the FASB Accounting Standards Codification Topic 932. Please revise the disclosure to resolve this inconsistency or tell us why a revision is not needed.
Response: William M. Cobb & Associates, Inc. has delivered a revised reserve report as of December 31, 2020 addressing the
foregoing comments, a copy of which is attached as Exhibit B hereto.
U.S. Securities and Exchange Commission
Division of Corporation Finance
Office of Energy &
Transportation
August 5, 2021
Page
8
Exhibit Number 99.1 Report of William M. Cobb & Associates, Inc., page 80
11.
Please tell us, and if true, expand the disclosure in the revised report to clarify the extent to which
the salvage value for the lease and well equipment and the costs of abandoning all of the properties have been included. Refer to Item 1202(a)(8)(iv) of Regulation S-K and your response to comment 7 in our
letter dated September 24, 2015.
Response: William M. Cobb & Associates, Inc. has
delivered a revised reserve report as of December 31, 2020 addressing the foregoing comments, a copy of which is attached as Exhibit B hereto.
Exhibit Number 99.1 Report of William M. Cobb & Associates, Inc., page 80
12.
The reserve report refers to additional information contained in Appendix A and Appendix B that are not
included as attachments to Exhibit 99.1. Please obtain and file a revised report to include the referenced attachments as supplemental information. Alternatively, remove these references if you do not intend to in