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November 18, 2022

Division of Corporation Finance

Office of Energy & Transportation

United States Securities and Exchange Commission

Division of Corporation Finance

100 F Street, N.E.

Washington, D.C. 20549-3561

Re: Berry Corporation (bry)

Form 10-K for Fiscal Year Ended December 31, 2021

Form 8-K filed November 2, 2022

File No. 001-38606

Ladies and Gentlemen:

Set forth below are the responses of Berry Corporation (bry) (the “Company,” “we” or “our”) to comments received from the staff of the Division of Corporation Finance (the “Staff”) of the Securities and Exchange Commission (the “Commission”) by letter dated November 4, 2022, with respect to Form 10-K for Fiscal Year Ended December 31, 2021, File No. 001-38606, filed with the Commission on March 4, 2022 (the “Annual Report”) and Form 8-K, File No. 001-38606, filed with the Commission on November 2, 2022 (the “Current Report”).

For your convenience, each response is prefaced by the exact text of the Staff’s corresponding comment in bold, italicized text.

Form 10-K for Fiscal Year Ended December 31, 2021

Management's Discussion and Analysis of Financial Condition and Results of Operations

How We Plan and Evaluate Operations

Operating Expenses, page 70

1.    We note your use of the measure Operating Expenses and the definition provided on page 70 along with the measure Unhedged Operating Expenses. In addition, we note disclosure in note 1 on page 79 that “We report electricity, transportation and marketing sales separately in our financial statements as revenues in accordance with GAAP. However, these revenues are viewed and used internally in calculating operating expenses which is used to track and analyze the economics of development projects and the efficiency of our hydrocarbon recovery.” Tell us how you considered whether Operating Expenses and Unhedged Operating Expenses are non-GAAP measures.

If these are non-GAAP measures, provide disclosure consistent with Item 10(e) of Regulation S-K. In addition, revise the names of these measures to comply with Item

10(e)(1)(ii)(E) of Regulation S-K and tell us whether they represent non-GAAP measures that substitute individually tailored recognition and measurement methods for those of GAAP per Question 100.04 of the Non-GAAP Compliance and Disclosure Interpretations.

RESPONSE:

The Company respectfully advises the Staff that it does not consider Operating Expenses to be a non-GAAP measure. Instead, our disclosure regarding Operating Expenses was intended to be a narrative summary of the key components of our oil and gas production operations economics, rather than a measure of performance or liquidity. In particular, these measures do not have a directly comparable GAAP equivalent from which they are adjusted. Instead, they are a combination of certain expense and revenue line items from our statement of operations that relate directly to the Company’s Development and Production (“D&P”) segment field operations, as well as the portion of the “cash settlements on derivatives” line related to our gas purchases from our statement of cash flows, which will be set forth in a note to our financial statements in future filings. Since the Company reports both expenses and revenues in electricity generation, transportation and marketing, this calculation allows the Company to consider these components on a net basis in assessing the economics of field operations in relation to production. Management uses the net total of these field non-oil and gas revenues, together with field expenses and cash settlements on derivatives for our gas purchases, as an overall cost efficiency subtotal to measure our controllable net costs separate from our oil and gas revenues that are solely market-based. We believe that this data is also useful for investors in understanding our controllable net costs. Management also uses Operating Expenses as a factor in setting performance metrics for our field employees.

The Company acknowledges the Staff’s reference to Question 100.04 of the Non-GAAP Compliance and Disclosure Interpretations and respectfully advises the Staff that Operating Expenses does not substitute individually tailored recognition and measurement methods for those of GAAP; each component of Operating Expenses is calculated in accordance with GAAP and has not been individually tailored to accelerate or adjust revenue recognition or measurement methods. Since we do not view Operating Expenses as a non-GAAP measure, we respectfully advise the Staff that we do not believe disclosure consistent with Item 10(e) is required. With respect to the term Unhedged Operating Expenses, the Company respectfully advises the Staff that it does not intend to use the term or measure Unhedged Operating Expenses in future filings and earnings releases.

The Company also advises the Staff that we will change the name “Operating Expenses” to “Field Operating Results, net” in future filings and earnings releases to more clearly reflect the components of this measure. In addition, to help investors better understand the components of this measure, we plan to include a table in substantially the form set forth below that includes the components of Field Operating Results, net:

 Three Months Ended  Year-Ended

 September 30, 2022  June 30,
2022  September 30, 2021  December 31, 2021  December 31, 2020

 ($ in thousands except per boe amounts)

Field operating results - expenses

Lease operating expenses $ 79,141    $ 72,455    $ 60,930    $ 236,048    $ 186,348

Electricity generation expenses 6,055    6,122    7,128    23,148    16,608

Transportation expenses 1,277    1,108    1,806    6,897    6,938

Marketing expenses —    —    715    3,811    1,380

Total field operating results - expenses 86,473    79,685    70,579    269,904    211,274

Field operating results - revenues

Electricity sales (9,711)   (7,419)   (12,371)   (35,636)   (25,813)

Transportation sales (277)   (120)   (117)   (477)   (150)

Marketing revenues —    —    (732)   (3,921)   (1,426)

Total field operating results - revenues (9,988)   (7,539)   (13,220)   (40,034)   (27,389)

Cash settlements for gas hedge purchases (13,785)   (10,188)   (14,095)   (50,897)   9,298

Total field operating results, net $ 62,700    $ 61,958    $ 43,264    $ 178,973    $ 193,183

Total production mboe 2,369    2,386    2,519    10,004    10,435

Total field operating results, net $/boe $ 26.46    $ 25.97    $ 17.18    $ 17.89    $ 18.51

2.    With your response to the preceding comment, please explain whether unhedged lease operating expenses, unhedged fuel purchase price, and unhedged fuel cost as disclosed in your September 30, 2022 Form 10-Q are non-GAAP measures for which the disclosures per Item 10(e) of Regulation S-K should be provided.

RESPONSE:

The Company respectfully advises the Staff that it does not consider the terms unhedged lease operating expenses, unhedged fuel purchase price and unhedged fuel cost to be non-GAAP measures. The use of the word “unhedged” with each of these terms was intended to emphasize that these GAAP costs do not include the effect of any hedging activities. We will not include the word “unhedged” with these terms in future filings and earnings releases.

Certain Operating and Financial Information

Summary by Area, page 76

3.    We note your presentation by area of Operating Income (Loss) and the disclosure in note 1 explaining how the amounts are derived. Please tell us whether this is a non-GAAP measure for which disclosure pursuant to Item 10(e) of Regulation S-K should be provided.

RESPONSE:

The Company acknowledges that Operating Income (Loss), as presented in our presentation by area, is a non-GAAP measure. We believe this presentation provided useful insights about our oil and gas operations by geography when we previously operated in three states, one of which solely produced natural gas. However, we believe that this measure is less useful since we divested our Colorado operations in January 2022 and now operate in two states and produce predominantly oil. We plan to remove the Summary by Area table, including Operating Income (Loss), in future filings and earnings releases. We intend to continue to present production by state information as there are different pricing and regulatory tax regimes in place for each state.

Non-GAAP Financial Measures, page 91

4.    It appears that your disclosure as to why the measures Adjusted Net Income (Loss) and Adjusted General and Administrative Expenses are useful to investors is general in nature. Please revise your disclosure to explain in greater detail the reasons why these non-GAAP measures are useful to investors. Refer to Item 10(e)(1)(i)(C) of Regulation S-K.

RESPONSE:

The Company acknowledges the Staff’s comment and will explain in greater detail the reasons why Adjusted Net Income (Loss) and Adjusted General and Administrative Expenses are useful non-GAAP measures to investors in future filings and earnings releases. The proposed additional disclosure would read as follows, with the new disclosures in bold and underlined:

“Adjusted Net Income (Loss) is a supplemental non-GAAP financial measure used by management and external users of our financial statements, such as industry analysts, investors, lenders and rating agencies. We define Adjusted Net Income (Loss) as net income (loss) adjusted for derivative gains or losses net of cash received or paid for scheduled derivative settlements, unusual and infrequent items, and the income tax expense or benefit of these adjustments using our effective tax rate. Adjusted Net Income (Loss) excludes the impact of unusual and infrequent items affecting earnings that vary widely and unpredictably, including non-cash items such as derivative gains and losses. This measure is used by management when comparing results period over period. We believe Adjusted Net Income (Loss) is useful to investors because it reflects how management evaluates the Company’s ongoing financial and operating performance from period-to-period after removing certain transactions and activities that affect comparability of the metrics and are not reflective of the Company’s core operations. We believe this also makes it easier for investors to compare our period-to-period results with our peers.”

“Adjusted General and Administrative Expenses is a supplemental non-GAAP financial measure that is used by management and external users of our financial statements, such

as industry analysts, investors, lenders and rating agencies. We define Adjusted General and Administrative Expenses as general and administrative expenses adjusted for non-cash stock compensation expense and unusual and infrequent costs. Management believes Adjusted General and Administrative Expenses is useful because it allows us to more effectively compare our performance from period to period. We believe Adjusted General and Administrative Expenses is useful to investors because it reflects how management evaluates the Company’s ongoing general and administrative expenses from period-to-period after removing non-cash stock compensation, as well as unusual or infrequent costs that affect comparability of the metrics and are not reflective of the Company’s administrative costs. We believe this also makes it easier for investors to compare our period-to-period results with our peers.”

5.    We note that you have identified certain adjustments to the non-GAAP measures presented in your filing as “Non-recurring.” Please revise your presentation to comply with Item 10(e)(1)(ii)(B) of Regulation S-K and Question 102.03 of the Compliance & Disclosure Interpretations regarding Non-GAAP Financial Measures.

RESPONSE:

The Company acknowledges the Staff’s comment and notes that non-recurring adjustments included in the non-GAAP measures for 2021, solely in the fourth quarter, and 2022, solely in the first quarter, consisted entirely of transaction-related costs associated with our significant acquisition of C&J Well Services, LLC, a new business line and an out of the ordinary acquisition for our company. In 2020, the non-recurring adjustments consisted of COVID-19 pandemic-related costs and a corporate reorganization. In the future, to the extent we have any non-recurring adjustments to non-GAAP measures we will provide detailed disclosures regarding the nature of the adjustments.

6.    Revise your reconciliation from Net Cash Provided by Operating Activities to Adjusted EBITDA to clarify the nature of the adjustment titled “Other changes in operating assets and liabilities.”

RESPONSE:

The Company acknowledges the Staff’s comment and notes that the adjustment for “Other changes in operating assets and liabilities” is primarily related to changes in working capital. For greater clarity, we will revise the reconciliation from Net Cash Provided by Operating Activities to Adjusted EBITDA in future filings and earnings releases, as applicable, to present “Changes in operating assets and liabilities – working capital” as a separate adjustment and to further clarify the nature of the adjustment titled “Other changes in operating assets and liabilities” to the extent such remaining adjustments are material. The reconciliation will be substantially the same as the following, with updates for appropriate periods:

 Three Months Ended  Year-Ended

 September 30, 2022  June 30,
2022  September 30, 2021  December 31, 2021  December 31, 2020

 (in thousands)

Adjusted EBITDA reconciliation to net cash provided by operating activities:

Net cash provided by operating activities $ 95,762    $ 111,242    $ 22,399    $ 122,488    $ 196,529

Add (Subtract):

Cash interest payments 14,493    449    14,189    29,211    29,962

Cash income tax payments 321    2,484    294    699    222

Non-recurring costs(1)

 —    —    705    2,735    6,026

Changes in operating assets and liabilities - working capital (14,151)   (4,058)   21,597    53,425    10,993

Other operating expenses (income), net (noncash portion) 556    (370)   140    3,588    698

Adjusted EBITDA $ 96,981    $ 109,747    $ 59,324    $ 212,146    $ 244,430

__________

(1)    Non-recurring costs include legal and professional service expenses related to acquisition and divestiture activity for the fourth quarter of 2021 and the first quarter of 2022 and COVID-19 pandemic-related costs and a corporate reorganization for 2020.

7.    We note that you use Levered Free Cash Flow "to plan capital allocation to sustain production levels and for internal growth opportunities, as well as hedging needs" and to assess "[y]our financial performance and [y]our ability to generate excess cash from operations to service debt, pay fixed dividends and accelerate [y]our asset retirement activity." Please revise your description of this measure as it appears to imply that Levered Free Cash Flow represents the residual cash flow available for discretionary expenditures. Refer to Question 102.07 of the Compliance & Disclosure Interpretations on Non-GAAP Financial Measures.

RESPONSE:

The Company acknowledges the Staff’s comment and notes that, in connection with the implementation of our shareholder return model in the first quarter of 2022, the Company discontinued the use of “Levered Free Cash Flow” as presented in our Annual Report on Form 10-K for the year ended December 31, 2021, and transitioned to Discretionary Free Cash Flow, which we presented in our Quarterly Reports on Form 10-Q throughout 2022. Our presentation of Discretionary Free Cash Flow, including with respect to Question 102.07 of the Compliance & Disclosure Interpretations on Non-GAAP Financial Measures, is discussed in our response to the Comment 13 below.

8.    We note  your reconciliation from Net Income (Loss) to Adjusted Net Income and your adjustment for “Income tax expense of adjustments at effective tax rate.” Please clarify how the tax impact was