17 unchanged sentences
Based on this evaluation, management of Antero Resources Corporation concluded that our internal control over financial reporting was effective as of December 31, 2021.
−Removed: The effectiveness of our internal control over financial reporting as of December 31, 2020 has been audited by KPMG LLP, an independent registered public accounting firm which also audited our consolidated financial statements as of and for the year ended December 31, 2020, as stated in their report which appears beginning on page F-2 in this Annual Report on Form 10-K.
+Added: The effectiveness of our internal control over financial reporting as of December 31, 2021 has been audited by KPMG LLP, an independent registered public accounting firm, as stated in their report which appears beginning on page F-2 in this Annual Report on Form 10-K.
OTHER INFORMATION
10 unchanged sentences
PRINCIPAL ACCOUNTANT FEES AND SERVICES
+Added: Our independent registered accounting firm is KPMG LLP , Denver , CO, Auditor Firm ID:
Pursuant to General Instruction G(3) to Form 10-K, we incorporate by reference into this Item the information to be disclosed in our definitive proxy statement for our 2022 Annual Meeting of Stockholders.
8 unchanged sentences
001-36120) filed on October 17, 2013) .
−Removed: Description of Exhibit
Amended and Restated Bylaws of Antero Resources Corporation (incorporated by reference to Exhibit 3.2 to the Company's Current Report on Form 8-K (Commission File No.
001-36120) filed on October 17, 2013).
−Removed: Indenture related to the 5.125% Senior Notes due 2022, dated as of May 6, 2014, by and among Antero Resources Corporation, the several guarantors named therein and Wells Fargo Bank, National Association, as trustee (incorporated by reference to Exhibit 4.1 to the Company's Current Report on Form 8-K (Commission File No.
−Removed: 001-36120) filed on May 8, 2014).
−Removed: Form of 5.125% Senior Note due 2022 (incorporated by reference to Exhibit 4.2 to the Company's Current Report on Form 8-K (Commission File No.
−Removed: 001-36120) filed on May 8, 2014).
−Removed: First Supplemental Indenture related to the 5.125% Senior Notes due 2022, dated as of November 24, 2014, by and among Antero Resources Corporation, the several guarantors named therein and Wells Fargo Bank, National Association, as trustee (incorporated by reference to Exhibit 4.3 to the Company's Registration Statement on Form S-4 (Commission File No.
−Removed: 333-200605) filed on November 26, 2014).
−Removed: Second Supplemental Indenture related to the 5.125% Senior Notes due 2022, dated as of January 21, 2015, by and among Antero Resources Corporation, the several guarantors named therein and Wells Fargo Bank, National Association, as trustee (incorporated by reference to Exhibit 4.6 to the Company's Registration Statement on Form S-4 (Commission File No.
−Removed: 333-200605) filed on January 22, 2015).
−Removed: Third Supplemental Indenture related to the 5.125% Senior Notes due 2022, dated March 12, 2019, by and among Antero Resources Corporation, the several guarantors named therein and Wells Fargo Bank, National Association, as trustee (incorporated by reference to Exhibit 4.2 to the Company’s Quarterly Report on Form 10-Q (Commission File No.
−Removed: 001-36120) filed on May 1, 2019).
−Removed: Fourth Supplemental Indenture related to the 5.125% Senior Notes due 2022, dated June 3, 2020, by and among Antero Resources Corporation, the several guarantors named therein and Wells Fargo Bank, National Association, as trustee (incorporated by reference to Exhibit 4.2 to the Company’s Quarterly Report on Form 10-Q (Commission File No.
−Removed: 001-36120) filed on July 29, 2020).
−Removed: Indenture related to the 5.625% Senior Notes due 2023, dated as of March 17, 2015, by and among Antero Resources Corporation, the several guarantors named therein and Wells Fargo Bank, National Association, as trustee (incorporated by reference to Exhibit 4.1 to the Company's Current Report on Form 8-K (Commission File No.
−Removed: 001-36120) filed on March 18, 2015).
−Removed: Form of 5.625% Senior Note due 2023 (incorporated by reference to Exhibit 4.2 to the Company's Current Report on Form 8-K (Commission File No.
−Removed: 333-164876) filed on March 18, 2015).
−Removed: First Supplemental Indenture related to the 5.625% Senior Notes due 2023, dated March 12, 2019, by and among Antero Resources Corporation, the several guarantors named therein and Wells Fargo Bank, National Association, as trustee (incorporated by reference to Exhibit 4.3 to the Company’s Quarterly Report on Form 10-Q (Commission File No.
−Removed: 001-36120) filed on May 1, 2019).
−Removed: Second Supplemental Indenture related to the 5.625% Senior Notes due 2023, dated June 3, 2020, by and among Antero Resources Corporation, the several guarantors named therein and Wells Fargo Bank, National Association, as trustee (incorporated by reference to Exhibit 4.3 to the Company’s Quarterly Report on Form 10-Q (Commission File No.
−Removed: 001-36120) filed on July 29, 2020).
Indenture related to the 5.0% Senior Notes due 2025, dated as of December 21, 2016, by and among Antero Resources Corporation, the several guarantors named therein and Wells Fargo Bank, National Association, as trustee (incorporated by reference to Exhibit 4.1 to the Company's Current Report on Form 8-K (Commission File No.
24 unchanged sentences
001-36120) filed on February 1, 2021).
+Added: Indenture related to the 5.375% Senior Notes due 2030, dated as of June 1, 2021, by and among Antero Resources Corporation, the several guarantors named therein and Wells Fargo Bank, National Association, as trustee (incorporated by reference to Exhibit 4.1 to the Company’s Current Report on Form 8-K (Commission File No.
+Added: 001-36120) filed on June 1, 2021).
+Added: Form of 5.375% Senior Note due 2030 (incorporated by reference to Exhibit 4.1 to the Company’s Current Report on Form 8-K (Commission File No.
+Added: 001-36120) filed on June 1, 2021).
Contribution Agreement, dated as of October 16, 2013, by and between Antero Resources Corporation and Antero Resources Midstream LLC (incorporated by reference to Exhibit 10.2 to the Company's Current Report on Form 8-K (Commission File No.
13 unchanged sentences
Second Amended and Restated Services Agreement, effective as of March 13, 2019, by and among Antero Midstream Partners LP, Antero Midstream Corporation, Antero Midstream Partners GP LLC and Antero Resources Corporation (incorporated by reference to Exhibit 10.8 to the Company’s Annual Report on Form 10-K (Commission File No.
+Added: Description of Exhibit
36120) filed on February 12, 2020).
1 unchanged sentence
001-36120) filed on February 13, 2019).
−Removed: Fifth Amended and Restated Credit Agreement, dated as of October 26, 2017, by and among Antero Resources Corporation, the lenders party thereto, and JPMorgan Chase Bank N.A., as Administrative Agent (incorporated by
−Removed: Description of Exhibit
−Removed: reference to Exhibit 10.1 to the Company's Quarterly Report on Form 10-Q (Commission File No.
−Removed: 001-36120) filed on November 1, 2017).
−Removed: First Amendment to Fifth Amended and Restated Credit Agreement, dated as of December 21, 2018 (incorporated by reference to Exhibit 10.1 to the Company's Current Report on Form 8-K (Commission File No.
−Removed: 001-36120) filed on December 28, 2018).
Lender Certificate, dated October 29, 2019, delivered by Royal Bank of Canada, and agreed to and accepted by JPMorgan Chase Bank, N.A., as Administrative Agent, and Antero Resources Corporation (incorporated by reference to Exhibit 10.12 to the Company’s Annual Report on Form 10-K (Commission File No.
001-36120) filed on February 12, 2020).
−Removed: Second Amendment to Fifth Amended and Restated Credit Agreement, dated as of December 20, 2019, among Antero Resources Corporation, as Borrower, certain subsidiaries of the Borrower, as Guarantors, the Lenders party thereto and JPMorgan Chase Bank, N.A., as Administrative Agent (incorporated by reference to Exhibit 10.13 to the Company’s Annual Report on Form 10-K (Commission File No.
−Removed: 001-36120) filed on February 12, 2020).
−Removed: Third Amendment to Fifth Amended and Restated Credit Agreement, dated as of April 29, 2020, among Antero Resources Corporation, as Borrower, certain subsidiaries of the Borrower, as Guarantors, the Lenders party thereto and JPMorgan Chase Bank, N.A., as Administrative Agent (incorporated by reference to Exhibit 10.3 to the Company’s Quarterly Report on Form 10-Q (Commission File No.
−Removed: 001-36120) filed on April 29, 2020).
−Removed: Fourth Amendment to Fifth Amended and Restated Credit Agreement, dated as of June 5, 2020, among Antero Resources Corporation, as Borrower, certain subsidiaries of the Borrower, as Guarantors, the Lenders party thereto and JPMorgan Chase Bank, N.A., as Administrative Agent (incorporated by reference to Exhibit 10.1 to the Company’s Quarterly Report on Form 10-Q (Commission File No.
−Removed: 001-36120) filed on July 29, 2020).
−Removed: Fifth Amendment to Fifth Amended and Restated Credit Agreement, dated as of June 12, 2020, among Antero Resources Corporation, as Borrower, certain subsidiaries of the Borrower, as Guarantors, the Lenders party thereto and JPMorgan Chase Bank, N.A., as Administrative Agent (incorporated by reference to Exhibit 10.2 to the Company’s Quarterly Report on Form 10-Q (Commission File No.
−Removed: 001-36120) filed on July 29, 2020).
+Added: Sixth Amended and Restated Credit Facility, dated as of October 26, 2021, by and among Antero Resources Corporation, as Borrower, the lenders party thereto and JPMorgan Chase Bank, N.A., as Administrative Agent (incorporated by reference to Exhibit 10.1 to the Company’s Quarterly Report on Form 10-Q (Commission File No.
+Added: 001-36120) filed on October 27, 2021).
Form of Amended and Restated Indemnification Agreement (incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K (Commission File No.
4 unchanged sentences
001-36120) filed on February 25, 2015).
−Removed: Form of Bonus Stock Grant Notice and Bonus Stock Agreement (Form for Non-Employee Directors) under the Antero Resources Corporation Long-Term Incentive Plan (incorporated by reference to Exhibit 10.36 to the Company's Annual Report on Form 10-K (Commission File No.
−Removed: 001-36120) filed on February 24, 2016).
Form of Performance Share Unit Grant Notice and Performance Share Unit Agreement (Form for Special Retention Awards) under the Antero Resources Corporation Long-Term Incentive Plan (incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K (Commission File No.
11 unchanged sentences
001-36120) filed on October 10, 2018).
−Removed: Description of Exhibit
Registration Rights Agreement, dated March 12, 2019, by and among Antero Midstream Corporation, the Company, Arkrose Subsidiary Holdings LLC, Glen C.
10 unchanged sentences
001-36120) filed on October 28, 2020).
−Removed: Form of Restricted Stock Unit Grant Notice and Restricted Stock Unit Agreement under the Antero Resources Corporation 2020 Long-Term Incentive Plan (incorporated by reference to Exhibit 10.2 to the Company’s Quarterly Report on Form 10-Q (Commission File No.
+Added: Form of Restricted Stock Unit Grant Notice and Restricted Stock Unit Agreement under the Antero Resources
+Added: Description of Exhibit
+Added: Corporation 2020 Long-Term Incentive Plan (incorporated by reference to Exhibit 10.2 to the Company’s Quarterly Report on Form 10-Q (Commission File No.
001-36120) filed on October 28, 2020).
1 unchanged sentence
001-36120) filed on October 28, 2020).
+Added: Form of Performance Share Unit Grant Notice and Performance Share Unit Agreement under the Antero Resources Corporation 2020 Long-Term Incentive Plan (incorporated by reference to Exhibit 10.1 to the Company’s Quarterly Report on Form 10-Q (Commission File No.
+Added: 001-36120) filed on July 28, 2021).
Subsidiaries of Antero Resources Corporation.
11 unchanged sentences
Section 1350).
+Added: Federal Mine Safety and Health Act Information.
Report of DeGolyer and MacNaughton, dated as of January 21, 2022, for proved reserves as of December 31, 2021.
5 unchanged sentences
The following financial information from this Form 10-K of Antero Resources Corporation for the year ended December 31, 2021, formatted in iXBRL (Inline eXtensible Business Reporting Language):
−Removed: (i) Consolidated Balance Sheets, (ii) Consolidated Statements of Operations and Comprehensive Income (Loss), (iii) Consolidated Statements of Equity, (iv) Consolidated Statements of Cash Flows, and (v) Notes to the Consolidated Financial Statements, tagged as blocks of text.
+Added: (i) Consolidated Balance Sheets, (ii) Consolidated Statements of Operations and Comprehensive Loss, (iii) Consolidated Statements of Equity, (iv) Consolidated Statements of Cash Flows, and (v) Notes to the Consolidated Financial Statements, tagged as blocks of text.
Cover Page Interactive Data File (embedded within the Inline XBRL document).
4 unchanged sentences
ANTERO RESOURCES CORPORATION
−Removed: President, Chief Financial Officer and Secretary
+Added: /s/ MICHAEL N.
+Added: Chief Financial Officer and Senior Vice President–Finance
February 16, 2022
1 unchanged sentence
Chairman of the Board,
−Removed: Director and Chief Executive officer
+Added: Director, Chief Executive Officer and President
February 16, 2022
(principal executive officer)
−Removed: President, Director,
−Removed: Chief Financial Officer and Secretary
+Added: /s/ MICHAEL N.
+Added: Chief Financial Officer and Senior Vice President–Finance
February 16, 2022
10 unchanged sentences
Howard Keenan, Jr.
−Removed: February 17, 2021
/s/ JACQUELINE C.
1 unchanged sentence
Jacqueline C.
+Added: /s/ BRENDA R.
+Added: February 16, 2022
/s/ VICKY SUTIL
19 unchanged sentences
Also in our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of December 31, 2021 based on criteria established in Internal Control –Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission.
−Removed: Change in Accounting Principle
−Removed: As discussed in Note 13 to the consolidated financial statements, the Company has changed its method of accounting for leases as of January 1, 2019 due to the adoption of Accounting Standards Codification Topic 842, Leases .
Basis for Opinions
14 unchanged sentences
A company’s internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company;
−Removed: (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in
−Removed: accordance with authorizations of management and directors of the company;
−Removed: and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements.
+Added: (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company;
+Added: and (3) provide reasonable assurance regarding
+Added: prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements.
Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements.
14 unchanged sentences
The following are the primary procedures we performed to address this critical audit matter.
−Removed: We evaluated the design and tested the operating effectiveness of certain internal controls over the Company’s depletion expense process, including certain controls related to the estimation of proved oil and gas reserves used in the depletion expense calculation.
+Added: We evaluated the design and tested the operating effectiveness of certain internal controls related to the Company’s depletion expense process, including certain controls related to the estimation of proved oil and gas reserves used in the depletion expense calculation.
We evaluated (1) the professional qualifications of the Company’s internal reservoir engineers as well as the external reservoir engineering specialists and external engineering firm, (2) the knowledge, skill, and ability of the Company’s internal and external reservoir engineers, and (3) the relationship of the external reservoir engineering specialists and external engineering firm to the Company.
13 unchanged sentences
Accounts receivable
−Removed: Accounts receivable, related parties
Accrued revenue
28 unchanged sentences
Long-term debt
−Removed: Deferred income tax liability
+Added: Deferred income tax liability, net
Derivative instruments
9 unchanged sentences
authorized - 1,000,000 shares;
−Removed: 295,941 shares and 268,672 shares issued and outstanding at December 31, 2019 and 2020, respectively
+Added: 268,672 shares and 313,930 shares issued and outstanding as of December 31, 2020 and 2021 , respectively
Additional paid-in capital
−Removed: Accumulated earnings (deficit)
+Added: Accumulated deficit
Total stockholders' equity
10 unchanged sentences
Commodity derivative fair value gains (losses)
−Removed: Gathering, compression, water handling and treatment
−Removed: Marketing derivative fair value gains
+Added: ( 1,936,509 )
Amortization of deferred revenue, VPP
+Added: Gathering, compression, water handling and treatment
Total revenue
3 unchanged sentences
Production and ad valorem taxes
+Added: General and administrative (including equity-based compensation expense of $ 23,559 , $ 23,317 and $ 20,437 in 2019, 2020 and 2021, respectively)
+Added: Depletion, depreciation, and amortization
Impairment of oil and gas properties
Impairment of midstream assets
−Removed: Depletion, depreciation, and amortization
Accretion of asset retirement obligations
−Removed: General and administrative (including equity-based compensation expense of $ 70,414 , $ 23,559 and $ 23,317 in 2018, 2019 and 2020, respectively)
Contract termination and rig stacking
−Removed: Loss on sale of assets
+Added: (Gain) loss on sale of assets
Total operating expenses
2 unchanged sentences
Interest expense, net
−Removed: Equity in earnings (loss) of unconsolidated affiliates
−Removed: Gain on early extinguishment of debt
+Added: Equity in earnings (loss) of unconsolidated affiliate
+Added: Gain (loss) on early extinguishment of debt
+Added: Loss on convertible note equitizations
+Added: Loss on the sale of equity method investment shares
Gain on deconsolidation of Antero Midstream Partners LP
Water earnout
−Removed: Loss on the sale of equity method investment shares
Impairment of equity method investment
Transaction expense
−Removed: Total other income (expenses)
+Added: Total other income (expense)
Loss before income taxes
( 1,657,893 )
−Removed: Provision for income tax benefit
+Added: Income tax benefit
Net loss and comprehensive loss including noncontrolling interests
14 unchanged sentences
Issuance of common units by Antero Midstream Partners LP upon vesting of equity-based compensation awards, net of units withheld for income taxes
−Removed: Effects of changes in ownership interests in consolidated subsidiaries
−Removed: Distributions to noncontrolling interests
−Removed: Repurchases and retirements of common stock
−Removed: Equity-based compensation
−Removed: Net income (loss) and comprehensive income (loss)
−Removed: Balances, December 31, 2018
−Removed: Issuance of common stock upon vesting of equity-based compensation awards, net of shares withheld for income taxes
−Removed: Issuance of common units by Antero Midstream Partners LP upon vesting of equity-based compensation awards, net of units withheld for income taxes
Effect of deconsolidation of Antero Midstream Partners LP
15 unchanged sentences
Balances, December 31, 2020
+Added: Issuance of common shares
+Added: Issuance of common units in Martica Holdings, LLC
+Added: Equity component of 2026 Convertible Notes, net
+Added: Issuance of common stock upon vesting of equity-based compensation awards, net of shares withheld for income taxes
+Added: Distributions to noncontrolling interest
+Added: Equity-based compensation
+Added: Net income (loss) and comprehensive income (loss)
+Added: Balances, December 31, 2021
See accompanying notes to consolidated financial statements.
9 unchanged sentences
Commodity derivative fair value losses (gains)
−Removed: Gains on settled commodity derivatives
−Removed: Premium paid on derivative contract
−Removed: Proceeds from derivative monetizations
−Removed: Gains on settled marketing derivatives
−Removed: Marketing derivative fair value gains
−Removed: Loss on sale of assets
−Removed: Equity-based compensation expense
+Added: Gains (losses) on settled commodity derivatives
+Added: ( 1,183,400 )
+Added: Proceeds from (payments for) derivative monetizations
Deferred income tax benefit
−Removed: Gain on early extinguishment of debt
+Added: Equity-based compensation expense
+Added: Equity in (earnings) loss of unconsolidated affiliate
+Added: Distributions/dividends of earnings from unconsolidated affiliate
+Added: Amortization of deferred revenue
+Added: Amortization of debt issuance costs, debt discount, debt premium and other
+Added: (Gain) loss on sale of assets
Loss on the sale of equity method investment shares
−Removed: Equity in (earnings) loss of unconsolidated affiliates
Water earnout
1 unchanged sentence
( 1,406,042 )
−Removed: Distributions/dividends of earnings from unconsolidated affiliates
−Removed: Amortization of deferred revenue
−Removed: Amortization of debt issuance costs, debt discount, debt premium and other
+Added: (Gain) loss on early extinguishment of debt
+Added: Loss on convertible note equitizations
Changes in current assets and liabilities:
11 unchanged sentences
( 1,254,118 )
−Removed: ( 1,254,118 )
Additions to water handling and treatment systems
7 unchanged sentences
Proceeds from VPP sale, net
+Added: Change in other liabilities
Change in other assets
1 unchanged sentence
( 1,041,490 )
−Removed: ( 1,041,490 )
Cash flows provided by (used in) financing activities:
Repurchases of common stock
−Removed: Issuance of senior notes by Antero Midstream Partners LP
+Added: Issuance of senior notes
Issuance of convertible notes
1 unchanged sentence
( 1,219,019 )
+Added: ( 1,554,657 )
Borrowings (repayments) on bank credit facilities, net
+Added: ( 1,017,000 )
Payment of debt issuance costs
Sale of noncontrolling interest
−Removed: Distributions to noncontrolling interests in Antero Midstream Partners LP
−Removed: Distributions to noncontrolling interests in Martica Holdings LLC
+Added: Distributions to noncontrolling interests
Employee tax withholding for settlement of equity compensation awards
+Added: Convertible note equitizations
Net cash provided by (used in) financing activities
Effect of deconsolidation of Antero Midstream Partners LP
−Removed: Net decrease in cash and cash equivalents
+Added: Net increase in cash and cash equivalents
Cash and cash equivalents, beginning of period
1 unchanged sentence
ANTERO RESOURCES CORPORATION
−Removed: Consolidated Statements of Cash Flows
+Added: Consolidated Statements of Cash Flows (Continued)
(In thousands)
2 unchanged sentences
Cash paid during the period for interest
−Removed: Decrease in accounts payable and accrued liabilities for additions to property and equipment
+Added: Increase (decrease) in accounts payable and accrued liabilities for additions to property and equipment
See accompanying notes to consolidated financial statements .
2 unchanged sentences
(1) Organization
−Removed: Antero Resources Corporation (individually referred to as “Antero”) and its consolidated subsidiaries (collectively referred to as “Antero Resources,” the “Company,” “we,” “us” or “our”) are engaged in the development, production, exploration and acquisition of natural gas, NGLs, and oil properties in the Appalachian Basin in West Virginia and Ohio.
+Added: Antero Resources Corporation (individually referred to as “Antero” and together with its consolidated subsidiaries “Antero Resources,” or the “Company”) is engaged in the development, production, exploration and acquisition of natural gas, NGLs and oil properties in the Appalachian Basin in West Virginia and Ohio.
The Company targets large, repeatable resource plays where horizontal drilling and advanced fracture stimulation technologies provide the means to economically develop and produce natural gas, NGLs and oil from unconventional formations.
−Removed: The Company’s corporate headquarters are located in Denver, Colorado.
+Added: The Company’s corporate headquarters is located in Denver, Colorado.
(2 ) Summary of Significant Accounting Policies
−Removed: (a) Basis of Presentation
+Added: Basis of Presentation
The accompanying consolidated financial statements of the Company have been prepared in accordance with accounting principles generally accepted in the United States (“GAAP”).
−Removed: In the opinion of management, the accompanying consolidated financial statements include all adjustments (consisting of normal and recurring accruals) considered necessary to present fairly the Company’s financial position as of December 31, 2019 and 2020, and the results of its operations and its cash flows for the years ended December 31, 2018, 2019 and 2020.
+Added: In the opinion of management, the accompanying consolidated financial statements include all adjustments (consisting of normal and recurring accruals) considered necessary to present fairly the Company’s financial position as of December 31, 2020 and 2021, and its results of operations and cash flows for the years ended December 31, 2019, 2020 and 2021.
The Company has no items of other comprehensive income or loss;
therefore, its net income or loss is equal to its comprehensive income or loss.
−Removed: (b) Principles of Consolidation
−Removed: The accompanying consolidated financial statements include the accounts of Antero Resources Corporation, its wholly owned subsidiaries, any entities in which the Company owns a controlling interest, and variable interest entities (“VIEs”) for which the Company is the primary beneficiary.
+Added: Principles of Consolidation
+Added: The accompanying consolidated financial statements include the accounts of Antero Resources Corporation, its wholly owned subsidiaries, any entities in which the Company owns a controlling interest and its variable interest entity (“VIE”), Martica Holdings LLC (“Martica”), for which the Company is the primary beneficiary.
+Added: All significant intercompany accounts and transactions have been eliminated in the Company’s consolidated financial statements.
Through March 12, 2019, Antero Midstream Partners LP (“Antero Midstream Partners”), a publicly traded limited partnership, was included in the consolidated financial statements of Antero.
Prior to the Closing (defined in Note 3—Deconsolidation of Antero Midstream Partners LP to the consolidated financial statements), the Company’s ownership of Antero Midstream Partners common units represented approximately a 53 % limited partner interest in Antero Midstream Partners, and Antero Resources consolidated Antero Midstream Partners’ financial position and results of operations into its consolidated financial statements.
−Removed: The Transactions (defined in Note 3—Deconsolidation of Antero Midstream Partners LP to the consolidated financial statements) resulted in the exchange of the limited partner interest Antero Resources owned in Antero Midstream Partners for common stock of Antero Midstream Corporation representing an approximate 31 % interest as of March 13, 2019.
−Removed: As a result, Antero Resources’ controlling interest in Antero Midstream Partners was converted to an interest in Antero Midstream Corporation that provides significant influence, but not control, over Antero Midstream Corporation.
+Added: The Simplification Transactions resulted in the exchange of the limited partner interest Antero Resources owned in Antero Midstream Partners for common stock of Antero Midstream Corporation (“Antero Midstream”) representing an approximate 31 % interest as of March 13, 2019.
+Added: As a result, Antero Resources’ controlling interest in Antero Midstream Partners was converted to an interest in Antero Midstream that provides significant influence, but not control, over Antero Midstream.
Thus, effective March 13, 2019, Antero no longer consolidates Antero Midstream Partners in its consolidated financial statements and accounts for its interest in Antero Midstream Corporation using the equity method of accounting.
−Removed: As of December 31, 2019 and 2020, the Company had a 28.7 % and 29.2 % interest, respectively, in Antero Midstream Corporation.
−Removed: See Note 6—Equity Method Investments and Note 3—Deconsolidation of Antero Midstream Partners LP to the consolidated financial statements for further discussion on equity method investments and the Transactions, respectively.
−Removed: For the year ended December 31, 2020, the Company determined that Martica Holdings LLC (“Martica”) is a VIE for which Antero is the primary beneficiary.
+Added: As of December 31, 2020 and 2021, the Company had a 29.2 % and 29.1 % interest, respectively, in Antero Midstream.
+Added: See Note 6—Equity Method Investments and Note 3—Deconsolidation of Antero Midstream Partners LP to the consolidated financial statements for further discussion on equity method investments and the Simplification Transactions, respectively.
+Added: For the years ended December 31, 2020 and 2021, the Company determined that Martica is a VIE for which Antero is the primary beneficiary.
Therefore, Martica’s accounts are consolidated in the Company’s consolidated financial statements.
4 unchanged sentences
● Antero owns the Class B Units in Martica, which entitle Antero to receive distributions in respect of the Incremental Override (as defined in Note 4—Transactions);
+Added: ● Antero provides accounting, administrative and other services to Martica under a Management Services Agreement.
ANTERO RESOURCES CORPORATION
Notes to Consolidated Financial Statements (Continued)
−Removed: ● Antero provides accounting, administrative and other services to Martica under a Management Services Agreement.
−Removed: All significant intercompany accounts and transactions have been eliminated in the Company’s consolidated financial statements.
−Removed: The noncontrolling interest in the Company’s consolidated financial statements for the years ended December 31, 2018 and 2019 represents the interests in Antero Midstream Partners that were owned by the public prior to the Transactions, and the incentive distribution rights in Antero Midstream Partners.
−Removed: The noncontrolling interest in the Company’s consolidated financial statements for the year ended December 31, 2020 represents the interest in Martica owned by third parties.
−Removed: See Note 4—Transactions to the consolidated financial statements for more information on the sale of this noncontrolling interest.
−Removed: Martica is a discrete entity and the assets and credits of Martica are not available to satisfy the debts and obligations of the Company or its other subsidiaries.
Investments in entities for which the Company exercises significant influence, but not control, are accounted for under the equity method.
4 unchanged sentences
When a distribution is received, it is recorded as a reduction to the carrying value of that investment on the Company’s balance sheet.
−Removed: The Company’s equity in earnings of unconsolidated affiliates is adjusted for intercompany transactions and the basis differences recognized due to the difference between the cost of the equity method investment in Antero Midstream Corporation and the amount of underlying equity in the net assets of Antero Midstream Partners as of the date of deconsolidation.
+Added: The Company’s equity in earnings of unconsolidated affiliates is adjusted for intercompany transactions and the basis differences recognized due to the difference between the cost of the equity method investment in Antero Midstream and the amount of underlying equity in the net assets of Antero Midstream Partners as of the date of deconsolidation.
The Company accounts for distributions received from equity method investees under the “nature of the distribution” approach.
Under this approach, distributions received from equity method investees are classified on the basis of the nature of the activity or activities of the investee that generated the distribution as either a return on investment (classified as cash inflows from operating activities) or a return of investment (classified as cash inflows from investing activities).
−Removed: (c) Use of Estimates
+Added: Use of Estimates
The preparation of consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect revenues, expenses, assets, liabilities and the disclosure of contingent assets and liabilities.
3 unchanged sentences
Other items in the Company’s consolidated financial statements that involve the use of significant estimates include derivative assets and liabilities, accrued revenue, deferred and current income taxes, asset retirement obligations and commitments and contingencies.
−Removed: (d) Risks and Uncertainties
+Added: Risks and Uncertainties
The markets for natural gas, NGLs and oil have, and continue to, experience significant price fluctuations.
1 unchanged sentence
Increases or decreases in the prices the Company receives for its production could have a significant impact on the Company’s future results of operations and reserve quantities.
−Removed: (e) Cash and Cash Equivalents
+Added: Cash and Cash Equivalents
The Company considers all liquid investments purchased with an initial maturity of three months or less to be cash equivalents.
2 unchanged sentences
The Company classifies book overdrafts in accounts payable and revenue distributions payable within its consolidated balance sheets, and classifies the change in accounts payable associated with book overdrafts as an operating activity within its consolidated statements of cash flows.
−Removed: As of December 31, 2020, the book overdraft included within accounts payable and
−Removed: ANTERO RESOURCES CORPORATION
−Removed: Notes to Consolidated Financial Statements (Continued)
−Removed: revenue distributions payable were $ 11 million and $ 15 million, respectively.
As of December 31, 2020, the book overdraft included within accounts payable and revenue distributions payable were $ 7 million and $ 18 million, respectively.
−Removed: (f) Oil and Gas Properties
+Added: As of December 31, 2021, the book overdraft included within accounts payable and revenue distributions payable were $ 5 million and $ 52 million, respectively.
+Added: Oil and Gas Properties
The Company accounts for its natural gas, NGLs and oil exploration and development activities under the successful efforts method of accounting.
2 unchanged sentences
Exploration costs, including personnel and other internal costs, geological and geophysical expenses, delay rentals for gas and oil leases, and costs associated with unsuccessful lease acquisitions are charged to expense as incurred.
−Removed: Exploratory drilling costs are initially capitalized, but charged to expense if the Company determines that the well does not contain reserves in commercially viable quantities.
+Added: Exploratory drilling costs are initially capitalized,
+Added: ANTERO RESOURCES CORPORATION
+Added: Notes to Consolidated Financial Statements (Continued)
+Added: but charged to expense if the Company determines that the well does not contain reserves in commercially viable quantities.
The Company reviews exploration costs related to wells-in- progress at the end of each quarter and makes a determination, based on known results of drilling at that time, whether the costs should continue to be capitalized pending further well testing and results, or charged to expense.
1 unchanged sentence
The Company incurred no such expenses during the years ended December 31, 2020 and 2021.
−Removed: The sale of a partial interest in a proved property is accounted for as a cost recovery, and no gain or loss is recognized as long as this treatment does not significantly affect the units-of- production amortization rate.
+Added: The sale of a partial interest in a proved property is accounted for as a normal retirement, and no gain or loss is recognized as long as this treatment does not significantly affect the units-of- production amortization rate.
A gain or loss is recognized for all other sales of producing properties.
2 unchanged sentences
Unproved properties and the related costs are transferred to proved properties when reserves are discovered on, or otherwise attributed to, the property.
−Removed: Proceeds from sales of partial interests in unproved properties are accounted for as a recovery of cost without recognition of any gain or loss until the cost has been recovered.
+Added: Proceeds from sales of partial interests in unproved properties are accounted for as a cost recovery without recognition of any gain or loss until the cost has been recovered.
Impairment of unproved properties was $ 393 million, $ 224 million and $ 91 million for the years ended December 31, 2019, 2020 and 2021, respectively.
10 unchanged sentences
Depletion expense for oil and gas properties was $ 884 million, $ 854 million, and $ 736 million for the years ended December 31, 2019, 2020 and 2021, respectively.
−Removed: (g) Impairment of Long-Lived Assets Other than Oil and Gas Properties
+Added: Impairment of Long-Lived Assets Other than Oil and Gas Properties
The Company evaluates its long- lived assets other than oil and gas properties for impairment when events or changes in circumstances indicate that the related carrying values of the assets may not be recoverable.
1 unchanged sentence
If the carrying values of the assets are deemed not recoverable, the carrying values are reduced to the estimated fair values, which are based on discounted future cash flows using assumptions as to revenues, costs, and discount rates typical of third party market participants, which is a Level 3 fair value measurement.
−Removed: ANTERO RESOURCES CORPORATION
−Removed: Notes to Consolidated Financial Statements (Continued)
−Removed: Impairment of long-lived assets other than oil and gas properties were $ 10 million and $ 15 million for the years ended December 31, 2018 and 2019, respectively, and were associated with midstream assets.
−Removed: There were no such impairments for the year ended December 31, 2020.
−Removed: (h) Other Property and Equipment
+Added: Impairment of long-lived assets other than oil and gas properties was $ 15 million for the year ended December 31, 2019, which was associated with midstream assets.
+Added: There were no such impairments for the years ended December 31, 2020 and 2021.
+Added: Other Property and Equipment
Other property and equipment assets are depreciated using the straight-line method over their estimated useful lives, which range from two to 20 years .
1 unchanged sentence
A gain or loss is recognized upon the sale or disposal of other property and equipment.
−Removed: (i) Debt Issuance Costs
+Added: ANTERO RESOURCES CORPORATION
+Added: Notes to Consolidated Financial Statements (Continued)
+Added: Debt Issuance Costs
Debt issuance costs represent loan origination fees and other initial borrowing costs.
−Removed: Such costs are capitalized and included in Other assets on the consolidated balance sheets if related to the Company’s revolving credit facility, and are included as a reduction to Long-term debt on the consolidated balance sheets if related to the issuance of the Company’s senior notes and 2026 Convertible Notes (as defined below in Note 8—Long-Term Debt).
+Added: Such costs are capitalized and included in Other assets on the consolidated balance sheets if related to the Company’s Credit Facility, and are included as a reduction to Long-term debt on the consolidated balance sheets if related to the issuance of the Company’s senior notes and 2026 Convertible Notes (as defined below in Note 8—Long-Term Debt).
These costs are amortized over the term of the related debt instrument.
2 unchanged sentences
As of December 31, 2021, the Company had $ 8 million of unamortized debt issuance costs included in other long-term assets, and $ 22 million of unamortized debt issuance costs included as a reduction to long-term debt.
−Removed: The amounts amortized and the write-off of previously deferred debt issuance costs were $ 13 million, $ 11 million, and $ 8 million for the years ended December 31, 2018, 2019 and 2020, respectively.
−Removed: (j) Derivative Financial Instruments
+Added: The amortization and write-off related to deferred debt issuance costs was $ 11 million, $ 8 million, and $ 7 million for the years ended December 31, 2019, 2020 and 2021, respectively.
+Added: Derivative Financial Instruments
In order to manage its exposure to natural gas, NGLs and oil price volatility, the Company enters into derivative transactions from time to time, which may include commodity swap agreements, basis swap agreements, collar agreements and other similar agreements related to the price risk associated with the Company’s production.
5 unchanged sentences
The Company’s derivatives have not been designated as hedges for accounting purposes.
−Removed: (k) Asset Retirement Obligations
+Added: Asset Retirement Obligations
The Company is obligated to dispose of certain long- lived assets upon their abandonment.
4 unchanged sentences
The liability is accreted at the end of each period through charges to operating expense.
−Removed: (l) Environmental Liabilities
+Added: Environmental Liabilities
Environmental expenditures that relate to an existing condition caused by past operations, and that do not contribute to current or future revenue generation, are expensed as incurred.
2 unchanged sentences
As of December 31, 2020 and 2021, the Company did not have a material amount accrued for any environmental liabilities, nor has the Company been cited for any environmental violations that it believes are likely to have a material adverse effect on its financial position, results of operations or cash flows.
−Removed: ANTERO RESOURCES CORPORATION
−Removed: Notes to Consolidated Financial Statements (Continued)
−Removed: (m) Natural Gas, NGLs, and Oil Revenues
+Added: Natural Gas, NGLs and Oil Revenues
The Company’s revenues are primarily derived from the sale of natural gas and oil production, as well as the sale of NGLs that are extracted from the Company’s natural gas.
3 unchanged sentences
Natural gas is transported from the wellheads to delivery points specified under sales contracts.
−Removed: To deliver natural gas to these points, Antero Midstream Corporation or other third parties gather, compress, process and transport the Company’s natural gas.
+Added: To deliver natural gas to these points, Antero Midstream or other third parties gather, compress, process and transport the Company’s natural gas.
The Company maintains control of the natural gas during gathering, compression, processing, and transportation.
−Removed: The Company’s sales contracts provide that it receives a specific index price adjusted for pricing differentials.
+Added: The Company’s sales contracts provide that
+Added: ANTERO RESOURCES CORPORATION
+Added: Notes to Consolidated Financial Statements (Continued)
+Added: it receives a specific index price adjusted for pricing differentials.
The Company transfers control of the product at the delivery point and recognizes revenue based on the contract price.
−Removed: The costs incurred to gather, compress, process and transport natural gas are recorded as Gathering, compression, processing and transportation expense.
+Added: The costs incurred to gather, compress, process and transport natural gas are recorded as Gathering, compression, processing and transportation expense on the Company’s consolidated statements of operations.
NGLs, which are extracted from natural gas through processing, are either sold by the Company directly or by the processor under processing contracts.
5 unchanged sentences
The Company recognizes revenue based on the contract price when it transfers control of the product to a purchaser.
−Removed: When applicable, the costs incurred to transport oil to a purchaser are recorded as Gathering, compression, processing and transportation expense.
−Removed: (n) Marketing Revenues and Expenses
+Added: When applicable, the costs incurred to transport oil to a purchaser are recorded as Gathering, compression, processing and transportation expense on the Company’s consolidated statements of operations.
+Added: Marketing Revenues and Expenses
Marketing revenues are derived from activities to purchase and sell third-party natural gas and NGLs and to market excess firm transportation capacity to third parties.
3 unchanged sentences
The Company satisfies performance obligations to the purchaser by transferring control of the product at the delivery point and recognizes revenue based on the contract price received from the purchaser.
−Removed: Fees generated from the sale of excess firm transportation marketed to third parties are included in Marketing revenue.
+Added: Fees generated from the sale of excess firm transportation marketed to third parties are included in Marketing revenue on the Company’s consolidated statements of operations.
Marketing expenses include the cost of purchased third-party natural gas and NGLs.
The Company classifies firm transportation costs related to capacity contracted for in advance of having sufficient production and infrastructure to fully utilize the capacity (excess capacity) as marketing expenses since it is marketing this excess capacity to third parties.
−Removed: Firm transportation for which the Company has sufficient production capacity (even though it may not use the transportation capacity because of alternative delivery points with more favorable pricing) is considered unutilized capacity and is charged to transportation expense.
−Removed: (o) Deferred Revenue
+Added: Firm transportation for which the Company has sufficient production capacity (even though it may not use the transportation capacity because of alternative delivery points with more favorable pricing) is considered unutilized capacity and is charged to transportation expense on the Company’s consolidated statements of operations.
+Added: Deferred Revenue
Under the terms of the VPP (as defined below in Note 4—Transactions), the Company is obligated to deliver certain natural gas volumes from specified wells to an overriding royalty interest owner over the term of the arrangement.
−Removed: The Company has accounted for the VPP as a conveyance under Accounting Standard Codifications (“ASC”) Topic 932, Extractive Industries—Oil and Gas (“ASC 932”), which requires the net proceeds to be recorded as deferred revenue due to the Company’s future performance obligations.
+Added: The Company has accounted for the VPP as a conveyance under FASB ASC Topic 932, Extractive Industries—Oil and Gas (“ASC 932”), which requires the net proceeds to be recorded as deferred revenue due to the Company’s future performance obligations.
Revenue is recognized as volumes are delivered using the units-of-production method over the term of the VPP in Amortization of deferred revenue on the Company’s consolidated statements of operations.
See Note 4—Transactions to the consolidated financial statements for further discussion of the VPP.
−Removed: ANTERO RESOURCES CORPORATION
−Removed: Notes to Consolidated Financial Statements (Continued)
−Removed: (p) Gathering, Compression, Water Handling and Treatment Revenue
+Added: Gathering, Compression, Water Handling and Treatment Revenue
Substantially all revenues from the gathering, compression, water handling and treatment operations were derived from transactions for services Antero Midstream Partners provided to the Company’s exploration and production operations through March 12, 2019 and were eliminated in consolidation.
Effective March 13, 2019, Antero Midstream Partners is no longer consolidated in Antero’s results.
−Removed: See Note 3 —Deconsolidation of Antero Midstream Partners LP and Note 18—Segment Information to the consolidated financial statements for further discussion on the Transactions and the Company’s reportable segments, respectively.
+Added: See Note 3 —Deconsolidation of Antero Midstream Partners LP and Note 18—Reportable Segments to the consolidated financial statements for further discussion on the Simplification Transactions and the Company’s reportable segments, respectively.
The portion of such fees shown in the Company’s consolidated financial statements prior to March 13, 2019 represent amounts charged to interest owners in Antero-operated wells, as well as fees charged to other third parties for water handling and treatment services provided by Antero Midstream Partners or usage of Antero Midstream Partners’ gathering and compression systems.
−Removed: For gathering and compression revenue, Antero Midstream Partners satisfied its performance obligations and recognized revenue when low pressure volumes were delivered to a compressor station, high pressure volumes were delivered to a processing plant or transmission pipeline, and compression volumes were delivered to a high pressure line.
+Added: For gathering and compression revenue, Antero Midstream Partners satisfied its performance obligations and recognized revenue when low pressure volumes were delivered to a compressor station, high pressure volumes were delivered to a processing
+Added: ANTERO RESOURCES CORPORATION
+Added: Notes to Consolidated Financial Statements (Continued)
+Added: plant or transmission pipeline, and compression volumes were delivered to a high pressure line.
Revenue was recognized based on the per Mcf gathering or compression fee charged by Antero Midstream Partners in accordance with the gathering and compression agreement.
2 unchanged sentences
Revenue was recognized based on the per barrel fresh water delivery or wastewater treatment fee charged by Antero Midstream Partners in accordance with the water services agreement.
−Removed: (q) Concentrations of Credit Risk
+Added: Concentrations of Credit Risk
The Company’s revenues are derived principally from uncollateralized sales to purchasers in the oil and gas industry or the utilities industry.
3 unchanged sentences
Year Ended December 31,
−Removed: Mercuria Energy America, Inc.
−Removed: Tenaska Marketing Ventures
−Removed: Year Ended December 31, 2019
−Removed: Sabine Pass Liquefaction LLC
−Removed: WGL Midstream
−Removed: Year Ended December 31, 2020
+Added: Six One Commodities LLC (1)
Sabine Pass Liquefaction LLC
−Removed: WGL Midstream
+Added: (1) Six One Commodities LLC acquired WGL Midstream during the year ended December 31, 2021.
+Added: WGL Midstream was the Company's major customer during the years ended December 31, 2019 and 2020.
+Added: Sabine Pass Liquefaction LLC was not a major customer during the year ended December 31, 2021.
The Company is also exposed to credit risk on its commodity derivative portfolio.
1 unchanged sentence
The Company has economic hedges in place with 10 different counterparties.
−Removed: The fair value of the Company’s commodity net derivative contracts is approximately $ 22 million as of December 31, 2020 and primarily included the following net derivative assets by bank counterparty:
−Removed: Morgan Stanley - $ 35 million;
−Removed: Canadian Imperial Bank of Commerce - $ 25 million;
−Removed: Scotiabank - $ 14 million;
−Removed: Natixis - $ 5 million;
−Removed: DNB Capital - $ 2 million;
−Removed: and Truist $ 1 million.
+Added: As of December 31, 2021, the Company did not have any commodity derivative assets with bank counterparties under our Credit Facility (as defined below in Note 8—Long-Term Debt).
The estimated fair value of commodity derivative assets has been risk-adjusted using a discount rate based upon the respective published credit default swap rates (if available, or if not available, a discount rate based on the applicable Reuters bond rating) as of December 31, 2021 for each of the European and American banks.
1 unchanged sentence
The Company, at times, may have cash in banks in excess of federally insured amounts.
−Removed: ANTERO RESOURCES CORPORATION
−Removed: Notes to Consolidated Financial Statements (Continued)
−Removed: (r) Income Taxes
The Company recognizes deferred tax assets and liabilities for temporary differences resulting from net operating loss (“NOL”) carryforwards for income tax purposes and the differences between the financial statement and tax basis of assets and liabilities.
3 unchanged sentences
The Company recognizes interest expense related to unrecognized tax benefits in interest expense and fines and penalties for tax-related matters as income tax expense.
−Removed: (s) Fair Value Measurements
−Removed: The Financial Accounting Standards Board (“FASB”) ASC Topic 820, Fair Value Measurements and Disclosures , clarifies the definition of fair value, establishes a framework for measuring fair value, and expands disclosures about fair value measurements.
+Added: Fair Value Measurements
+Added: The FASB ASC Topic 820, Fair Value Measurements and Disclosures , clarifies the definition of fair value, establishes a framework for measuring fair value, and expands disclosures about fair value measurements.
This guidance also relates to all nonfinancial assets and liabilities that are not recognized or disclosed on a recurring basis (e.g., those measured at fair value in a business combination, the initial recognition of asset retirement obligations, and impairments of proved oil and gas properties and other long- lived assets).
−Removed: Fair value is the price that the Company estimates would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date.
+Added: Fair value is the price that the Company estimates would be received to sell an asset or paid to transfer a
+Added: ANTERO RESOURCES CORPORATION
+Added: Notes to Consolidated Financial Statements (Continued)
+Added: liability in an orderly transaction between market participants at the measurement date.
A fair value hierarchy is used to prioritize inputs to valuation techniques used to estimate fair value.
5 unchanged sentences
Valuation models used to measure fair value of these instruments consider various Level 2 inputs including (i) quoted forward prices for commodities, (ii) time value, (iii) quoted forward interest rates, (iv) current market prices and contractual prices for the underlying instruments, (v) risk of nonperformance by the Company and the counterparty, and (vi) other relevant economic measures.
−Removed: (t) Industry Segments and Geographic Information
+Added: Reportable Segments and Geographic Information
Management has evaluated how the Company is organized and managed and has identified the following segments:
−Removed: (1) the exploration, development, and production of natural gas, NGLs, and oil;
−Removed: (2) marketing and utilization of excess firm transportation capacity and (3) midstream services through the Company’s equity method investment in Antero Midstream Corporation.
+Added: (i) the exploration, development and production of natural gas, NGLs and oil;
+Added: (ii) marketing and utilization of excess firm transportation capacity;
+Added: and (iii) midstream services through the Company’s equity method investment in Antero Midstream.
Through March 12, 2019, the results of Antero Midstream Partners were included in the consolidated financial statements of Antero.
Effective March 13, 2019, Antero no longer consolidated the results of Antero Midstream Partners in Antero’s results;
−Removed: however, the Company’s segment disclosures include the Company’s equity method investment in Antero Midstream Corporation due to its significance to the Company’s operations.
−Removed: See Note 3—Deconsolidation of Antero Midstream Partners LP and Note 18—Segment Information to the consolidated financial statements for further discussion on the Transactions and the Company’s reportable segments, respectively.
+Added: however, the Company’s segment disclosures include the Company’s equity method investment in Antero Midstream due to its significance to the Company’s operations.
+Added: See Note 3—Deconsolidation of Antero Midstream Partners LP and Note 18—Reportable Segments to the consolidated financial statements for further discussion on the Simplification Transactions and the Company’s reportable segments, respectively.
All of the Company’s assets are located in the United States and substantially all of its production revenues are attributable to customers located in the United States;
however, some of the Company’s production revenues are attributable to customers who then transport the Company’s production to foreign countries for resale or consumption.
−Removed: (u) Earnings (Loss) Per Common Share
+Added: Earnings (Loss) Per Common Share
Earnings (loss) per common share—basic for each period is computed by dividing net income (loss) attributable to Antero by the basic weighted average number of shares outstanding during the period.
−Removed: Earnings (loss) per common share—diluted for each period is computed after giving consideration to the potential dilution from (i) outstanding equity awards, calculated using the treasury stock method, and (ii) shares of common stock issuable upon conversion of the 2026 Convertible Notes (as defined below in Note 8—Long-Term Debt), calculated using the if-converted method.
−Removed: The Company includes restricted stock unit (“RSUs”) awards, performance share unit (“PSUs”) awards and stock options in the calculation of diluted weighted average shares outstanding based on the number of common shares that would be issuable if the end of the period was also the end of the performance period required for the vesting of the awards.
−Removed: During periods in which the Company incurs a net loss, diluted weighted average shares outstanding are equal to basic weighted average shares outstanding because the effect of all equity awards is anti-dilutive.
+Added: Earnings (loss) per common share—diluted for each period is computed after giving consideration to the potential dilution from outstanding equity awards and shares of common stock issuable upon conversion of the 2026 Convertible Notes (as defined below in Note 8—Long-Term Debt).
+Added: The Company includes restricted stock unit (“RSU”) awards, performance share unit (“PSU”) awards and stock options in the calculation of diluted weighted average shares outstanding based on the number of common shares that would be issuable if the end of the period was also the end of the performance period required for the vesting of the awards.
+Added: The potential dilutive effect of the 2026 Convertible Notes is calculated using the (i) treasury stock method for the year ended December 31, 2020 as a result of the Company’s intent to settle the principal amount of such convertible notes in cash upon conversion during year ended December 31, 2020, and (ii) if-converted method for the year ended December 31, 2021, as a result of the partial equitizations of the 2026 Convertible Notes during the year ended December 31, 2021.
+Added: See Note 8—Long-Term Debt for further discussion on the equitization transactions.
+Added: During periods in which the Company incurs a net loss, diluted weighted average shares outstanding are equal to basic weighted average shares outstanding because the effects of all equity awards and the 2026 Convertible Notes are anti-dilutive.
ANTERO RESOURCES CORPORATION
4 unchanged sentences
Dilutive effect of RSUs
−Removed: Dilutive effect of outstanding stock options
Dilutive effect of PSUs
+Added: Dilutive effect of outstanding stock options
Dilutive effect of 2026 Convertible Notes
3 unchanged sentences
2026 Convertible Notes (2)
−Removed: (1) The potential dilutive effects of these awards were excluded from the computation of earnings (loss) per common share—assuming dilution because the inclusion of these awards would have been anti-dilutive.
−Removed: (2) In August 2020 and September 2020, the Company issued $ 287.5 million in aggregate principal amount of 2026 Convertible Notes (as defined below in Note 8—Long-Term Debt).
−Removed: (3) On January 12, 2021, the Company completed the Equitization Transactions (defined below in Note 8—Long-Term Debt) whereby the Company issued 31.4 million shares and repurchased $ 150 million aggregate principal amount of the 2026 Convertible Notes.
+Added: (1) The potential dilutive effects of these awards were excluded from the computation of earnings (loss) per common share—diluted because the inclusion of these awards would have been anti-dilutive.
+Added: (2) Under the treasury stock method, only the amount by which the conversion value exceeds the aggregate principal amount of the 2026 Convertible Notes is considered in the diluted earnings per share computation.
+Added: As of December 31, 2020, the conversion value did not exceed the principal amount of the notes.
+Added: On January 12, 2021, the Company completed the January Equitization Transactions (defined below in Note 8—Long-Term Debt) whereby the Company issued 31.4 million shares and repurchased $ 150 million aggregate principal amount of the 2026 Convertible Notes.
See Note 8—Long-Term Debt to the consolidated financial statements for further discussion on this transaction.
−Removed: (v) Treasury Share Retirement
+Added: Treasury Share Retirement
The Company retires treasury shares acquired through share repurchases and returns those shares to the status of authorized but unissued.
−Removed: When treasury shares are retired, the Company’s policy is to allocate the excess of the repurchase price over the par value of shares acquired first, to additional paid-in capital, and then to accumulated earnings.
+Added: When treasury shares are retired, the Company’s policy is to allocate the excess of the repurchase price over the par value of shares acquired first to additional paid-in capital and then to accumulated earnings (deficit) thereafter.
The portion allocable to additional paid-in capital is determined by applying a percentage, determined by dividing the number of shares to be retired by the number of shares outstanding, to the balance of additional paid-in capital as of retirement.
−Removed: (w) Equity-Based Compensation
+Added: Equity-Based Compensation
The Company recognizes compensation cost related to all equity-based awards in the financial statements based on their estimated grant date fair value.
−Removed: The Company is authorized to grant various types of equity-based compensation awards including stock options, stock appreciation rights, restricted stock awards, restricted stock unit awards, dividend equivalent awards, and other types of awards.
+Added: The Company is authorized to grant various types of equity-based compensation awards including stock options, stock appreciation rights, restricted stock awards, restricted share unit awards, performance share unit awards, dividend equivalent awards and other types of awards.
The grant date fair values are determined based on the type of award and may utilize market prices on the date of grant, Black-Scholes option-pricing model, Monte Carlo simulations or other acceptable valuation methodologies, as appropriate for the type of equity-based award.
1 unchanged sentence
Forfeitures are accounted for as they occur by reversing the expense previously recognized for awards that were forfeited during the period.
−Removed: See Note 10—Equity-Based Compensation and Retention Awards to the consolidated financial statements for additional information regarding the Company’s equity-based compensation.
−Removed: (x) Recently Issued Accounting Standard
−Removed: On August 5, 2020, the FASB issued Accounting Standards Update No.
+Added: See Note 10—Equity-Based Compensation and Cash Awards to the consolidated financial statements for additional information regarding the Company’s equity-based compensation.
+Added: Recently Issued Accounting Standard
+Added: Convertible Instruments
+Added: In August 2020, the FASB issued ASU No.
2020-06, Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity , which eliminates the cash conversion model in ASC 470-20, Debt with Conversion and Other Options , that require separate accounting for conversion features, and instead, allows the debt instrument and conversion features to be accounted for as a single debt instrument.
−Removed: The new standard becomes effective for the Company on January 1, 2022, and early adoption is permitted.
−Removed: The Company is evaluating its plans for adoption, including the adoption date and transition method.
−Removed: Upon adoption of this new standard, the Company expects to reclassify $ 85 million, net of deferred income taxes and equity issuance costs, to long-term debt and deferred income tax liability, as applicable, from stockholders’ equity as of December 31, 2020, which amount is subject to adjustment for any conversions or other transactions until adoption of this new standard.
−Removed: Additionally,
+Added: It is effective for interim and annual reporting periods beginning after December 15, 2021.
+Added: The Company will adopt the standard effective January 1, 2022 under the modified retrospective transition method.
+Added: Upon adoption of this new standard, the Company will reclassify $ 24 million, net of deferred income taxes and equity
ANTERO RESOURCES CORPORATION
Notes to Consolidated Financial Statements (Continued)
−Removed: annual interest expense for the 2026 Convertible Notes will be based on an effective interest rate of 4.8 % as compared to 15.1 % for the year ended December 31, 2020 and the weighted average diluted shares outstanding will increase from zero for the year ended December 31, 2020 to 63 million under the if-converted method after giving effect to the Equitization Transactions (defined below in Note 8—Long-Term Debt).
+Added: issuance costs, from additional paid-in capital and increase long-term debt by $27 million, reduce deferred income tax liability by $6 million and reduce accumulated deficit by $3 million as of January 1, 2022.
+Added: Additionally, annual interest expense for the 2026 Convertible Notes beginning January 1, 2022 will be based on an effective interest rate of 4.9 % as compared to 15.3 % for the year ended December 31, 2021.
The Company does not believe that adoption of the standard will impact its operational strategies or development prospects.
+Added: In December 2019, the FASB issued ASU No.
+Added: 2019-12, Simplifying the Accounting for Income Taxes .
+Added: This ASU removes certain exceptions to the general principles in ASC 740, Income Taxes (“ASC 740”) and also simplifies portions of ASC 740 by clarifying and amending existing guidance.
+Added: It is effective for interim and annual reporting periods beginning after December 15, 2020.
+Added: The Company adopted this ASU on January 1, 2021, and it did not have a material impact on the Company's consolidated financial statements.
(3) Deconsolidation of Antero Midstream Partners LP
−Removed: On March 12, 2019, Antero Midstream GP LP and Antero Midstream Partners completed (the “Closing”) the transactions contemplated by the Simplification Agreement (the “Simplification Agreement”), dated as of October 9, 2018, by and among Antero Midstream GP LP, Antero Midstream Partners and certain of their affiliates, pursuant to which (i) Antero Midstream GP LP was converted from a limited partnership to a corporation under the laws of the State of Delaware and changed its name to Antero Midstream Corporation, and (ii) an indirect, wholly owned subsidiary of Antero Midstream Corporation was merged with and into Antero Midstream Partners, with Antero Midstream Partners surviving the merger as an indirect, wholly owned subsidiary of Antero Midstream Corporation (together, along with the other transactions contemplated by the Simplification Agreement, the “Transactions”).
+Added: On March 12, 2019, Antero Midstream GP LP and Antero Midstream Partners completed (the “Closing”) the transactions contemplated by the Simplification Agreement, dated as of October 9, 2018, by and among Antero Midstream GP LP, Antero Midstream Partners and certain of their affiliates (the “Simplification Agreement”), pursuant to which (i) Antero Midstream GP LP was converted from a limited partnership to a corporation under the laws of the State of Delaware and changed its name to Antero Midstream Corporation, and (ii) an indirect, wholly owned subsidiary of Antero Midstream Corporation was merged with and into Antero Midstream Partners, with Antero Midstream Partners surviving the merger as an indirect, wholly owned subsidiary of Antero Midstream Corporation (together, along with the other transactions contemplated by the Simplification Agreement, the “ Simplification Transactions”).
In connection with the Closing, Antero received $ 297 million in cash and 158.4 million shares of Antero Midstream Corporation common stock in consideration for 98,870,335 common units representing limited partnership interests in Antero Midstream Partners.
−Removed: The Company recorded a gain on deconsolidation of $ 1.4 billion calculated as the sum of (i) the cash proceeds received, (ii) the fair value of the Antero Midstream Corporation common stock received at the Closing, and (iii) the elimination of the noncontrolling interest, less the carrying amount of the investment in Antero Midstream Partners.
−Removed: The fair value of Antero’s retained equity method investment on March 13, 2019 in Antero Midstream Corporation was $ 2.0 billion based on the market price of the shares received on March 12, 2019.
+Added: The Company recorded a gain on deconsolidation of $ 1.4 billion calculated as the sum of (i) the cash proceeds received, (ii) the fair value of the Antero Midstream common stock received at the Closing, and (iii) the elimination of the noncontrolling interest, less the carrying amount of the investment in Antero Midstream Partners.
+Added: The fair value of Antero’s retained equity method investment on March 13, 2019 in Antero Midstream was $ 2.0 billion based on the market price of the shares received on March 12, 2019.
See Note 6—Equity Method Investments to the consolidated financial statements for further discussion on equity method investments.
Antero Midstream Partners’ results of operations are no longer consolidated in the Company’s consolidated statement of operations and comprehensive income (loss) beginning March 13, 2019.
−Removed: Because Antero Midstream Partners does not meet the requirements of a discontinued operation, Antero Midstream Partners’ results of operations continue to be included in the Company’s consolidated statement of operations and comprehensive income (loss) through March 12, 2019.
−Removed: Summarized Financial Information of Antero Midstream Partners
−Removed: The following table presents a summary of assets and liabilities of Antero Midstream Partners as of March 12, 2019, the date of deconsolidation.
−Removed: (in thousands)
−Removed: March 12, 2019
−Removed: Current assets
−Removed: Property and equipment, net
−Removed: Noncurrent assets
−Removed: Current liabilities
−Removed: Long-term debt
−Removed: Other noncurrent liabilities
−Removed: Total liabilities
−Removed: ANTERO RESOURCES CORPORATION
−Removed: Notes to Consolidated Financial Statements (Continued)
+Added: Because Antero Midstream Partners does not meet the requirements of a discontinued operation, Antero Midstream Partners’ results of operations continued to be included in the Company’s consolidated statement of operations and comprehensive income (loss) through March 12, 2019.
(4) Transactions
3 unchanged sentences
All cash contributed by Sixth Street at the initial closing was distributed to the Company.
−Removed: The Company met the applicable production threshold during the third quarter of 2020 and received a $ 51 million cash distribution during the year ended December 31, 2020.
+Added: The Company met the applicable production thresholds related to the third quarter of 2020 and the first quarter of 2021 as of September 30, 2020 and March 31, 2021, respectively.
+Added: The Company received a $ 51 million cash distribution during each of the years ended December 31, 2020 and 2021.
+Added: ANTERO RESOURCES CORPORATION
+Added: Notes to Consolidated Financial Statements (Continued)
The ORRIs include an overriding royalty interest of 1.25 % of the Company’s working interest in all of its operated proved developed properties in West Virginia and Ohio, subject to certain excluded wells (the “Initial PDP Override”), and an overriding royalty interest of 3.75 % of the Company’s working interest in all of its undeveloped properties in West Virginia and Ohio (the “Development Override”).
−Removed: Wells turned to sales after April 1, 2020 and prior to the later of (a) the date on which the Company turns to sales 2.2 million lateral feet (net to the Company’s interest) of horizontal wells burdened by the Development Override and (b) the earlier of (i) April 1, 2023 and (ii) the date on which the Company turns to sales 3.82 million lateral feet (net to the Company’s interest) of horizontal wells are subject to the Development Override.
+Added: Wells turned to sales after April 1, 2020 and prior to the later of (a) the date on which the Company turns to sales 2.2 million lateral feet (net to the Company’s interest) of horizontal wells burdened by the Development Override or (b) the earlier of (i) April 1, 2023 or (ii) the date on which the Company turns to sales 3.82 million lateral feet (net to the Company’s interest) of horizontal wells are subject to the Development Override.
The ORRIs also include an additional overriding royalty interest of 2.00 % of the Company’s working interest in the properties underlying the Initial PDP Override (the “Incremental Override”).
9 unchanged sentences
Morgan Ventures Energy Corporation ("JPM-VEC") to convey, effective July 1, 2020, an overriding royalty interest in dry gas producing properties in West Virginia (the "VPP Properties") equal to 136,589,000 MMBtu over the expected seven-year term of the VPP.
−Removed: The Company has accounted for the VPP as a conveyance under ASC 932, and the net proceeds were recorded as deferred revenue in the consolidated balance sheet.
+Added: The Company has accounted for the VPP as a conveyance under ASC 932, and the net proceeds were recorded as deferred revenue in the consolidated balance sheet as of the transaction closing.
Deferred revenue is recognized as volumes are delivered using the units-of-production method over the term of the VPP.
3 unchanged sentences
See Note 12—Derivative Instruments to the consolidated financial statements for more information on the Company’s derivative instruments.
+Added: Drilling Partnership
+Added: On February 17, 2021, Antero Resources announced the formation of a drilling partnership with QL Capital Partners (“QL”), an affiliate of Quantum Energy Partners, for the Company’s 2021 through 2024 drilling program .
+Added: Under the terms of the arrangement, each year in which QL participates represents an annual tranche, and QL will be conveyed a working interest in any wells spud by Antero Resources during such tranche year.
+Added: For 2021 and 2022, Antero Resources and QL agreed to the estimated internal rate of return (“IRR”) of the Company’s capital budget for each annual tranche, and QL agreed to participate in the 2021 and 2022 tranches.
+Added: For each subsequent year through 2024, Antero Resources will propose a capital budget and estimated IRR for all wells to be spud during such year, and subject to the mutual agreement of the parties that the estimated IRR for the year exceeds a specified return, QL will be obligated to participate in such tranche.
+Added: Antero Resources develops and manages the drilling program associated with each tranche, including the selection of wells.
+Added: Additionally, for each annual tranche in which QL participates, Antero Resources and QL will enter into assignments, bills of sale and conveyances pursuant to which QL will be conveyed a proportionate working interest
ANTERO RESOURCES CORPORATION
Notes to Consolidated Financial Statements (Continued)
−Removed: Subsequent Event
−Removed: Drilling Partnership
−Removed: On February 17, 2021, Antero Resources announced the formation of a drilling partnership with QL Capital Partners (“QL”), an affiliate of Quantum Energy Partners.
−Removed: Under the terms of the arrangement, QL will fund 20 % of total development capital spending in 2021 and is expected to fund between 15 % and 20 % of total development capital spending on an annual basis from 2022 through 2024.
+Added: percentage in each well spud in that year, which conveyances will not be subject to any reversion.
+Added: Under the terms of the arrangement, QL funded 20 % of development capital for wells spud in 2021, is expected to fund 15 % in 2022 and between 15 % and 20 % of development capital spending for wells spud on an annual basis from 2023 through 2024, which funding amounts represent QL’s proportionate working interest in such wells.
+Added: Additionally, Antero Resources may receive a carry in the form of a one-time payment from QL for each annual tranche if the IRR for such tranche exceeds certain specified returns, which will be determined no earlier than October 31 and no later December 1 following the end of each tranche year .
All of the wells spud during each calendar year period will be a separate annual tranche.
Capital costs in excess of, and cost savings below, a specified percentage of budgeted amounts for each annual tranche will be for Antero Resources’ account.
−Removed: For each tranche other than 2021, Antero Resources will propose a capital budget and estimated internal rate of return (“IRR”) for all wells to be spud during the year and, subject to the mutual agreement of the parties that the estimated IRR for each tranche exceeds a specified return, QL will be obligated to participate in such tranche.
−Removed: For each annual tranche in which QL participates, QL will receive a proportionate working interest percentage in each well spud in such tranche.
−Removed: If Antero Resources presents a capital budget for an annual tranche with an estimated IRR equal to or exceeding a specified return that QL in good faith believes is less than such specified return and QL elects not to participate, Antero Resources will not be obligated to offer QL the opportunity to participate in subsequent tranches.
−Removed: No earlier than December 31 following the expiration of each tranche year, Antero Resources will calculate the tranche IRR for such tranche year and, if the tranche IRR exceeds certain specified returns, Antero Resources will receive a carry in the form of a one-time payment from QL for such annual tranche.
+Added: Subject to the preceding sentence, for any wells included in a tranche, QL is obligated and responsible for its working interest share of costs and liabilities, and is entitled to its working interest share of revenues, associated with such wells for the life of such wells.
+Added: If Antero Resources presents a capital budget for an annual tranche with an estimated IRR equal to or exceeding a specified return that QL in good faith believes is less than such specified return and QL elects not to participate, Antero Resources will not be obligated to offer QL the opportunity to participate in subsequent annual tranches.
+Added: The Company has accounted for the drilling partnership as a conveyance under ASC 932 and such conveyances are recorded in the consolidated financial statements as QL obtains its proportionate working interest in each well.
+Added: No gain or loss was recognized for the interests conveyed during the year ended December 31, 2021.
Disaggregation of Revenue
−Removed: Revenue is disaggregated by type in the following table.
−Removed: The table also identifies which reportable segment that the disaggregated revenues relate.
−Removed: See Note 18—Segment Information to the consolidated financial statements for more information on reportable segments.
+Added: The table set forth below presents revenue disaggregated by type and reportable segment to which it relates (in thousands).
+Added: See Note 18—Reportable Segments to the consolidated financial statements for more information on reportable segments.
Year Ended December 31,
−Removed: (in thousands)
Reportable Segment
8 unchanged sentences
Gathering and compression (1)
−Removed: Equity method investment in Antero Midstream Corporation
+Added: Equity method investment in Antero Midstream
Water handling and treatment (1)
−Removed: Equity method investment in Antero Midstream Corporation
+Added: Equity method investment in Antero Midstream
Total revenue from contracts with customers
−Removed: Income from derivatives, deferred revenue and other sources
+Added: Income (loss) from derivatives, deferred revenue and other sources, net
+Added: ( 1,890,248 )
Total revenue
Gathering and compression and water handling and treatment revenues were included through March 12, 2019.
−Removed: See Note 3—Deconsolidation of Antero Midstream Partners LP to the consolidated financial statements for further discussion on the Transactions.
+Added: See Note 3—Deconsolidation of Antero Midstream Partners to the consolidated financial statements for further discussion on the Simplification Transactions.
Transaction Price Allocated to Remaining Performance Obligations
−Removed: For the Company’s product sales that have a contract term greater than one year, the Company utilized the practical expedient in ASC 606, which does not require the disclosure of the transaction price allocated to remaining performance obligations if the variable consideration is allocated entirely to a wholly unsatisfied performance obligation.
+Added: For the Company’s product sales that have a contract term greater than one year, the Company utilized the practical expedient in ASC 606, Revenue from Contracts with Customers (“ASC 606”), which does not require the disclosure of the transaction price allocated to remaining performance obligations if the variable consideration is allocated entirely to a wholly unsatisfied performance obligation.
Under the Company’s product sales contracts, each unit of product delivered to the customer represents a separate performance obligation;
therefore, future volumes are wholly unsatisfied and disclosure of the transaction price allocated to remaining performance obligations is not required.
−Removed: For the Company’s product sales that have a contract term of one year or less, the Company utilized the practical expedient in ASC 606,
+Added: For the Company’s product sales that have a contract term of one year or less, the Company utilized the practical expedient in ASC 606, which does not require the disclosure of the transaction price allocated to remaining performance obligations if the performance obligation is part of a contract that has an original expected duration of one year
ANTERO RESOURCES CORPORATION
Notes to Consolidated Financial Statements (Continued)
−Removed: which does not require the disclosure of the transaction price allocated to remaining performance obligations if the performance obligation is part of a contract that has an original expected duration of one year or less.
Contract Balances
2 unchanged sentences
As of December 31, 2020 and 2021, the Company’s receivables from contracts with customers were $ 425 million and $ 591 million, respectively.
−Removed: (6) Equity Method Investments
−Removed: (a) Summary of Equity Method Investments
−Removed: As of December 31, 2020, Antero owned approximately 29.2 % of Antero Midstream Corporation’s common stock, which is reflected in Antero’s consolidated financial statements using the equity method of accounting.
−Removed: See Note 3—Deconsolidation of Antero Midstream Partners LP to the consolidated financial statements for further discussion on the Transactions.
−Removed: Prior to March 13, 2019, Antero’s consolidated results included two equity method investments held by Antero Midstream Partners:
−Removed: a 15 % equity interest in Stonewall Gas Gathering LLC (“Stonewall”), which operates a regional gathering pipeline on which the Company is an anchor shipper, and a 50 % interest in the joint venture entered into between Antero Midstream Partners and MarkWest Energy Partners, L.P.
−Removed: (“MarkWest”), a wholly owned subsidiary of MPLX, LP, to develop processing and fractionation assets in Appalachia (the “Joint Venture”).
−Removed: Effective March 13, 2019, the equity in earnings of these investments are accounted for in the equity in earnings (loss) of Antero Midstream Corporation.
−Removed: The following table is a reconciliation of investments in unconsolidated affiliates for the years ended December 31, 2019 and 2020 in thousands):
−Removed: Stonewall (1)
−Removed: Joint Venture
−Removed: Corporation (2)
+Added: (6) Equity Method Investment
+Added: (a) Summary of Equity Method Investment
+Added: As of December 31, 2021, Antero owned approximately 29.1 % of Antero Midstream’s common stock, which is reflected in Antero’s consolidated financial statements using the equity method of accounting.
+Added: The following table sets forth a reconciliation of Antero’s investment in unconsolidated affiliate (in thousands):
Balances as of December 31, 2019
−Removed: Investments (3)
−Removed: Equity in net income (loss) of unconsolidated affiliates
−Removed: Distributions/dividends from unconsolidated affiliates
−Removed: Return of investment (4)
+Added: Equity in loss of unconsolidated affiliate
+Added: Dividends from unconsolidated affiliate
Impairment (1)
Elimination of intercompany profit
−Removed: Effects of deconsolidation (6)
−Removed: Balances as of December 31, 2019
−Removed: Equity in loss of unconsolidated affiliates
−Removed: Distributions/dividends from unconsolidated affiliates
−Removed: Impairment (5)
+Added: Balance as of December 31, 2020 (2)
+Added: Equity in earnings of unconsolidated affiliate
+Added: Dividends from unconsolidated affiliate
Elimination of intercompany profit
−Removed: Balances as of December 31, 2020 (7)
−Removed: (1) Distributions are net of operating and capital requirements retained by Stonewall.
−Removed: (2) As adjusted for the amortization of the difference between the cost of the equity method investment in Antero Midstream Corporation and the amount of underlying equity in the net assets of Antero Midstream Partners as of the date of deconsolidation and as adjusted for the return of investment.
−Removed: (3) Investments in the Joint Venture during the year ended December 31, 2019 relate to capital contributions for construction of additional processing facilities.
−Removed: (4) On December 16, 2019, Antero Midstream Corporation repurchased $ 100 million of its shares of common stock from the Company resulting in a return of investment.
−Removed: The Company recorded an $ 109 million loss on investment due to the carrying value exceeding the fair value of the stock repurchased.
−Removed: (5) Other-than-temporary impairment of the Company’s investment in Antero Midstream Corporation to reduce the carrying value of such investment to fair value, which was based on the quoted market share price of Antero Midstream Corporation as of December 31, 2019 and March 31, 2020, respectively (Level 1).
−Removed: (6) Effective March 13, 2019, the equity in earnings of Stonewall and the Joint Venture are accounted for in the equity in earnings of Antero Midstream Corporation.
−Removed: ANTERO RESOURCES CORPORATION
−Removed: Notes to Consolidated Financial Statements (Continued)
−Removed: (7) The Company’s investment in Antero Midstream Corporation as of December 31, 2020, based on the quoted market share price of Antero Midstream Corporation on such date, was $ 1.1 billion.
−Removed: (b) Summarized Financial Information of Antero Midstream Corporation
−Removed: The following tables present summarized financial information of Antero Midstream Corporation.
+Added: Balance as of December 31, 2021 (2)
+Added: (1) Other-than-temporary impairment of the Company’s investment in Antero Midstream to reduce the carrying value of such investment to fair value, which was based on the quoted market share price of Antero Midstream as of March 31, 2020 (Level 1).
+Added: (2) The fair value of the Company’s investment in Antero Midstream as of December 31, 2020 and 2021 was $ 1.1 billion and $ 1.3 billion, respectively, based on the quoted market share price of Antero Midstream.
+Added: (b) Summarized Financial Information of Antero Midstream
+Added: The tables set forth below present summarized financial information of Antero Midstream (in thousands).
Balance Sheet
−Removed: (in thousands)
Current assets
4 unchanged sentences
Total liabilities and stockholders' equity
+Added: ANTERO RESOURCES CORPORATION
+Added: Notes to Consolidated Financial Statements (Continued)
Statement of Operations
−Removed: For the period
−Removed: March 13, 2019
−Removed: (in thousands)
−Removed: December 31, 2019
−Removed: December 31, 2020
+Added: Year Ended December 31,
Operating expenses
−Removed: Loss from operations
−Removed: Loss attributable to the equity method investment
+Added: Income (loss) from operations
+Added: Net income (loss)
(7) Accrued Liabilities
−Removed: Accrued liabilities as of December 31, 2019 and 2020 consisted of the following items (in thousands):
+Added: Accrued liabilities consisted of the following items (in thousands):
Capital expenditures
2 unchanged sentences
Interest expense, net
−Removed: Accrued taxes
+Added: Accrued production and ad valorem taxes
+Added: Derivative settlements payable
+Added: Accrued general and administrative expense
Total accrued liabilities
−Removed: ANTERO RESOURCES CORPORATION
−Removed: Notes to Consolidated Financial Statements (Continued)
(8) Long-Term Debt
−Removed: Long-term debt as of December 31, 2019 and 2020 consisted of the following items (in thousands):
+Added: Long-term debt consisted of the following items (in thousands):
Credit Facility (a)
3 unchanged sentences
8.375 % senior notes due 2026 (e)
−Removed: 4.25 % convertible senior notes due 2026 (f)
+Added: 7.625 % senior notes due 2029 (f)
+Added: 5.375 % senior notes due 2030 (g)
+Added: 4.25 % convertible senior notes due 2026 (h)
Total principal
−Removed: Unamortized premium (discount), net
+Added: Unamortized discount, net
Unamortized debt issuance costs
1 unchanged sentence
Senior Secured Revolving Credit Facility
−Removed: Antero Resources has a senior secured revolving credit facility (the “Credit Facility”) with a consortium of bank lenders.
+Added: Antero Resources has a senior secured revolving credit facility with a consortium of bank lenders.
+Added: On October 26, 2021, Antero Resources entered into an amended and restated senior secured revolving credit facility, the New Credit Facility.
Borrowings under the Credit Facility are subject to borrowing base limitations based on the collateral value of Antero Resources’ assets and are subject to regular semi-annual redeterminations.
−Removed: The borrowing base and lender commitments were each reaffirmed in the semi-annual redetermination in October 2020.
+Added: As of December 31, 2021, the borrowing base under the New Credit Facility was $ 3.5 billion and lender commitments were $ 1.5 billion.
The next redetermination of the borrowing base is scheduled to occur in April 2022.
−Removed: The Credit Facility is scheduled to mature on October 26, 2022.
−Removed: As of December 31, 2020, the borrowing base under the Credit Facility was $ 2.85 billion and lender commitments were $ 2.64 billion.
−Removed: Antero Resources was in compliance with all of the financial covenants under the Credit Facility as of December 31, 2019 and 2020.
+Added: The maturity date of the Credit Facility is the earlier of (i) October 26, 2026 and (ii) the date that is 180 days prior to the earliest stated redemption date of any series of the Company’s then outstanding senior notes .
+Added: The Credit Facility contains requirements with respect to leverage and current ratios, and certain covenants, including
+Added: ANTERO RESOURCES CORPORATION
+Added: Notes to Consolidated Financial Statements (Continued)
+Added: restrictions on our ability to incur debt and limitations on our ability to pay dividends unless certain customary conditions are met, in each case, subject to customary carve-outs and exceptions.
+Added: Antero Resources was in compliance with all of the financial covenants under the Prior Credit Facility as of December 31, 2020 and New Credit Facility as of December 31, 2021.
+Added: The Prior Credit Facility provides for borrowing under either an Alternate Base Rate or as a Eurodollar Loan (as each term is defined in the Prior Credit Facility), and the New Credit Facility provides for borrowing at either an Adjusted Term Secured Overnight Financing Rate (“SOFR”), an Adjusted Daily Simple SOFR or an Alternate Base Rate (each as defined in the New Credit Facility).
+Added: The Credit Facility provides for interest only payments until maturity at which time all outstanding borrowings are due.
+Added: Interest is payable at a variable rate based on (i) LIBOR or the Alternate Base Rate, determined by Antero Resources’ election at the time of borrowing, plus an applicable margin rate under the Prior Credit Facility and (ii) SOFR or the Alternate Base Rate, determined by Antero Resources’ election at the time of borrowing, plus an applicable margin rate under the New Credit Facility.
+Added: Interest at the time of borrowing is determined with reference to the Antero Resources’ then-current leverage ratio subject to certain exceptions.
+Added: Commitment fees on the unused portion of the Credit Facility are due quarterly at rates ranging from (i) 0.300 % to 0.375 % with respect to the Prior Credit Facility, determined with reference to borrowing base utilization and (ii) 0.375 % to 0.500 % with respect to the New Credit Facility, determined with reference to borrowing base utilization, both rates subject to certain exceptions based on the leverage ratio then in effect.
+Added: The New Credit Facility includes fall away covenants, lower interest rates and reduced collateral requirements that Antero Resources may elect if Antero Resources is assigned an Investment Grade Rating (as defined in the New Credit Facility).
+Added: As of December 31, 2021, Antero Resources had no borrowings under the New Credit Facility and outstanding letters of credit of $ 531 million.
As of December 31, 2020, Antero Resources had an outstanding balance under the Credit Facility of $ 1.0 billion, with a weighted average interest rate of 3.26 %, and outstanding letters of credit of $ 730 million.
−Removed: As of December 31, 2019, Antero Resources had an outstanding balance under the Credit Facility of $ 552 million, with a weighted average interest rate of 3.28 %, and outstanding letters of credit of $ 623 million.
−Removed: Commitment fees on the unused portion of the Credit Facility are due quarterly at rates ranging from (i) 0.300 % to 0.375 % (subject to certain exceptions) of the unused portion based on utilization.
5.125 % Senior Notes Due 2022
−Removed: On November 5, 2013, Antero Resources issued $ 1.0 billion of 5.375 % senior notes due November 1, 2021 (the “2021 Notes”) at par .
−Removed: The 2021 Notes were unsecured and effectively subordinated to the Credit Facility to the extent of the value of the collateral securing the Credit Facility.
−Removed: The 2021 Notes ranked pari passu to Antero Resources’ other outstanding senior notes.
−Removed: The 2021 Notes were guaranteed on a full and unconditional and joint and several senior unsecured basis by Antero Resources’ wholly owned subsidiaries and certain of its future restricted subsidiaries.
−Removed: Interest on the 2021 Notes was payable on May 1 and November 1 of each year.
−Removed: The Company repurchased or otherwise redeemed all of the 2021 Notes from time to time during the years ended December 31, 2019 and 2020.
−Removed: See —Debt Repurchase Program below for further details on 2021 Notes repurchases.
−Removed: 5.125 % Senior Notes Due 2022
On May 6, 2014, Antero Resources issued $ 600 million of 5.125 % senior notes due December 1, 2022 (the “2022 Notes”) at par .
On September 18, 2014, Antero Resources issued an additional $ 500 million of the 2022 Notes at 100.5 % of par.
+Added: The Company repurchased or otherwise fully redeemed all of the 2022 Notes between 2019 and the first quarter of 2021.
+Added: Interest on the 2022 Notes was payable on June 1 and December 1 of each year.
+Added: See “—Debt Repurchase Program” below for further details on 2022 Notes repurchases.
+Added: 5.625 % Senior Notes Due 2023
+Added: On March 17, 2015, Antero Resources issued $ 750 million of 5.625 % senior notes due June 1, 2023 (the “2023 Notes”) at par .
+Added: The Company repurchased or otherwise fully redeemed all of the 2023 Notes between 2020 and the second quarter of 2021.
+Added: Interest on the 2023 Notes was payable on June 1 and December 1 of each year.
+Added: See “—Debt Repurchase Program” below for further details on 2023 Notes repurchases and redemption.
+Added: 5.00 % Senior Notes Due 2025
+Added: On December 21, 2016, Antero Resources issued $ 600 million of 5.00 % senior notes due March 1, 2025 (the “2025 Notes”) at par .
+Added: The Company repurchased $ 15 million of the 2025 Notes from time to time during 2020 and 2021, and as of December 31, 2021, $ 585 million principal amount of the 2025 Notes remained outstanding.
The 2025 Notes are unsecured and effectively subordinated to the Credit Facility to the extent of the value of the collateral securing the Credit Facility.
The 2025 Notes rank pari passu to Antero Resources’ other outstanding senior notes.
−Removed: The 2022 Notes are guaranteed on a full and unconditional and joint and several senior unsecured basis by Antero Resources’ wholly owned subsidiaries and certain of its future restricted subsidiaries.
−Removed: Interest on the 2022 Notes is payable on June 1 and December 1 of each year.
−Removed: Antero Resources may redeem all or part of the 2022 Notes at a redemption price of 100.00 %.
+Added: The 2025 Notes are guaranteed on a full and unconditional and joint and several senior unsecured basis by Antero Resources’ existing subsidiaries that guarantee the Credit Facility and certain of its future restricted subsidiaries.
+Added: Interest on the 2025 Notes is payable on March 1 and September 1 of each year.
+Added: Antero Resources may redeem all or part of the 2025 Notes at any time at redemption prices ranging from 102.5 % currently to 100.00 % on or after March 1, 2023, which option the Company exercised on January 27, 2022 with its notice to redeem all remaining 2025 Notes on March 1, 2022.
+Added: See “—Subsequent Event” below for further details on the 2025 Notes redemption.
If Antero Resources undergoes a change of control followed by a rating decline, the holders of the 2025 Notes will have the right to require Antero Resources to repurchase all or a portion of the notes at a price equal to 101 % of the principal amount of the 2025 Notes, plus accrued and unpaid interest.
+Added: 8.375 % Senior Notes Due 2026
+Added: On January 4, 2021, Antero Resources issued $ 500 million of 8.375 % senior notes due July 15, 2026 (the “2026 Notes”) at par .
+Added: The Company redeemed $ 175 million of the 2026 Notes on July 1, 2021, and as of December 31, 2021, $ 325 million principal
ANTERO RESOURCES CORPORATION
Notes to Consolidated Financial Statements (Continued)
+Added: amount of the 2026 Notes remained outstanding.
+Added: See “—Debt Repurchase Program” below for further details on the 2026 Notes redemption.
+Added: The 2026 Notes are unsecured and effectively subordinated to the Credit Facility to the extent of the value of the collateral securing the Credit Facility.
+Added: The 2026 Notes rank pari passu to Antero Resources’ other outstanding senior notes.
+Added: The 2026 Notes are guaranteed on a full and unconditional and joint and several senior unsecured basis by Antero Resources’ existing subsidiaries that guarantee the Credit Facility and certain of its future restricted subsidiaries.
+Added: Interest on the 2026 Notes is payable on January 15 and July 15 of each year.
+Added: Antero Resources may redeem all or part of the 2026 Notes at any time on or after January 15, 2024 at redemption prices ranging from 104.188 % on or after January 15, 2024 to 100.00 % on or after January 15, 2026.
+Added: At any time prior to January 15, 2024, Antero Resources may also redeem the 2026 Notes, in whole or in part, at a price equal to 100 % of the principal amount of the 2026 Notes plus a “make-whole” premium and accrued and unpaid interest.
+Added: If Antero Resources undergoes a change of control followed by a rating decline, the holders of the 2026 Notes will have the right to require Antero Resources to repurchase all or a portion of the notes at a price equal to 101 % of the principal amount of the 2026 Notes, plus accrued and unpaid interest.
7.625 % Senior Notes Due 2029
−Removed: On March 17, 2015, Antero Resources issued $ 750 million of 5.625 % senior notes due June 1, 2023 (the “2023 Notes”) at par .
+Added: On January 26, 2021, Antero Resources issued $ 700 million of 7.625 % senior notes due February 1, 2029 (the “2029 Notes”) at par.
+Added: The Company redeemed $ 116 million of the 2029 Notes on November 2, 2021, and as of December 31, 2021, $ 584 million principal amount of the 2029 Notes remained outstanding.
+Added: See “—Debt Repurchase Program” below for further details on the 2029 Notes redemption.
The 2029 Notes are unsecured and effectively subordinated to the Credit Facility to the extent of the value of the collateral securing the Credit Facility.
The 2029 Notes rank pari passu to Antero Resources’ other outstanding senior notes.
−Removed: The 2023 Notes are guaranteed on a full and unconditional and joint and several senior unsecured basis by Antero Resources’ wholly owned subsidiaries and certain of its future restricted subsidiaries.
−Removed: Interest on the 2023 Notes is payable on June 1 and December 1 of each year.
−Removed: Antero Resources may redeem all or part of the 2023 Notes at any time at redemption prices ranging from 101.406 % to 100.00 % on or after June 1, 2021.
+Added: The 2029 Notes are guaranteed on a full and unconditional and joint and several senior unsecured basis by Antero Resources’ existing subsidiaries that guarantee the Credit Facility and certain of its future restricted subsidiaries.
+Added: Interest on the 2029 Notes is payable on February 1 and August 1 of each year.
+Added: Antero Resources may redeem all or part of the 2029 Notes at any time on or after February 1, 2024 at redemption prices ranging from 103.813 % on or after February 1, 2024 to 100.00 % on or after February 1, 2027.
+Added: In addition, on or before February 1, 2024, Antero Resources may redeem up to 35 % of the aggregate principal amount of the 2029 Notes, but in an amount not greater than the net cash proceeds of certain equity offerings, if certain conditions are met, at a redemption price of 107.625 % of the principal amount of the 2029 Notes, plus accrued and unpaid interest, which option the Company partially exercised on October 18, 2021 with its notice to redeem $ 116 million aggregate principal amount of outstanding 2029 Notes.
+Added: At any time prior to February 1, 2024, Antero Resources may also redeem the 2029 Notes, in whole or in part, at a price equal to 100 % of the principal amount of the 2029 Notes plus a “make-whole” premium and accrued and unpaid interest.
If Antero Resources undergoes a change of control followed by a rating decline, the holders of the 2029 Notes will have the right to require Antero Resources to repurchase all or a portion of the notes at a price equal to 101 % of the principal amount of the 2029 Notes, plus accrued and unpaid interest.
5.375 % Senior Notes Due 2030
−Removed: On December 21, 2016, Antero Resources issued $ 600 million of 5.00 % senior notes due March 1, 2025 (the “2025 Notes”) at par .
+Added: On June 1, 2021, Antero Resources issued $ 600 million of 5.375 % senior notes due March 1, 2030 (the “2030 Notes”) at par.
The 2030 Notes are unsecured and effectively subordinated to the Credit Facility to the extent of the value of the collateral securing the Credit Facility.
The 2030 Notes rank pari passu to Antero Resources’ other outstanding senior notes.
−Removed: The 2025 Notes are guaranteed on a full and unconditional and joint and several senior unsecured basis by Antero Resources’ wholly owned subsidiaries and certain of its future restricted subsidiaries.
+Added: The 2030 Notes are guaranteed on a full and unconditional and joint and several senior unsecured basis by Antero Resources’ existing subsidiaries that guarantee the Credit Facility and certain of its future restricted subsidiaries.
Interest on the 2030 Notes is payable on March 1 and September 1 of each year.
Antero Resources may redeem all or part of the 2030 Notes at any time on or after March 1, 2025 at redemption prices ranging from 102.688 % on or after March 1, 2025 to 100.00 % on or after March 1, 2028.
−Removed: In addition, on or before March 1, 2020, Antero Resources may redeem up to 35 % of the aggregate principal amount of the 2025 Notes with the net cash proceeds of certain equity offerings, if certain conditions are met, at a redemption price of 105.00 % of the principal amount of the 2025 Notes, plus accrued and unpaid interest.
+Added: In addition, on or before March 1, 2025, Antero Resources may redeem up to 35 % of the aggregate principal amount of the 2030 Notes, but in an amount not greater than the net cash proceeds of certain equity offerings, if certain conditions are met, at a redemption price of 105.375 % of the principal amount of the 2030 Notes, plus accrued and unpaid interest.
At any time prior to March 1, 2025, Antero Resources may also redeem the 2030 Notes, in whole or in part, at a price equal to 100 % of the principal amount of the 2030 Notes plus a “make-whole” premium and accrued and unpaid interest.
1 unchanged sentence
4.25 % Convertible Senior Notes Due 2026
−Removed: On August 21, 2020, Antero Resources issued $ 250 million in aggregate principal amount of 4.25 % senior unsecured convertible notes (the “2026 Convertible Notes”).
−Removed: On September 2, 2020, Antero Resources issued an additional $ 37.5 million aggregate principal amount of 2026 Convertible Notes pursuant to the partial exercise of the initial purchasers’ option to purchase additional 2026 Convertible Notes.
+Added: On August 21, 2020, Antero Resources issued $ 250 million in aggregate principal amount of 4.25 % convertible senior notes due September 1, 2026 (the “2026 Convertible Notes”).
+Added: On September 2, 2020, Antero Resources issued an additional $ 37.5 million of the 2026 Convertible Notes.
+Added: During the year ended December 31, 2021, the Company completed the equitization transactions described below under “—Partial Equitizations of 2026 Convertible Notes,” that extinguished $ 206 million principal amount of the
+Added: ANTERO RESOURCES CORPORATION
+Added: Notes to Consolidated Financial Statements (Continued)
+Added: 2026 Convertible Notes, and as of December 31, 2021, $ 82 million principal amount of the 2026 Convertible Notes remained outstanding.
The 2026 Convertible Notes were issued pursuant to an indenture and are senior, unsecured obligations of Antero Resources.
1 unchanged sentence
Proceeds from the issuance of the 2026 Convertible Notes totaled $ 278.5 million, net of initial purchasers’ fees and issuance cost of $ 9 million.
−Removed: Each capitalized term used in this subsection but not otherwise defined in this Annual on Form 10-K has the meaning as set forth in the indenture governing the 2026 Convertible Notes.
+Added: Each capitalized term used in this subsection but not otherwise defined in this Annual Report on Form 10-K has the meaning as set forth in the indenture governing the 2026 Convertible Notes.
The initial conversion rate is 230.2026 shares of Antero Resources’ common stock per $1,000 principal amount of 2026 Convertible Notes, subject to adjustment upon the occurrence of specified events.
2 unchanged sentences
Before May 1, 2026, note holders will have the right to convert their 2026 Convertible Notes only upon the occurrence of the following events:
−Removed: ● during any calendar quarter (and only during such calendar quarter) commencing after the calendar quarter ending on September 30, 2020, if the Last Reported Sale Price per share of Antero Resources’ common stock exceeds 130 % of the Conversion Price for each of at least 20 Trading Days (whether or not consecutive) during the 30 consecutive Trading Days ending on, and including, the last Trading Day of the immediately preceding calendar quarter;
+Added: ● during any calendar quarter (and only during such calendar quarter) commencing after the calendar quarter ending on September 30, 2020, if the Last Reported Sale Price per share of Antero Resources’ common stock exceeds 130 % of the Conversion Price for each of at least 20 Trading Days (whether or not consecutive) during the 30 consecutive Trading Days ending on, and including, the last Trading Day of the immediately preceding calendar quarter (the “Stock Price Condition”) ;
● during the five consecutive Business Days immediately after any 10 consecutive trading day period (such 10 consecutive Trading Day period, the “Measurement Period”) if the trading Price per $1,000 principal amount of 2026 Convertible Notes, as determined following a request by a noteholder in accordance with the procedures set forth below, for each trading day of the Measurement Period was less than 98 % of the product of the last reported sale price per share of common stock on such trading day and the conversion rate on such trading day;
−Removed: ANTERO RESOURCES CORPORATION
−Removed: Notes to Consolidated Financial Statements (Continued)
● if Antero Resources calls any or all of the 2026 Convertible Notes for redemption, at any time prior to the close of business on the scheduled trading day immediately preceding the redemption date;
2 unchanged sentences
Upon conversion, Antero Resources may satisfy its conversion obligation by paying and/or delivering, as the case may be, cash, shares of Antero Resources’ common stock or a combination of cash and shares of Antero Resources’ common stock, at Antero Resources’ election, in the manner and subject to the terms and conditions provided in the indenture governing the 2026 Convertible Notes.
−Removed: Antero Resources’ current intent is is to settle the principle amount of the 2026 Convertible Notes in cash upon conversion except as it relates to the Equitization Transactions discussed in Note 8(h) below.
−Removed: At no point since issuance of the 2026 Convertible Notes has the conditions allowing holders of the 2026 Convertible Notes to exercise their conversion right been met.
+Added: The 2026 Convertible Notes have met the Stock Price Condition allowing holders of the 2026 Convertible Notes to exercise their conversion right as of December 31, 2021.
The conversion rate is subject to adjustment under certain circumstances in accordance with the terms of the indenture governing the 2026 Convertible Notes.
5 unchanged sentences
The difference between the principal amount of the 2026 Convertible Notes and the estimated fair value of the liability component was recorded as a debt discount and will be amortized to interest expense, together with debt issuance costs, over the term of the 2026 Convertible Notes using the effective interest method, with an effective interest rate of 15.1 % per annum.
−Removed: As of the issuance date, the fair value of the 2026 Convertible Notes was estimated at $ 172 million, resulting in a debt discount at inception of $ 116 million.
+Added: ANTERO RESOURCES CORPORATION
+Added: Notes to Consolidated Financial Statements (Continued)
+Added: issuance date, the fair value of the 2026 Convertible Notes was estimated at $ 172 million, resulting in a debt discount at inception of $ 116 million.
The equity component, representing the value of the conversion option, was computed by deducting the fair value of the liability component from the initial proceeds of the 2026 Convertible Notes issuance.
3 unchanged sentences
Issuance costs attributable to the equity component were recorded as a charge to additional paid-in capital within the consolidated balance sheet and statement of stockholders’ equity.
−Removed: The 2026 Convertible Notes consist of the following as of December 31, 2020 (in thousands):
+Added: Partial Equitizations of 2026 Convertible Notes
+Added: On January 12, 2021, the Company completed a registered direct offering (the “January Share Offering”) of an aggregate of 31.4 million shares of its common stock at a price of $ 6.35 per share to certain holders of the 2026 Convertible Notes.
+Added: The Company used the proceeds from the January Share Offering and approximately $ 63 million of borrowings under the Credit Facility to repurchase from such holders $ 150 million aggregate principal amount of the 2026 Convertible Notes in privately negotiated transactions (the “January Convertible Note Repurchase,” and, collectively with the January Share Offering, the “January Equitization Transactions”).
+Added: The 2026 Convertible Notes have an initial conversion rate of 230.2026 shares of the Company’s common stock per $1,000 principal amount, and the January Equitization Transactions had the effect of increasing this conversion rate to 275.3525 shares of common stock per $1,000 principal amount.
+Added: The Company accounted for this transaction as an inducement of the 2026 Convertible Notes, and as a result, the Company recorded a $ 39 million loss on convertible note equitization in the consolidated statements of operations and comprehensive loss for the year ended December 31, 2021 for the consideration paid in excess of the original terms of the 2026 Convertible Notes.
+Added: Additionally, the January Equitization Transactions resulted in a loss on early extinguishment of debt of $ 41 million in the consolidated statement of operations and comprehensive loss for the year ended December 31, 2021.
+Added: On May 13, 2021, the Company completed a registered direct offering (the “May Share Offering”) of an aggregate of 11.6 million shares of its common stock at a price of $ 11.01 per share to certain holders of the 2026 Convertible Notes.
+Added: The Company used the proceeds from the May Share Offering and approximately $ 26 million of borrowings under the Credit Facility to repurchase from such holders $ 56 million aggregate principal amount of the 2026 Convertible Notes in privately negotiated transactions (the “May Convertible Note Repurchase,” and, collectively with the May Share Offering, the “May Equitization Transactions”).
+Added: The 2026 Convertible Notes have an initial conversion rate of 230.2026 shares of the Company’s common stock per $1,000 principal amount, and the May Equitization Transactions had the effect of increasing this conversion rate to 245.2802 shares of common stock per $1,000 principal amount.
+Added: The Company accounted for this transaction as an inducement of the 2026 Convertible Notes, and as a result, the Company recorded a $ 12 million loss on convertible note equitization in the consolidated statements of operations and comprehensive loss for the year ended December 31, 2021 for the consideration paid in excess of the original terms of the 2026 Convertible Notes.
+Added: Additionally, the May Equitization Transactions resulted in a loss on early extinguishment of debt of $ 21 million in the consolidated statement of operations and comprehensive loss for the year ended December 31, 2021.
+Added: The 2026 Convertible Notes consist of the following (in thousands):
Liability component:
3 unchanged sentences
Equity component (1)
+Added: (1) As of December 31, 2020, the equity component attributable to the outstanding 2026 Convertible Notes was recorded in additional paid-in capital, net of $ 3 million of issuance costs and $ 28 million of deferred taxes.
+Added: As of December 31, 2021, the equity component attributable to the outstanding 2026 Convertible Notes was recorded in additional paid-in capital net of $ 1 million of issuance costs and $ 8 million of deferred taxes.
+Added: Interest expense recognized on the 2026 Convertible Notes related to the stated interest rate, amortization of the debt discount
ANTERO RESOURCES CORPORATION
Notes to Consolidated Financial Statements (Continued)
−Removed: (1) Recorded in additional paid-in capital, net of $ 3 million of issuance costs and $ 28 million of deferred taxes .
+Added: and debt issuance costs totaled $ 8 million and $ 11 million for the years ended December 31, 2020 and 2021, respectively.
Debt Repurchase Program
−Removed: During the year ended December 31, 2019, Antero Resources repurchased $ 225 million principal amount of debt at a 17 % weighted average discount, including a portion of its 2021 Notes and 2022 Notes.
−Removed: The Company recognized a gain of approximately $ 36 million on the early extinguishment of the debt repurchased.
During the year ended December 31, 2020, Antero Resources repurchased $ 1.4 billion aggregate principal amount of debt at a weighted average discount of 13 % , which purchases included a portion of the 2021 Notes, 2022 Notes, 2023 Notes and 2025 Notes.
1 unchanged sentence
Repurchases of the principal amount of debt during year ended December 31, 2020 include repurchases of $ 367 million aggregate principal amount of the 2021 Notes, 2022 Notes and 2023 Notes through previously disclosed tender offers at a weighted average discount of 10 %.
−Removed: Subsequent Events
−Removed: Issuance of 8.375 % Senior Notes Due 2026
−Removed: On January 4, 2021, Antero Resources issued $ 500 million of 8.375 % senior notes due July 15, 2026 (the “2026 Notes”) at par .
−Removed: The 2026 Notes are unsecured and effectively subordinated to the Credit Facility to the extent of the value of the collateral securing the Credit Facility.
−Removed: The 2026 Notes rank pari passu to Antero Resources’ other outstanding senior notes.
−Removed: The 2026 Notes are guaranteed on a full and unconditional and joint and several senior unsecured basis by Antero Resources’ wholly owned subsidiaries and certain of its future restricted subsidiaries.
−Removed: Interest on the 2026 Notes is payable on January 15 and July 15 of each year.
−Removed: Antero Resources may redeem all or part of the 2026 Notes at any time on or after January 15, 2024 at redemption prices ranging from 104.188 % on or after January 15, 2024 to 100.00 % on or after January 15, 2026.
−Removed: In addition, on or before January 15, 2024, Antero Resources may redeem up to 35 % of the aggregate principal amount of the 2026 Notes with the net cash proceeds of certain equity offerings, if certain conditions are met, at a redemption price of 108.375 % of the principal amount of the 2026 Notes, plus accrued and unpaid interest.
−Removed: At any time prior to January 15, 2024, Antero Resources may also redeem the 2026 Notes, in whole or in part, at a price equal to 100 % of the principal amount of the 2026 Notes plus a “make-whole” premium and accrued and unpaid interest.
−Removed: If Antero Resources undergoes a change of control followed by a rating decline, the holders of the 2026 Notes will have the right to require Antero Resources to repurchase all or a portion of the notes at a price equal to 101 % of the principal amount of the 2026 Notes, plus accrued and unpaid interest.
−Removed: Partial Equitization of 2026 Convertible Notes
−Removed: On January 12, 2021, the Company completed a registered direct offering (the “Share Offering”) of an aggregate of 31.4 million shares of its common stock at a price of $ 6.35 per share to certain holders of the 2026 Convertible Notes.
−Removed: The Company used the proceeds from the Share Offering and approximately $ 63 million of borrowings under the Credit Facility to repurchase from such holders $ 150 million aggregate principal amount of the 2026 Convertible Notes in privately negotiated transactions (the “Convertible Note Repurchase,” and, collectively with the Share Offering, the “Equitization Transactions”).
−Removed: The 2026 Convertible Notes have an initial conversion rate of 230.2026 shares of the Company’s common stock per $1,000 principal amount, and the Equitization Transactions had the effect of increasing this conversion rate to 275.3525 shares of common stock per $1,000 principal amount.
−Removed: Redemption of 2022 Notes
−Removed: On January 16, 2021, the Company completed a partial redemption of $ 350 million of the 2022 Notes at par, plus accrued and unpaid interest.
−Removed: On February 10, 2021, the Company redeemed $ 311 million of 2022 Notes that remained outstanding at par, plus accrued and unpaid interest, and as a result, the 2022 Notes were fully retired as of February 10, 2021.
−Removed: Issuance of 7.625 % Senior Notes Due 2029
−Removed: On January 26, 2021, Antero Resources issued $ 700 million of 7.625 % senior notes due February 1, 2029 (the “2029 Notes”) at par .
−Removed: The 2029 Notes are unsecured and effectively subordinated to the Credit Facility to the extent of the value of the collateral securing the Credit Facility.
−Removed: The 2029 Notes rank pari passu to Antero Resources’ other outstanding senior notes.
−Removed: The 2029 Notes are guaranteed on a full and unconditional and joint and several senior unsecured basis by Antero Resources’ wholly owned subsidiaries and certain of its future restricted subsidiaries.
−Removed: Interest on the 2029 Notes is payable on February 1 and August 1 of each year.
−Removed: ANTERO RESOURCES CORPORATION
−Removed: Notes to Consolidated Financial Statements (Continued)
−Removed: Resources may redeem all or part of the 2029 Notes at any time on or after February 1, 2024 at redemption prices ranging from 103.813 % on or after February 1, 2024 to 100.00 % on or after February 1, 2027.
−Removed: In addition, on or before February 1, 2024, Antero Resources may redeem up to 35 % of the aggregate principal amount of the 2029 Notes with the net cash proceeds of certain equity offerings, if certain conditions are met, at a redemption price of 107.625 % of the principal amount of the 2029 Notes, plus accrued and unpaid interest.
−Removed: At any time prior to February 1, 2024, Antero Resources may also redeem the 2029 Notes, in whole or in part, at a price equal to 100 % of the principal amount of the 2029 Notes plus a “make-whole” premium and accrued and unpaid interest.
−Removed: If Antero Resources undergoes a change of control followed by a rating decline, the holders of the 2029 Notes will have the right to require Antero Resources to repurchase all or a portion of the notes at a price equal to 101 % of the principal amount of the 2029 Notes, plus accrued and unpaid interest.
+Added: During the first quarter of 2021, the Company redeemed the remaining $ 661 million of the 2022 Notes at par, plus accrued and unpaid interest, and as a result, the 2022 Notes were fully retired as of February 10, 2021.
+Added: The Company redeemed the remaining $ 574 million of the 2023 Notes at par, plus accrued and unpaid interest, during the second quarter of 2021.
+Added: The 2023 Notes were fully retired as of June 1, 2021.
+Added: During the third quarter of 2021, the Company redeemed $ 175 million of the principal amount of its 2026 Notes at a redemption price of 108.375 % of the principal amount thereof, plus accrued and unpaid interest, and recognized a loss on early debt extinguishment of $ 17 million.
+Added: During the fourth quarter of 2021, the Company redeemed $ 116 million of the principal amount of its 2029 Notes at a redemption price of 107.625 % of the principal amount thereof, plus accrued and unpaid interest, and recognized a loss on early debt extinguishment of $ 10 million.
+Added: Subsequent Event
+Added: On January 27, 2022, Antero Resources announced that it will redeem all $ 585 million in aggregate principal amount of its 2025 Notes at a redemption price of 101.25 % of the principal amount thereof, plus accrued and unpaid interest on March 1, 2022.
+Added: Immediately following the redemption, the 2025 Notes will be fully retired.
+Added: The $ 7 million premium to the principal amount to be redeemed along with the write-off of unamortized debt issuance costs will be included in our loss on early debt extinguishment during the first quarter of 2022.
(9) Asset Retirement Obligations
−Removed: The following is a reconciliation of the Company’s asset retirement obligations for the years ended December 31, 2019 and 2020 (in thousands):
−Removed: Beginning balances
+Added: The following table presents a reconciliation of the Company’s asset retirement obligations (in thousands):
+Added: Beginning balance
Obligations incurred
2 unchanged sentences
Revisions to prior estimates
−Removed: Effect of deconsolidation of Antero Midstream Partners LP (1)
−Removed: Ending balances
−Removed: (1) Effective March 13, 2019, Antero no longer consolidates Antero Midstream Partners in its results.
−Removed: Revisions to prior estimates in 2020 are primarily due to an increase in estimated well lives.
−Removed: Revisions to prior estimates in 2019 are primarily due to an increase in estimated abandonment costs for vertical wells.
+Added: Ending balance
+Added: Revisions to prior estimates in 2020 and 2021 are primarily due to an increase in estimated well lives.
Asset retirement obligations are included in other liabilities on the Company’s consolidated balance sheets.
−Removed: (10) Equity-Based Compensation and Retention Awards
+Added: (10) Equity-Based Compensation and Cash Awards
On June 17, 2020, Antero Resources’ stockholders approved the Antero Resources Corporation 2020 Long-Term Incentive Plan (the “2020 Plan”), which replaced the Antero Resources Corporation Long-Term Incentive Plan (the “2013 Plan”), and the 2020 Plan became effective as of such date.
4 unchanged sentences
The 2020 Plan provides for the reservation of 10,050,000 shares of the Company’s common stock, plus the number of certain shares that become available again for delivery from the 2013 Plan in accordance with the share recycling provisions described below.
−Removed: The share recycling provisions allow for all or any portion of an award (including an award granted under the 2013 Plan that was outstanding as of June 17, 2020) that expires or is cancelled, forfeited, exchanged, settled for cash, or otherwise terminated without actual delivery of the shares to be considered not delivered and thus available for new awards under the 2020 Plan.
+Added: The share recycling provisions allow for all or any portion of an award (including an award granted under the 2013 Plan that was
+Added: ANTERO RESOURCES CORPORATION
+Added: Notes to Consolidated Financial Statements (Continued)
+Added: outstanding as of June 17, 2020) that expires or is cancelled, forfeited, exchanged, settled for cash, or otherwise terminated without actual delivery of the shares to be considered not delivered and thus available for new awards under the 2020 Plan.
Further, any shares withheld or surrendered in payment of any taxes relating to awards that were outstanding under either the 2013 Plan as of June 17, 2020 or are granted under the 2020 Plan (other than stock options and stock appreciation rights), will again be available for new awards under the 2020 Plan.
1 unchanged sentence
Antero Midstream Partners’ general partner was authorized to grant up to 10,000,000 common units representing limited partner interests in Antero Midstream Partners under the Antero Midstream Partners LP Long-Term Incentive Plan (the “AMP Plan”) to non-employee directors of its general partner and certain officers, employees, and consultants of Antero Midstream Partners and its affiliates (which includes Antero Resources).
−Removed: As part of the Transactions, each outstanding phantom unit award under the AMP Plan, was assumed by Antero Midstream Corporation and converted into 1.8926 RSUs under the Antero Midstream Corporation Long Term
−Removed: ANTERO RESOURCES CORPORATION
−Removed: Notes to Consolidated Financial Statements (Continued)
−Removed: Incentive Plan (the “AMC Plan”).
−Removed: Each RSU award under the AMC Plan represents a right to receive one share of Antero Midstream Corporation common stock.
−Removed: The Company’s equity-based compensation expense, by type of award, was as follows for the years ended December 31, 2018, 2019 and 2020 (in thousands):
+Added: As part of the Simplification Transactions, each outstanding phantom unit award under the AMP Plan, was assumed by Antero Midstream and converted into 1.8926 RSUs (all such RSUs, the “Converted AM RSU Awards”) under the Antero Midstream Corporation Long Term Incentive Plan (the “AM Plan”).
+Added: Each RSU award under the AM Plan represents a right to receive one share of Antero Midstream common stock.
+Added: The Company’s equity-based compensation expense, by type of award, is as follows (in thousands):
Year Ended December 31,
+Added: Converted AM RSU Awards (1)
Stock options
−Removed: Antero Midstream Partners phantom unit awards (1)
Equity awards issued to directors
Total expense
−Removed: (1) Antero Resources recognized compensation expense for equity awards granted under the 2013 Plan, 2020 Plan and the AMP Plan because the awards under the AMP Plan are accounted for as if they are distributed by Antero Midstream Partners to Antero Resources.
−Removed: Antero Resources allocates a portion of equity-based compensation expense related to grants prior to the Transactions to Antero Midstream Partners based on its proportionate share of Antero Resources’ labor costs.
+Added: (1) Antero Resources recognized compensation expense for equity awards granted under both the 2013 Plan and the AMP Plan because the awards under the AMP Plan are accounted for as if they are distributed by Antero Midstream Partners to Antero Resources.
+Added: Antero Resources allocates a portion of equity-based compensation expense related to grants prior to the Simplification Transactions to Antero Midstream Partners based on its proportionate share of Antero Resources’ labor costs.
Through March 12, 2019, the total amount of equity-based compensation is included in the consolidated financial statements of Antero Resources;
and effective March 13, 2019 (date of deconsolidation), the amount allocated to Antero Midstream Partners is no longer reflected in Antero Resources’ consolidated financial statements.
−Removed: See Note 3—Deconsolidation of Antero Midstream Partners LP to the consolidated financial statements for further discussion on the Transactions.
+Added: See Note 3—Deconsolidation of Antero Midstream Partners to the consolidated financial statements for further discussion on the Simplification Transactions.
(a) Restricted Stock Unit Awards
3 unchanged sentences
The grant date fair values of these awards are determined based on the closing price of Antero Resources’ common stock on the date of the grant.
−Removed: A summary of RSU award activity for the year ended December 31, 2020 is as follows:
−Removed: Intrinsic Value
−Removed: (in thousands)
+Added: A summary of RSU award activity is as follows:
Total awarded and unvested—December 31, 2020
+Added: ( 3,622,741 )
Total awarded and unvested—December 31, 2021
−Removed: Intrinsic values are based on the closing price of Antero Resources’ common stock on the referenced dates.
−Removed: As of December 31, 2020, there was $ 23 million of unamortized equity-based compensation expense related to unvested restricted stock units.
+Added: As of December 31, 2021, there was approximately $ 24 million of unamortized equity-based compensation expense related to unvested RSUs.
That expense is expected to be recognized over a weighted average period of approximately 2.5 years.
−Removed: (b) Stock Options
−Removed: Stock options granted under the 2013 Plan have a maximum contractual life of 10 years .
−Removed: Expense related to stock options is recognized on a straight- line basis over the requisite service period of the entire award.
−Removed: Forfeitures are accounted for as they occur by reversing the expense previously recognized for awards that were forfeited during the period.
−Removed: Stock options were granted with an exercise price equal to or greater than the market price of Antero Resources’ common stock on the dates of grant.
ANTERO RESOURCES CORPORATION
Notes to Consolidated Financial Statements (Continued)
−Removed: A summary of stock option activity for the year ended December 31, 2020 is as follows:
−Removed: (in thousands)
−Removed: Outstanding—December 31, 2019
−Removed: Outstanding—December 31, 2020
−Removed: Vested—December 31, 2020
−Removed: Exercisable —December 31, 2020
−Removed: Intrinsic values are based on the exercise price of the options and the closing price of Antero Resources’ common stock on the referenced dates.
−Removed: A Black-Scholes option- pricing model is used to determine the grant-date fair value of stock options.
−Removed: Expected volatility was derived from the volatility of the historical stock prices of a peer group of similar publicly traded companies’ stock prices as Antero Resources’ common stock had traded for a relatively short period of time at the dates the options were granted.
−Removed: The risk-free interest rate was determined using the implied yield available for zero- coupon U.S.
−Removed: government issues with a remaining term approximating the expected life of the options.
−Removed: A dividend yield of zero was assumed.
−Removed: (c) Performance Share Unit Awards
+Added: (b) Performance Share Unit Awards
Performance Share Unit Awards Based on Stock Price Targets
−Removed: In 2016, the Company granted PSUs to certain of its executive officers that are based on stock price targets.
−Removed: The vesting of these PSUs is conditioned on the closing price of Antero Resources’ common stock achieving specific price thresholds over 10 -day periods, subject to the following vesting restrictions:
−Removed: no PSUs may vest before the first anniversary of the grant date;
−Removed: no more than one-third of the PSUs may vest before the second anniversary of the grant date;
−Removed: and no more than two-thirds of the PSUs may vest before the third anniversary of the grant date.
−Removed: Any PSUs which have not vested by the fifth anniversary of the grant date will expire.
−Removed: Expense related to these PSUs is recognized on a graded basis over three years .
−Removed: Forfeitures are accounted for as they occur by reversing the expense previously recognized for awards that were forfeited during the period.
−Removed: Performance Share Unit Awards Based on Total Shareholder Return (“TSR”)
−Removed: In 2016 and 2017, the Company granted PSUs to certain of its employees and executive officers that vest based on the TSR of Antero Resources’ common stock relative to the TSR of a peer group of companies over a three-year performance period.
−Removed: The number of shares of common stock which may ultimately be earned ranges from zero to 200 % of the PSUs granted.
−Removed: Expense related to these PSUs is recognized on a straight-line basis over three years .
−Removed: Forfeitures are accounted for as they occur by reversing the expense previously recognized for awards that were forfeited during the period.
+Added: In 2016, the Company granted PSUs to certain of its executive officers that were based on stock price targets.
+Added: The vesting of these PSUs was conditioned on the closing price of Antero Resources’ common stock achieving specific price thresholds over 10 -day periods, subject to the following vesting restrictions:
+Added: no PSUs could vest before the first anniversary of the grant date;
+Added: no more than one-third of the PSUs could vest before the second anniversary of the grant date;
+Added: and no more than two-thirds of the PSUs could vest before the third anniversary of the grant date.
+Added: Any PSUs that had not vested by the fifth anniversary of the grant date expired in 2021.
+Added: Expense related to these PSUs was recognized on a graded basis over three years .
+Added: Forfeitures were accounted for as they occurred by reversing the expense previously recognized for awards that were forfeited during the period.
+Added: One of the performance conditions was met, and vesting for one-third of these PSUs was achieved.
+Added: Performance Share Unit Awards Based on Total Shareholder Return and Return on Capital Employed
+Added: In 2018, the Company granted PSUs to certain of its employees and executive officers, a portion of which would vest based on the Company’s absolute total shareholder return (“TSR”), with target payout achieved if the price per share of Antero Resources’ common stock reaches 125 % of the beginning price (as defined in the award agreement) at the end of a three-year performance period (“2018 TSR PSUs”).
+Added: The number of awards actually earned with respect to the 2018 TSR PSUs were subject to further adjustment based on the TSR of Antero Resources’ common stock relative to the TSR of a peer group of companies over the same period.
+Added: The number of shares of common stock that could ultimately be earned with respect to the 2018 TSR PSUs ranged from zero to 200 % of the target number of 2018 TSR PSUs originally granted.
+Added: Expense related to the 2018 TSR PSUs was recognized on a straight-line basis over three years .
+Added: Forfeitures were accounted for as they occurred by reversing the expense previously recognized for awards that were forfeited during the period.
+Added: The other portion of the PSUs granted in 2018 would vest based on the Company’s actual return on capital employed (“ROCE”) (as defined in the award agreement) over a three-year period as compared to a targeted ROCE (“ROCE PSUs”).
+Added: The number of shares of common stock that could ultimately be earned with respect to the ROCE PSUs ranged from zero to 200 % of the target number of ROCE PSUs originally granted.
+Added: Expense related to the ROCE PSUs was recognized based on the number of shares of common stock that were expected to be issued at the end of the measurement period, and was reversed if the likelihood of achieving the performance condition decreased.
+Added: As of December 31, 2019, the likelihood of achieving the performance conditions related to the ROCE PSUs decreased to a level below probable and therefore, expense was not recognized during the years ended December 31, 2020 and 2021.
+Added: The performance conditions for the 2018 TSR PSUs and ROCE PSUs were not met, and no vesting for these awards was achieved.
+Added: Performance Share Unit Awards Based on Total Shareholder Return
+Added: In 2016 and 2017, the Company granted PSUs to certain of its employees and executive officers that would vest based on the TSR of Antero Resources’ common stock relative to the TSR of a peer group of companies over a three-year performance period.
+Added: The number of shares of common stock that were available to be earned ranged from zero to 200 % of the PSUs granted.
+Added: Expense related to these PSUs was recognized on a straight-line basis over three years .
+Added: Forfeitures were accounted for as they occurred by reversing the expense previously recognized for awards that were forfeited during the period.
+Added: The performance conditions for the 2016 and 2017 PSUs were not met, and no vesting was achieved.
In 2019, the Company granted PSUs to certain of its employees and executive officers that vest based on Antero Resources’ absolute TSR, with target payout achieved if the price per share of Antero Resources’ common stock reaches 125 % of the beginning price (as defined in the award agreement) at the end of a three-year performance period.
2 unchanged sentences
Forfeitures are accounted for as they occur by reversing the expense previously recognized for awards that were forfeited during the period.
−Removed: ANTERO RESOURCES CORPORATION
−Removed: Notes to Consolidated Financial Statements (Continued)
In 2020, the Company granted PSU awards to certain of its executive officers that vest based on Antero Resources’ absolute TSR determined as of the last day of each of three one-year performance periods ending on April 15, 2021, April 15, 2022 and April 15, 2023, and one cumulative three-year performance period ending on April 15, 2023, in each case, subject to the executive officer’s continued employment through April 15, 2023.
1 unchanged sentence
Expense related to these PSUs is recognized on a graded-vested basis over approximately three years .
−Removed: Forfeitures are accounted for as they occur by reversing the expense previously recognized for awards that were forfeited during the period.
+Added: Forfeitures are accounted for as they
+Added: ANTERO RESOURCES CORPORATION
+Added: Notes to Consolidated Financial Statements (Continued)
+Added: occur by reversing the expense previously recognized for awards that were forfeited during the period.
+Added: The performance condition for the performance period ending April 15, 2021 was met, and 150 % vesting was achieved for the award tranche.
Additionally, in 2020, the Company granted PSUs to certain of its executive officers that vest based on Antero Resources’ TSR relative to the TSR of certain peer companies determined as of the last day of each of three one-year performance periods ending on April 15, 2021, April 15, 2022, and April 15, 2023, and one cumulative three-year performance period ending on April 15, 2023, in each case, subject to the executive officer’s continued employment through April 15, 2023.
2 unchanged sentences
Forfeitures are accounted for as they occur by reversing the expense previously recognized for awards that were forfeited during the period.
−Removed: Performance Share Unit Awards Based on TSR and Return on Capital Employed (“ROCE”)
−Removed: In 2018, the Company granted PSUs to certain of its employees and executive officers, a portion of which vest based on the Company’s absolute TSR, with target payout achieved if the price per share of Antero Resources’ common stock reaches 125 % of the beginning price (as defined in the award agreement) at the end of a three-year performance period (“2018 TSR PSUs”).
−Removed: The number of awards actually earned with respect to the 2018 TSR PSUs will be subject to further adjustment based on the TSR of Antero Resources’ common stock relative to the TSR of a peer group of companies over the same period.
−Removed: The number of shares of common stock that may ultimately be earned with respect to the 2018 TSR PSUs ranges from zero to 200 % of the target number of 2018 TSR PSUs originally granted.
−Removed: Expense related to the 2018 TSR PSUs is recognized on a straight-line basis over three years .
+Added: The performance condition for the performance period ending April 15, 2021 was met, and 150 % vesting was achieved for the award tranche.
+Added: In 2021, the Company granted PSU awards to certain of its executive officers that vest based on Antero Resources’ absolute TSR determined as of the last day of each of three one-year performance periods ending on April 15, 2022, April 15, 2023, and April 15, 2024, and one cumulative three-year performance period ending on April 15, 2024, in each case, subject to the executive officer’s continued employment through April 15, 2024.
+Added: The number of shares of common stock that may ultimately be earned following the end of the cumulative three-year performance period with respect to the TSR PSUs ranges from zero to 200 % of the target number of TSR PSUs originally granted.
+Added: Expense related to these PSUs is recognized on a graded-vested basis over the term of each performance period.
Forfeitures are accounted for as they occur by reversing the expense previously recognized for awards that were forfeited during the period.
−Removed: The other portion of the PSUs granted in 2018 vest based on the Company’s actual ROCE (as defined in the award agreement) over a three-year period as compared to a targeted ROCE (“ROCE PSUs”).
−Removed: The number of shares of common stock that may ultimately be earned with respect to the ROCE PSUs ranges from zero to 200 % of the target number of ROCE PSUs originally granted.
−Removed: Expense related to the ROCE PSUs is recognized based on the number of shares of common stock that are expected to be issued at the end of the measurement period, and is reversed if the likelihood of achieving the performance condition decreases.
−Removed: As of December 31, 2019, the likelihood of achieving the performance conditions related to the ROCE PSUs decreased to a level below probable and therefore, expense has not been recognized in the current year and will not be recognized unless the likelihood of achieving the performance condition becomes probable.
+Added: Performance Share Unit Awards Based on Leverage Ratio
+Added: In April 2021, the Company granted PSUs to certain of its executive officers that vest based on the Company’s total debt less cash and cash equivalents divided by the Company’s Adjusted EBITDAX ( as defined in the award agreement ) determined as of the last day of each of three one-year performance periods ending on December 31, 2021, December 31, 2022, and December 31, 2023, in each case, subject to the executive officer’s continued employment through December 31, 2023 (“Leverage Ratio PSUs”).
+Added: The number of shares of common stock that may ultimately be earned with respect to the Leverage Ratio PSUs ranges from zero to 200 % of the target number of Leverage Ratio PSUs originally granted.
+Added: Expense related to the Leverage Ratio PSUs is recognized based on the number of shares of common stock that are expected to be issued at the end of each measurement period, and such expense is reversed if the likelihood of achieving the performance condition becomes improbable.
+Added: As of December 31, 2021, the likelihood of achieving the performance conditions related to the Leverage Ratio PSUs was probable.
Summary Information for Performance Share Unit Awards
−Removed: A summary of PSU activity for the year ended December 31, 2020 is as follows:
+Added: A summary of PSU activity is as follows:
Average Grant
2 unchanged sentences
Cancelled (unearned)
+Added: ( 1,112,639 )
Total awarded and unvested—December 31, 2021
4 unchanged sentences
A dividend yield of zero was assumed.
−Removed: The grant-date fair value for the ROCE-based PSUs is based on the closing price of Antero Resources’ common stock on the date of the grant, assuming the achievement of the performance condition.
+Added: The grant-date fair value for the ROCE-based and Adjusted EBITDAX-based PSUs was based on the closing price of Antero Resources’ common stock on the date of the grant, assuming target achievement of the performance condition.
+Added: The following table presents information regarding the weighted average fair values for market-based PSUs, and the assumptions used to determine the fair values:
ANTERO RESOURCES CORPORATION
Notes to Consolidated Financial Statements (Continued)
−Removed: The following table presents information regarding the weighted average fair values for market-based PSUs granted during the years ended December 31, 2018, 2019 and 2020, and the assumptions used to determine the fair values:
Year Ended December 31,
5 unchanged sentences
That expense is expected to be recognized over a weighted average period of approximately 1.9 years.
−Removed: (d) Cash Retention Awards
−Removed: In January 2020, the Company granted cash awards of approximately $ 3.3 million to certain executives under the 2013 Plan, and compensation expense for these awards is recognized ratably over the vesting period for each of three tranches through January 20, 2023.
−Removed: In July 2020, the Company granted additional cash awards on the aggregate of $ 2.6 million to certain non-executive employees under the 2020 Plan that vest ratably over four years .
−Removed: As of December 31, 2020, the Company has accrued approximately $ 3.2 million in Other liabilities in the consolidated balance sheet related to cash awards.
−Removed: (e) Antero Midstream Corporation Restricted Stock Unit Awards
+Added: (c) Converted AM Restricted Share Unit Awards
Phantom units granted by Antero Midstream Partners vested subject to the satisfaction of service requirements, upon the completion of which common units in Antero Midstream Partners were delivered to the holder of the phantom units.
5 unchanged sentences
The grant date fair values of these awards were determined based on the closing price of Antero Midstream Partners’ common units on the date of grant.
−Removed: In connection with the closing of the Transactions, the Board of Directors of Antero Midstream Corporation adopted the AMC Plan.
−Removed: In accordance with the terms of the Transactions, each outstanding phantom unit under the AMP Plan was assumed by Antero Midstream Corporation and converted into 1.8926 restricted stock units under the AMC Plan.
−Removed: A summary of Antero Midstream Corporation RSU awards for the year ended December 31, 2020 is as follows:
−Removed: Intrinsic Value
−Removed: (in thousands)
+Added: In connection with the closing of the Simplification Transactions, the Board of Directors of Antero Midstream adopted the AM Plan.
+Added: In accordance with the terms of the Simplification Transactions, each outstanding phantom unit under the AMP Plan was assumed by Antero Midstream and converted into 1.8926 restricted stock units under the AM Plan.
+Added: A summary of the Converted AM RSU Awards is as follows:
Total awarded and unvested—December 31, 2020
Total awarded and unvested—December 31, 2021
−Removed: Intrinsic values are based on the closing price of shares of Antero Midstream Corporation’s common stock or Antero Midstream Partners’ common units, as applicable, on the referenced dates.
−Removed: As of December 31, 2020, there was $ 2.2 million of unamortized equity-based compensation expense related to unvested phantom unit awards.
+Added: As of December 31, 2021, there was $ 0.4 million of unamortized equity-based compensation expense related to unvested Converted AM RSU Awards.
That expense is expected to be recognized over a weighted average period of approximately 0.3 years, and the Company’s proportionate share will be allocated to it as it is recognized
+Added: (d) Stock Options
+Added: Stock options granted under the 2013 Plan have a maximum contractual life of 10 years .
+Added: Expense related to stock options is recognized on a straight- line basis over the requisite service period of the entire award.
+Added: Forfeitures are accounted for as they occur by reversing the expense previously recognized for awards that were forfeited during the period.
+Added: Stock options were granted with an exercise price equal to or greater than the market price of Antero Resources’ common stock on the dates of grant.
ANTERO RESOURCES CORPORATION
Notes to Consolidated Financial Statements (Continued)
+Added: A summary of stock option activity is as follows:
+Added: (in thousands)
+Added: Outstanding—December 31, 2020
+Added: Outstanding—December 31, 2021
+Added: Vested—December 31, 2021
+Added: Exercisable—December 31, 2021
+Added: Intrinsic values are based on the exercise price of the options and the closing price of Antero Resources’ common stock on the referenced dates.
+Added: A Black-Scholes option- pricing model is used to determine the grant-date fair value of stock options.
+Added: Expected volatility was derived from the volatility of the historical stock prices of a peer group of similar publicly traded companies’ stock prices as Antero Resources’ common stock had traded for a relatively short period of time at the dates the options were granted.
+Added: The risk-free interest rate was determined using the implied yield available for zero- coupon U.S.
+Added: government issues with a remaining term approximating the expected life of the options.
+Added: A dividend yield of zero was assumed.
+Added: (e) Cash Awards
+Added: In January 2020, the Company granted cash awards of approximately $ 3 million to certain executives under the 2013 Plan, and compensation expense for these awards is recognized ratably over the vesting period for each of three tranches through January 20, 2023.
+Added: In July 2020, the Company granted additional cash awards on the aggregate of $ 3 million to certain non-executive employees under the 2020 Plan that vest ratably over four years .
+Added: As of December 31, 2020 and 2021, the Company has recorded approximately $ 3 million and $ 2 million, respectively, in Other liabilities in the consolidated balance sheets related to unvested cash awards.
(11) Fair Value
1 unchanged sentence
The carrying values of the amounts outstanding under the Credit Facility as of December 31, 2020 and 2021 approximated fair value because the variable interest rates are reflective of current market conditions.
−Removed: The fair value and carrying value of the senior notes and 2026 Convertible Notes as of December 31, 2019 and 2020 are as follows (in thousands):
−Removed: December 31, 2019
−Removed: December 31, 2020
−Removed: 5.375 % senior notes due 2021
−Removed: 5.125 % senior notes due 2022
−Removed: 5.625 % senior notes due 2023
−Removed: 5.00 % senior notes due 2025
−Removed: 4.25 % convertible senior notes due 2026 (3)
+Added: The following table sets forth the fair value and carrying value of the senior notes and 2026 Convertible Notes (in thousands):
+Added: ANTERO RESOURCES CORPORATION
+Added: Notes to Consolidated Financial Statements (Continued)
+Added: 2026 Convertible Notes
(1) Fair values are based on Level 2 market data inputs.
(2) Carrying values are presented net of unamortized debt issuance costs and debt discounts or premiums.
−Removed: (3) Carrying value excludes the equity component of $ 116 million recorded to additional paid-in-capital for the 2026 Convertible Notes.
See Note 12—Derivative Instruments to the consolidated financial statements for information regarding the fair value of derivative financial instruments.
11 unchanged sentences
When actual commodity prices upon settlement are less than the contractually provided fixed price, the Company receives the difference from the counterparty.
−Removed: In addition, the Company has entered into basis swap contracts in order to hedge the difference between the New York Mercantile Exchange (“NYMEX”) index price and a local index price.
−Removed: The Company also entered into NGL derivative contracts, which establish a contractual price for the settlement month as a fixed percentage of the West Texas Intermediate Crude Oil index (“WTI”) price for the settlement month.
−Removed: When the percentage of the contractual price is above the contracted percentage, the Company pays the difference to the counterparty.
−Removed: When it is below the contracted percentage, the Company receives the difference from the counterparty.
+Added: In addition, the Company has entered into basis swap contracts in order to hedge the difference between the NYMEX index price and a local index price.
The Company’s derivative contracts have not been designated as hedges for accounting purposes;
therefore, all gains and losses are recognized in the Company’s statements of operations.
−Removed: ANTERO RESOURCES CORPORATION
−Removed: Notes to Consolidated Financial Statements (Continued)
−Removed: As of December 31, 2020, the Company’s fixed price natural gas, oil and NGL swap positions from January 1, 2021 through December 31, 2023 were as follows:
+Added: As of December 31, 2021, the Company’s fixed price swap positions excluding Martica, the Company’s consolidated VIE were as follows:
Commodity / Settlement Period
2 unchanged sentences
January-December 2023
−Removed: January-December 2023
−Removed: OPIS Ethane Mt Belv
−Removed: January-March 2021
−Removed: Mont Belvieu Purity Ethane-OPIS
−Removed: January-December 2021
−Removed: West Texas Intermediate
−Removed: In addition, the Company has a call option agreement, which entitles the holder the right, but not the obligation, to enter into a fixed price swap agreement on December 21, 2023 to purchase 427,500 MMBtu per day at a price of $ 2.77 per MMBtu for the year ending December 31, 2024.
+Added: ANTERO RESOURCES CORPORATION
+Added: Notes to Consolidated Financial Statements (Continued)
+Added: In addition, the Company has a swaption agreement, which entitles the counterparty the right, but not the obligation, to enter into a fixed price swap agreement on December 21, 2023 to purchase 427,500 MMBtu per day at a price of $ 2.77 per MMBtu for the year ending December 31, 2024.
As of December 31, 2021, the Company’s natural gas basis swap positions, which settle on the pricing index to basis differential of the Columbia Gas Transmission pipeline (“TCO”) to the NYMEX Henry Hub natural gas price, were as follows:
7 unchanged sentences
January-December 2024
−Removed: January-December 2024
−Removed: As of December 31, 2020, the Company had natural gas and NGL contracts for January 1, 2021 through December 31, 2021 that fix the Mont Belvieu index price to percentages of WTI as follows:
−Removed: Weighted Average
−Removed: Commodity / Settlement Period
−Removed: Index to Basis Differential
−Removed: Contracted Volume
−Removed: January-December 2021
−Removed: Mont Belvieu Natural Gasoline to WTI
−Removed: ANTERO RESOURCES CORPORATION
−Removed: Notes to Consolidated Financial Statements (Continued)
−Removed: As of December 31, 2020, the Company’s fixed price natural gas, oil and NGL swap positions from January 1, 2021 through March 31, 2025 for Martica, the Company’s consolidated VIE, were as follows:
+Added: As of December 31, 2021, the Company’s fixed price swap positions for Martica, the Company’s consolidated VIE, were as follows:
Commodity / Settlement Period
3 unchanged sentences
January-December 2024
−Removed: January-December 2024
January-March 2025
−Removed: OPIS Propane Mt Belv Non-TET
−Removed: January-December 2021
−Removed: Mont Belvieu Propane-OPIS
−Removed: January-December 2022
−Removed: Mont Belvieu Propane-OPIS
−Removed: OPIS Natural Gasoline Mt Belv Non-TET
−Removed: January-December 2021
−Removed: Mont Belvieu Natural Gasoline-OPIS
−Removed: January-December 2022
−Removed: Mont Belvieu Natural Gasoline-OPIS
−Removed: OPIS Ethane Mt Belv
−Removed: January-December 2021
−Removed: Mont Belvieu Purity Ethane-OPIS
January-March 2022
1 unchanged sentence
January-December 2022
−Removed: West Texas Intermediate
+Added: Mont Belvieu Propane-OPIS Non-TET
+Added: Natural Gasoline
January-December 2022
+Added: Mont Belvieu Natural Gasoline-OPIS Non-TET
+Added: January-December 2023
+Added: Mont Belvieu Natural Gasoline-OPIS Non-TET
+Added: January-December 2022
West Texas Intermediate
5 unchanged sentences
West Texas Intermediate
+Added: ANTERO RESOURCES CORPORATION
+Added: Notes to Consolidated Financial Statements (Continued)
Embedded Derivatives
1 unchanged sentence
The embedded put option is not clearly and closely related to the host contract, and therefore, the Company bifurcated this derivative instrument and reflected it at fair value in the consolidated financial statements.
−Removed: Marketing Derivatives
−Removed: In 2017, due to delay of the in-service date for a pipeline on which the Company is to be an anchor shipper, the Company realized it would not be able to fulfill its delivery obligations under a 2018 natural gas sales contract.
−Removed: In order to acquire gas to fulfill its delivery obligations, the Company entered into several natural gas purchase agreements with index-based pricing to purchase gas for resale under this sales contract.
−Removed: Subsequently, the Company and the counterparty to the sales contract came to an agreement that the Company’s delivery obligations under the contract would not begin until the earlier of (1) the in-service date of the pipeline and (2) January 1, 2019.
−Removed: Consequently, in December 2017, the Company entered into natural gas sales agreements with index-based pricing to resell the purchased gas for delivery during the period from February to October 2018.
−Removed: The natural gas that it had purchased for January was sold on the spot market during January 2018.
−Removed: The Company determined that these gas purchase and sales agreements should be accounted for as derivatives and measured at fair value at the end of each period.
−Removed: For the year ended December 31, 2018, the Company recognized a fair value gain of $ 94
−Removed: ANTERO RESOURCES CORPORATION
−Removed: Notes to Consolidated Financial Statements (Continued)
−Removed: million and realized proceeds of $ 73 million.
−Removed: There were no marketing derivative fair value gains or losses for the years ended December 31, 2019 and 2020.
−Removed: The following table presents a summary of the fair values of the Company’s derivative instruments and where such values are recorded in the consolidated balance sheets as of December 31, 2019 and 2020.
−Removed: None of the Company’s derivative instruments are designated as hedges for accounting purposes.
+Added: The table below presents a summary of the fair values of the Company’s derivative instruments and where such values are recorded in the consolidated balance sheets (in thousands).
Balance Sheet
15 unchanged sentences
Total liability derivatives (1)
−Removed: Net derivatives assets
+Added: Net derivatives asset (liability) (1)
+Added: (1) The fair value of derivative instruments was determined using Level 2 inputs.
(2) As of December 31, 2020, approximately $ 14 million of commodity derivative liabilities, including $ 7 million of current commodity derivatives and $ 7 million of noncurrent commodity derivatives, are attributable to the Company’s consolidated VIE, Martica.
−Removed: The following table presents the gross values of recognized derivative assets and liabilities, the amounts offset under master netting arrangements with counterparties, and the resulting net amounts presented in the consolidated balance sheets as of the dates presented, all at fair value (in thousands):
+Added: As of December 31, 2021, approximately $ 55 million of commodity derivative liabilities, including $ 31 million of current commodity derivatives and $ 24 million of noncurrent commodity derivatives, are attributable to the Company’s consolidated VIE, Martica
+Added: The following table sets forth the gross values of recognized derivative assets and liabilities, the amounts offset under master netting arrangements with counterparties, and the resulting net amounts presented in the consolidated balance sheets as of the dates presented, all at fair value (in thousands):
December 31, 2020
2 unchanged sentences
Net Amounts of
−Removed: Gross Amounts
−Removed: Gross Amounts
+Added: Amounts Offset
(Liabilities) on
+Added: Amounts Offset
(Liabilities) on
1 unchanged sentence
Balance Sheet
−Removed: Balance Sheet
−Removed: Balance Sheet
−Removed: Balance Sheet
−Removed: Balance Sheet
Commodity derivative assets
1 unchanged sentence
Commodity derivative liabilities
−Removed: The following is a summary of derivative fair value gains and losses and where such values are recorded in the consolidated statements of operations for the years ended December 31, 2018, 2019 and 2020 (in thousands):
+Added: The following table sets forth a summary of derivative fair value gains and losses and where such values are recorded in the consolidated statements of operations (in thousands):
ANTERO RESOURCES CORPORATION
2 unchanged sentences
Commodity derivative fair value gains (losses) (1)
+Added: ( 1,886,551 )
Embedded derivative fair value gains (losses) (1)
−Removed: Commodity derivative fair value gains (losses) for the years ended December 31, 2018 and 2020, include gains of $ 370 million and $ 9 million, respectively, related to certain natural gas derivatives that were monetized prior to their contractual settlement dates.
−Removed: Proceeds received from the monetizations are classified as operating cash flows on the Company’s consolidated statement of cash flows for the years ended December 31, 2018 and 2020.
−Removed: There were no commodity derivatives monetizations in the year ended December 31, 2019.
−Removed: The 2018 monetizations were affected by the early settlement of April through December 2019 swaps and reducing the average fixed index prices on certain natural gas swap contracts maturing in 2020 while maintaining the total volumes hedged.
−Removed: The April through December 2019 swaps were replaced with collar agreements for which the Company paid a $ 13 million premium.
(1) The fair value of derivative instruments was determined using Level 2 inputs .
−Removed: The Company’s commodity derivative position presented in Note 12(a) above reflects the volume and adjusted fixed price indices after the 2020 monetization.
−Removed: On February 25, 2016, the FASB issued ASU No.
−Removed: 2016-02, Leases , which requires lessees to record lease liabilities and right-of-use assets as of the date of adoption and was incorporated into GAAP as ASC Topic 842, Leases .
−Removed: The new lease standard does not substantially change accounting by lessors.
−Removed: The Company adopted the new standard effective January 1, 2019.
−Removed: The Company is a lessee to both operating and finance lease arrangements.
−Removed: The standard resulted in an increase in assets and liabilities related to the Company’s operating leases.
+Added: Commodity derivative fair value gains (losses) for the years ended December 31, 2020 and 2021, include a gain of $ 9 million and a loss of $ 5 million, respectively, related to certain natural gas derivatives that were monetized prior to their contractual settlement dates.
+Added: Proceeds received from and payments for the monetizations are classified as operating cash flows on the Company’s consolidated statement of cash flows for the years ended December 31, 2020 and 2021.
+Added: There were no commodity derivatives monetizations in the year ended December 31, 2019.
+Added: The Company’s commodity derivative position presented in Note 12(a) above reflects the volume and adjusted fixed price indices after the 2020 and 2021 monetizations.
The Company leases certain office space, processing plants, drilling rigs and completion services, gas gathering lines, compressor stations, and other office and field equipment.
2 unchanged sentences
Most leases include one or more options to renew, with renewal terms that can extend the lease from one to 20 years or more.
−Removed: The exercise of the lease renewal options are at the Company’s sole discretion.
−Removed: The depreciable lives of the leased assets are limited by the expected lease term, unless there is a transfer of title or purchase option reasonably certain of exercise.
+Added: The exercise of the lease renewal options is at the Company’s sole discretion.
+Added: The depreciable lives of the leased assets are limited by the expected lease term, unless there are a transfer of title or purchase option reasonably certain of exercise.
Certain of the Company’s lease agreements include minimum payments based on a percentage of produced volumes over contractual levels and others include rental payments adjusted periodically for inflation.
−Removed: The Company elected the effective date method for adoption of the new leasing standard.
−Removed: This method allows the Company to not make retrospective adjustments for leases that were in effect prior to the adoption date of January 1, 2019 when disclosing comparable prior periods, but instead, account for the prior period leases under ASC Topic 840, which was the guidance in place at the time of the original reporting.
The Company considers all contracts that have assets specified in the contract, either explicitly or implicitly, that the Company has substantially all of the capacity of the asset, and has the right to obtain substantially all of the economic benefits of that asset, without the lessor’s ability to have a substantive right to substitute that asset, as leased assets.
4 unchanged sentences
As new leases commence or previous leases are modified the discount rate used in the present value calculation is the current period applicable discount rate.
−Removed: ANTERO RESOURCES CORPORATION
−Removed: Notes to Consolidated Financial Statements (Continued)
The Company has made an accounting policy election to adopt the practical expedient for combining lease and non-lease components on an asset class basis.
1 unchanged sentence
Currently, the Company is only applying this expedient to certain office space agreements.
−Removed: Supplemental Balance Sheet Information Related to Leases
−Removed: The Company’s lease assets and liabilities as of December 31, 2019 and 2020 consisted of the following items (in thousands):
+Added: ANTERO RESOURCES CORPORATION
+Added: Notes to Consolidated Financial Statements (Continued)
+Added: (a) Supplemental Balance Sheet Information Related to Leases
+Added: The Company’s lease assets and liabilities consisted of the following items (in thousands):
Balance Sheet Classification
20 unchanged sentences
Other property and equipment
−Removed: Other office and field equipment
−Removed: Other property and equipment
Total finance lease right-of-use assets (2)
4 unchanged sentences
Total finance lease obligation
−Removed: (1) Gas gathering lines and compressor stations leases includes $ 1.1 billion related to Antero Midstream Corporation as of December 31, 2019 and 2020.
+Added: (1) Gas gathering lines and compressor stations leases includes $ 1.1 billion and $ 1.5 billion related to Antero Midstream as of December 31, 2020 and 2021 , respectively.
See “—Related party lease disclosure” for additional discussion.
(2) Financing lease assets are recorded net of accumulated amortization of $ 3 million and $ 2 million as of December 31, 2020 and 2021 , respectively.
−Removed: The processing plants, gathering lines and compressor stations that are classified as lease liabilities are classified as such under ASC Topic 842, Leases , because Antero is the sole customer of the assets and because Antero makes the decisions that most impact the economic performance of the assets.
+Added: The processing plants, gathering lines and compressor stations that are classified as lease liabilities are classified as such under ASC 842, Leases , because Antero is the sole customer of the assets and because Antero makes the decisions that most impact the economic performance of the assets.
ANTERO RESOURCES CORPORATION
Notes to Consolidated Financial Statements (Continued)
−Removed: Supplemental Information Related to Leases
−Removed: Costs associated with operating leases were included in the consolidated statement of operations and comprehensive loss for the years ended December 31, 2019 and 2020 (in thousands):
+Added: (b) Supplemental Information Related to Leases
+Added: Costs associated with operating and finance leases were included in the consolidated statement of operations and comprehensive loss (in thousands):
+Added: Year Ended December 31,
Classification
9 unchanged sentences
Operating lease cost
+Added: Statement of operations
+Added: Lease operating
+Added: Operating lease cost
Balance sheet
11 unchanged sentences
(1) Capitalized costs related to drilling and completion activities.
−Removed: Supplemental Cash Flow Information Related to Leases
−Removed: The following is the Company’s supplemental cash flow information related to leases for years ended December 31, 2019 and 2020 (in thousands):
+Added: (c) Supplemental Cash Flow Information Related to Leases
+Added: The following is the Company’s supplemental cash flow information related to leases (in thousands):
Year Ended December 31,
5 unchanged sentences
Noncash activities:
−Removed: ROU assets obtained in exchange for new operating lease obligations
−Removed: Maturities of Lease Liabilities
+Added: Right-of-use assets obtained in exchange for new operating lease obligations
+Added: Increase (decrease) to existing right-of-use assets and lease obligations from operating lease modifications, net (1)
+Added: (1) During the year ended December 31, 2019, the weighted average discount rate for remeasured operating leases increased from 6.0 % as of January 1, 2019 to 12.4 % as of December 31, 2019 .
+Added: During the year ended December 31, 2020 , the weighted average discount rate for remeasured operating leases increased from 10.0 % as of December 31, 2019 to 14.4 % as of December 31, 2020 .
+Added: During the year ended December 31, 2021 , the weighted average discount rate for remeasured operating leases decreased from 14.4 % as of December 31, 2020 to 5.0 % as of December 31, 2021.
+Added: ANTERO RESOURCES CORPORATION
+Added: Notes to Consolidated Financial Statements (Continued)
+Added: (d) Maturities of Lease Liabilities
The table below is a schedule of future minimum payments for operating and financing lease liabilities as of December 31, 2021 (in thousands):
−Removed: (in thousands)
Operating Leases
2 unchanged sentences
imputed interest
−Removed: ( 1,770,511 )
−Removed: ( 1,770,580 )
−Removed: ANTERO RESOURCES CORPORATION
−Removed: Notes to Consolidated Financial Statements (Continued)
−Removed: Lease Term and Discount Rate
−Removed: The table below is the Company’s weighted-average remaining lease term and discount rate as of December 31, 2020:
+Added: (e) Lease Term and Discount Rate
+Added: The following table sets forth the Company’s weighted-average remaining lease term and discount rate:
December 31, 2020
+Added: December 31, 2021
Operating Leases
Finance Leases
+Added: Operating Leases
+Added: Finance Leases
Weighted average remaining lease term
Weighted average discount rate
−Removed: Related Party Lease Disclosure
−Removed: The Company has a gathering and compression agreement with Antero Midstream Corporation, whereby Antero Midstream Corporation receives a low-pressure gathering fee per Mcf, a high-pressure gathering fee per Mcf, and a compression fee per Mcf, in each case subject to adjustments based on the consumer price index.
−Removed: If and to the extent the Company requests that Antero Midstream Corporation construct new high pressure lines and compressor stations, the gathering and compression agreement contains minimum volume commitments that require Antero Resources to utilize or pay for 75 % of the gathering capacity and 70 % of the compression capacity of such new construction for 10 years .
−Removed: In December 2019, the Company and Antero Midstream Corporation agreed to extend the initial term of the gathering and compression agreement to 2038 and established a growth incentive fee program whereby low-pressure gathering fees will be reduced from 2020 through 2023 to the extent the Company achieves certain volumetric targets at certain points during such time.
−Removed: Upon completion of the initial contract term, the gathering and compression agreement will continue in effect from year to year until such time as the agreement is terminated, effective upon an anniversary of the effective date of the agreement, by either the Company or Antero Midstream Corporation on or before the 180 th day prior to the anniversary of such effective date.
−Removed: The Company achieved the volumetric targets during each quarter during the year ended December 31, 2020.
−Removed: Antero Midstream Corporation has provided rebates of $ 48 million for the year ended December 31, 2020.
−Removed: For the years ended December 31, 2019 and 2020, gathering and compression fees paid by Antero related to this agreement were $ 643 million and $ 679 million, respectively.
−Removed: As of December 31, 2019 and 2020, $ 57 million and $ 55 million was included within Accounts payable, related parties, respectively, on the consolidated balance sheet as due to Antero Midstream Corporation related to this agreement.
+Added: (f) Related Party Lease Disclosure
+Added: The Company has a gathering and compression agreement with Antero Midstream, whereby Antero Midstream receives a low-pressure gathering fee per Mcf, a high-pressure gathering fee per Mcf, and a compression fee per Mcf, in each case subject to annual adjustments based on the consumer price index.
+Added: If and to the extent the Company requests that Antero Midstream construct new high pressure lines and compressor stations, the gathering and compression agreement contains options at Antero Midstream’s election for either (i) minimum volume commitments that require Antero Resources to utilize or pay for 75 % of the high pressure gathering capacity and 70 % of the compression capacity of such new construction for 10 years or (ii) a cost of service fee that allows the Antero Midstream to earn a 13 % rate of return on such new construction over seven years .
+Added: In December 2019, the Company and Antero Midstream agreed to extend the initial term of the gathering and compression agreement to 2038 and established a growth incentive fee program whereby low-pressure gathering fees will be reduced from 2020 through 2023 to the extent the Company achieves certain volumetric targets at certain points during such time.
+Added: Upon completion of the initial contract term, the gathering and compression agreement will continue in effect from year to year until such time as the agreement is terminated, effective upon an anniversary of the effective date of the agreement, by either the Company or Antero Midstream on or before the 180 th day prior to the anniversary of such effective date.
+Added: The Company achieved the volumetric targets during each quarter for the year ended December 31, 2020, and earned rebates of $ 48 million.
+Added: The Company achieved the volumetric target during the fourth quarter of 2021, and earned a rebate of $ 12 million.
+Added: For the years ended December 31, 2019, 2020 and 2021, gathering and compression fees paid by Antero related to this agreement were $ 643 million, $ 679 million and $ 705 million, respectively.
+Added: As of December 31, 2020 and 2021, $ 55 million and $ 54 million was included within Accounts payable, related parties, respectively, on the consolidated balance sheet as due to Antero Midstream related to this agreement.
+Added: ANTERO RESOURCES CORPORATION
+Added: Notes to Consolidated Financial Statements (Continued)
(14) Income Taxes
−Removed: For the years ended December 31, 2018, 2019 and 2020, income tax benefit consisted of the following (in thousands):
+Added: The Company’s income tax benefit consisted of the following (in thousands):
Year Ended December 31,
−Removed: Federal income tax expense (benefit)
−Removed: State income tax expense (benefit), net of federal benefit
+Added: Current income tax expense (benefit)
+Added: Deferred income tax benefit
Total income tax benefit
−Removed: ANTERO RESOURCES CORPORATION
−Removed: Notes to Consolidated Financial Statements (Continued)
Income tax expense (benefit) differs from the amount that would be computed by applying the U.S.
−Removed: statutory federal income tax rate of 21 % to the years ended December 31, 2018, 2019 and 2020 to income or loss before taxes as a result of the following (in thousands):
+Added: statutory federal income tax rate of 21 % to income or loss before taxes as a result of the following (in thousands):
Year Ended December 31,
7 unchanged sentences
Change in valuation allowance
+Added: Nondeductible loss on 2026 Convertible Notes equitization
Total income tax benefit
Deferred income taxes reflect the impact of temporary differences between assets and liabilities for financial reporting purposes and such amounts as measured by tax laws.
−Removed: The tax effect of the temporary differences giving rise to net deferred tax assets and liabilities as of December 31, 2019 and 2020 is as follows (in thousands):
+Added: The tax effect of the temporary differences giving rise to net deferred tax assets and liabilities is as follows (in thousands):
Deferred tax assets:
2 unchanged sentences
Investment in Antero Midstream
+Added: Unrealized losses on derivative instruments
+Added: Asset retirement obligations and other
Total deferred tax assets
5 unchanged sentences
Investment in Martica
−Removed: 2026 Convertible Notes
+Added: 2026 Convertible Notes and other
Total deferred tax liabilities
2 unchanged sentences
The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income during the periods in which the Company’s temporary differences become deductible.
−Removed: Management considers the scheduled reversal of deferred tax liabilities, projected future taxable income and tax planning strategies in making this assessment.
+Added: Management considers the scheduled reversal of deferred tax liabilities, projected future taxable income and tax planning
+Added: ANTERO RESOURCES CORPORATION
+Added: Notes to Consolidated Financial Statements (Continued)
+Added: strategies in making this assessment.
Based upon the projections of future taxable income over the periods in which the deferred tax assets are deductible, management believes that the Company will not realize the benefits of certain of these deductible differences and has recorded a valuation allowance of approximately $ 46 million and $ 50 million as of December 31, 2020 and 2021, respectively.
−Removed: The valuation allowance for each of the years ended December 31, 2019 and 2020, relates to Colorado and Oklahoma state NOL carryforwards and is primarily the result of expected future reduced income tax apportionment in those states.
+Added: The valuation allowance as of December 31, 2020 and 2021, relates to Colorado, Oklahoma and West Virginia state NOL carryforwards and is primarily the result of expected future reduced income tax apportionment in those states.
The amount of the deferred tax asset considered realizable could be further reduced in the near term if estimates of future taxable income during the carryforward period are revised.
The calculation of the Company’s tax liabilities involves uncertainties in the application of complex tax laws and regulations.
−Removed: The Company gives financial statement recognition to those tax positions that it believes are more-likely-than-not to be sustained upon
−Removed: ANTERO RESOURCES CORPORATION
−Removed: Notes to Consolidated Financial Statements (Continued)
−Removed: examination by the Internal Revenue Service or state revenue authorities.
+Added: The Company gives financial statement recognition to those tax positions that it believes are more-likely-than- not to be sustained upon examination by the Internal Revenue Service or state revenue authorities.
The Company monitors potential uncertain tax positions but does not anticipate any changes in 2022.
10 unchanged sentences
(15) Commitments
−Removed: The table below is a schedule of future minimum payments for firm transportation, drilling rig and completion services, processing, gathering and compression, and office and equipment agreements, which include leases that have remaining lease terms in excess of one year as of December 31, 2020 (in thousands).
+Added: The following table sets forth a schedule of future minimum payments for firm transportation, drilling rig and completion services, processing, gathering and compression, and office and equipment agreements, which include leases that have a lease term in excess of one year as of December 31, 2021 (in thousands).
Gathering and
9 unchanged sentences
however, the Company will record in the consolidated financial statements its proportionate share of costs based on its working interest.
−Removed: ANTERO RESOURCES CORPORATION
−Removed: Notes to Consolidated Financial Statements (Continued)
Processing, Gathering, and Compression Service Commitments
2 unchanged sentences
The minimum payment obligations under the agreements that are not leases are presented in this column.
+Added: ANTERO RESOURCES CORPORATION
+Added: Notes to Consolidated Financial Statements (Continued)
The values in the table represent the gross amounts that the Company is committed to pay;
12 unchanged sentences
The Company incurs costs associated with the delay or cancellation of drilling and completion contracts with third-party contractors.
−Removed: These costs are recorded in Contract termination and rig stacking and included in the statement of operations and comprehensive income (loss) for the years ended December 31, 2018, 2019 and 2020 (in thousands):
−Removed: Year Ended December 31,
−Removed: Contract termination and rig stacking
+Added: These costs are recorded in Contract termination and rig stacking and included in the statement of operations and comprehensive loss.
+Added: There are no remaining payment obligations related to these delayed or cancelled drilling and completion contracts as of December 31, 2021.
(16) Contingencies
3 unchanged sentences
The NOV alleges that combustion devices at these facilities did not meet applicable air permitting requirements.
−Removed: Separately, in June 2018, the Company received an information request from EPA Region III pursuant to Section 114(a) of the Clean Air Act relating to the facilities that were inspected in September 2017 as well as additional Antero Resources facilities for the purpose of determining if the additional facilities have the same alleged compliance issues that were identified during the September 2017 inspections.
−Removed: Subsequently, the West Virginia Department of Environmental Protection (“WVDEP”), and EPA Region V (covering Ohio facilities) each conducted its own inspections, and the Company has separately received NOVs from WVDEP and EPA Region V related to similar issues being investigated by the EPA Region III.
−Removed: The Company continues to negotiate with EPA overall and WVDEP to resolve the issues alleged in the NOVs and the information request.
+Added: Separately, in June 2018, the Company received an information request from the EPA Region III pursuant to Section 114(a) of the Clean Air Act relating to the facilities that were inspected in September 2017 as well as additional Antero Resources facilities for the purpose of determining if the additional facilities have the same alleged compliance issues that were identified during the September 2017 inspections.
+Added: Subsequently, the West Virginia Department of Environmental Protection (“WVDEP”) and the EPA Region V (covering Ohio facilities) each conducted its own inspections, and the Company has separately received NOVs from WVDEP and EPA Region V related to similar issues being investigated by the EPA Region III.
+Added: The Company continues to negotiate with the EPA and WVDEP to resolve the issues alleged in the NOVs and the information request.
The Company’s operations at these facilities are not suspended, and management does not expect these matters to have a material adverse effect on the Company’s financial condition, results of operations or cash flows.
−Removed: ANTERO RESOURCES CORPORATION
−Removed: Notes to Consolidated Financial Statements (Continued)
In March 2015 and December 2017, the Company filed lawsuits against South Jersey Gas Company and South Jersey Resources Group, LLC (collectively, “SJGC”) in United States District Court in Colorado seeking relief for breach of contracts and damages for amounts that SJGC short paid the Company.
3 unchanged sentences
During the year ended December 31, 2019, the Company and its royalty owners received a gross settlement of $ 82 million from SJGC, which was in full satisfaction and discharge of judgments entered in favor of the Company in the above described lawsuits.
+Added: ANTERO RESOURCES CORPORATION
+Added: Notes to Consolidated Financial Statements (Continued)
The Company and Washington Gas Light Company and WGL Midstream, Inc.
10 unchanged sentences
In February 2021, the Company and its royalty owners received a gross payment of approximately $ 107 million from WGL, which was in full satisfaction and discharge of the June 2019 judgment entered in favor of the Company.
−Removed: The Company is party to various other legal proceedings and claims in the ordinary course of its business.
+Added: The Company is party to various other legal proceedings and claims in the ordinary course of its business, including, but not limited to, royalty claims.
The Company believes that certain of these matters will be covered by insurance and that the outcome of other matters will not have a material adverse effect on the Company’s consolidated financial position, results of operations or cash flows.
1 unchanged sentence
Antero Midstream Partners’ operations comprised substantially all of the operations reflected in the gathering and processing, and water handling and treatment, results through March 12, 2019.
−Removed: Effective March 13, 2019, Antero Resources accounts for Antero Midstream Corporation as an equity method investment.
−Removed: See Note 3—Deconsolidation of Antero Midstream Partners LP to the consolidated financial statements for more discussion on the Transactions.
−Removed: Substantially all of the revenues for Antero Midstream Partners or Antero Midstream Corporation were and are derived from transactions with Antero Resources.
−Removed: See Note 18—Segment Information to the consolidated financial statements for the operating results of the Company’s reportable segments.
−Removed: (18) Segment Information
−Removed: See Note 2(t)—Summary of Significant Accounting Policies—Industry Segments and Geographic Information to the consolidated financial statements for a description of the Company’s determination of its reportable segments.
−Removed: Revenues from midstream services were primarily derived from intersegment transactions for services provided to the Company’s exploration and production operations prior to the closing of the Transactions.
+Added: Effective March 13, 2019, Antero Resources accounts for Antero Midstream as an equity method investment.
+Added: See Note 3—Deconsolidation of Antero Midstream Partners LP to the consolidated financial statements for more discussion on the Simplification Transactions.
+Added: Substantially all of Antero Midstream Partners’ and Antero Midstream’s revenues were and are derived from transactions with Antero Resources.
+Added: See Note 18—Reportable Segments to the consolidated financial statements for the operating results of the Company’s reportable segments.
+Added: (18) Reportable Segments
+Added: See Note 2(t)—Summary of Significant Accounting Policies—Reportable Segments and Geographic Information to the consolidated financial statements for a description of the Company’s determination of its reportable segments.
+Added: Revenues from midstream services were primarily derived from intersegment transactions for services provided to the Company’s exploration and production operations prior to the closing of the Simplification Transactions.
Through March 12, 2019, Antero Resources included the results of Antero Midstream Partners in its consolidated financial statements.
1 unchanged sentence
however, the Company’s segment disclosures include the results of the Company’s unconsolidated affiliates due to their significance to the Company’s operations.
−Removed: See Note 3—Deconsolidation of Antero Midstream
−Removed: ANTERO RESOURCES CORPORATION
−Removed: Notes to Consolidated Financial Statements (Continued)
−Removed: Partners LP to the consolidated financial statements for further discussion on the Transactions.
+Added: See Note 3—Deconsolidation of Antero Midstream Partners LP to the consolidated financial statements for further discussion on the Simplification Transactions.
Marketing revenues are primarily derived from activities to purchase and sell third-party natural gas and NGLs and to market excess firm transportation capacity to third parties.
4 unchanged sentences
Intersegment sales were transacted at prices which approximate market.
−Removed: Accounting policies for each segment are the same as the Company’s accounting policies described in Note 2—Summary of Significant Accounting Policies to the consolidated financial statements.
−Removed: The operating results and assets of the Company’s reportable segments were as follows for the years ended December 31, 2018, 2019 and 2020 (in thousands):
−Removed: Elimination of
+Added: ANTERO RESOURCES CORPORATION
+Added: Notes to Consolidated Financial Statements (Continued)
+Added: policies for each segment are the same as the Company’s accounting policies described in Note 2—Summary of Significant Accounting Policies to the consolidated financial statements.
+Added: The operating results and assets of the Company’s reportable segments were as follows (in thousands):
Year Ended December 31, 2019
+Added: Equity Method
+Added: Elimination of
+Added: Investment in
+Added: Transactions and
+Added: Unconsolidated
+Added: Corporation (1)
Sales and revenues:
+Added: Total revenue
Operating expenses:
1 unchanged sentence
Gathering, compression, processing, and transportation
+Added: General and administrative
+Added: Depletion, depreciation, and amortization
Impairment of oil and gas properties
Impairment of midstream assets
−Removed: Depletion, depreciation, and amortization
−Removed: General and administrative
−Removed: Operating income (loss)
+Added: Total operating expenses
+Added: ( 1,261,890 )
+Added: Operating loss
Equity in earnings of unconsolidated affiliates
+Added: Investments in unconsolidated affiliates
Segment assets
1 unchanged sentence
Capital expenditures for segment assets
+Added: (1) Includes the consolidated results of Antero Midstream Partners through March 12, 2019 and results of the Company’s equity method investment in Antero Midstream effective March 13, 2019.
ANTERO RESOURCES CORPORATION
Notes to Consolidated Financial Statements (Continued)
+Added: Year Ended December 31, 2020
Equity Method
3 unchanged sentences
Unconsolidated
−Removed: Corporation (1)
−Removed: Year Ended December 31, 2019
Sales and revenues:
+Added: Total revenue
Operating expenses:
1 unchanged sentence
Gathering, compression, processing, and transportation
+Added: General and administrative
+Added: Depletion, depreciation, and amortization
Impairment of oil and gas properties
Impairment of midstream assets
−Removed: Depletion, depreciation, and amortization
−Removed: General and administrative
+Added: Total operating expenses
( 1,018,357 )
−Removed: Operating income (loss)
+Added: Operating loss
Equity in earnings (loss) of unconsolidated affiliates
3 unchanged sentences
Capital expenditures for segment assets
−Removed: (1) Includes the consolidated results of Antero Midstream Partners through March 12, 2019 and results of the Company’s equity method investment in Antero Midstream Corporation effective March 13, 2019.
−Removed: ANTERO RESOURCES CORPORATION
−Removed: Notes to Consolidated Financial Statements (Continued)
+Added: Year Ended December 31, 2021
Equity Method
3 unchanged sentences
Unconsolidated
−Removed: Year Ended December 31, 2020
Sales and revenues:
+Added: Total revenue
Operating expenses:
1 unchanged sentence
Gathering, compression, processing, and transportation
−Removed: Impairment of oil and gas properties
−Removed: Impairment of midstream assets
−Removed: Depletion, depreciation, and amortization
General and administrative
−Removed: ( 1,018,357 )
−Removed: Operating loss
−Removed: Equity in earnings (loss) of unconsolidated affiliates
+Added: Depletion, depreciation, and amortization
+Added: Impairment of oil and gas properties
+Added: Total operating expenses
+Added: Operating income (loss)
+Added: Equity in earnings of unconsolidated affiliates
Investments in unconsolidated affiliates
3 unchanged sentences
(19) Subsidiary Guarantors
−Removed: Each of the Company’s wholly owned subsidiaries has fully and unconditionally guaranteed Antero Resources’ senior notes.
−Removed: In the event a subsidiary guarantor is sold or disposed of (whether by merger, consolidation, the sale of a sufficient amount of its capital stock so that it no longer qualifies as a “Subsidiary” of Antero (as defined in the indentures governing the notes) or the sale of all or substantially all of its assets (other than by lease)) and whether or not the subsidiary guarantor is the surviving entity in such transaction to a person that is not Antero or a restricted subsidiary of Antero, such subsidiary guarantor will be released from its obligations under its subsidiary guarantee if the sale or other disposition does not violate the covenants set forth in the indentures governing the notes.
+Added: Antero Resources’ senior notes are fully and unconditionally guaranteed by Antero Resources’ existing subsidiaries that guarantee the Credit Facility.
+Added: In the event a subsidiary guarantor is sold or disposed of (whether by merger, consolidation, the sale of a sufficient amount of its capital stock so that it no longer qualifies as a “Subsidiary” of Antero (as defined in the indentures governing the notes) or the sale of all or substantially all of its assets (other than by lease)) and whether or not the subsidiary guarantor is the
+Added: ANTERO RESOURCES CORPORATION
+Added: Notes to Consolidated Financial Statements (Continued)
+Added: surviving entity in such transaction to a person that is not Antero or a restricted subsidiary of Antero, such subsidiary guarantor will be released from its obligations under its subsidiary guarantee if the sale or other disposition does not violate the covenants set forth in the indentures governing the notes.
In addition, a subsidiary guarantor will be released from its obligations under the indentures and its guarantee, upon the release or discharge of the guarantee of other Indebtedness (as defined in the indentures governing the notes) that resulted in the creation of such guarantee, except a release or discharge by or as a result of payment under such guarantee;
if Antero designates such subsidiary as an unrestricted subsidiary and such designation complies with the other applicable provisions of the indentures governing the notes or in connection with any covenant defeasance, legal defeasance or satisfaction and discharge of the notes.
−Removed: The following tables present summarized financial information of Antero and its guarantor subsidiaries.
+Added: The tables set forth below present summarized financial information of Antero, as parent, and its guarantor subsidiaries (in thousands).
The Company’s wholly owned subsidiaries are not restricted from making distributions to the Company.
−Removed: ANTERO RESOURCES CORPORATION
−Removed: Notes to Consolidated Financial Statements (Continued)
Balance Sheet
−Removed: Parent (Antero)
−Removed: (in thousands)
+Added: December 31, 2021
Accounts receivable, non-guarantor subsidiaries
10 unchanged sentences
Statement of Operations
−Removed: Parent (Antero)
−Removed: (in thousands)
+Added: December 31, 2021
Operating expenses
1 unchanged sentence
Net loss and comprehensive loss including noncontrolling interests
−Removed: ( 1,267,897 )
Net loss and comprehensive loss attributable to Antero Resources Corporation
−Removed: ( 1,267,897 )
−Removed: ANTERO RESOURCES CORPORATION
−Removed: Notes to Consolidated Financial Statements (Continued)
−Removed: (20) Quarterly Financial Information (Unaudited)
−Removed: The Company’s quarterly consolidated financial information for the years ended December 31, 2019 and 2020 is summarized in the tables below (in thousands, except per share amounts).
−Removed: The Company’s quarterly operating results are affected by the volatility of commodity prices and the resulting effect on the Company’s production revenues and the fair value of commodity derivatives.
−Removed: Year Ended December 31, 2019
−Removed: Total operating revenues
−Removed: Total operating expenses
−Removed: Operating income (loss)
−Removed: Gain on deconsolidation of Antero Midstream Partners LP
−Removed: Net income (loss) and comprehensive income (loss) including noncontrolling interest
−Removed: Net income attributable to noncontrolling interest
−Removed: Net income (loss) attributable to Antero Resources Corporation
−Removed: Earnings (loss) per common share—basic
−Removed: Earnings (loss) per common share—diluted
−Removed: Year Ended December 31, 2020
−Removed: Total operating revenues
−Removed: Total operating expenses
−Removed: Operating income (loss)
−Removed: Net income (loss) and comprehensive income (loss) including noncontrolling interest
−Removed: Net income (loss) attributable to noncontrolling interest
−Removed: Net income (loss) attributable to Antero Resources Corporation
−Removed: Earnings (loss) per common share—basic
−Removed: Earnings (loss) per common share—diluted
−Removed: Operating income is calculated as operating revenues minus operating expenses.
−Removed: During the third and fourth quarters of 2019, operating expenses were impacted by impairments for proved properties, unproved properties and equity method investments that were material to the quarters as presented.
−Removed: See Note 2—Summary of Significant Accounting Policies to the consolidated financial statement for more information.
(20) Supplemental Information on Oil and Gas Producing Activities (Unaudited)
−Removed: The following is supplemental information regarding the Company’s consolidated oil and gas producing activities.
+Added: The following tables set forth supplemental information regarding the Company’s consolidated oil and gas producing activities (in thousands).
The amounts shown include the Company’s net working interests in all of its oil and gas properties.
1 unchanged sentence
Year Ended December 31,
−Removed: (In thousands)
Proved properties
1 unchanged sentence
Total oil and gas properties
−Removed: Accumulated depletion and depreciation
+Added: Accumulated depletion
( 3,818,279 )
5 unchanged sentences
Year Ended December 31,
−Removed: (In thousands)
Acquisition costs:
6 unchanged sentences
Year Ended December 31,
−Removed: (In thousands)
Operating expenses:
1 unchanged sentence
Exploration expenses
−Removed: Depletion and depreciation
Impairment of unproved properties
3 unchanged sentences
(d) Oil and Gas Reserves
−Removed: The following table sets forth the net quantities of proved reserves and proved developed reserves during the periods indicated.
−Removed: This information includes the Company’s royalty and net working interest share of the reserves in oil and gas properties.
Net proved oil and gas reserves for the years ended December 31, 2019, 2020 and 2021 were prepared by the Company’s reserve engineers and audited by DeGolyer and MacNaughton (“D&M”) utilizing data compiled by the Company.
7 unchanged sentences
Proved undeveloped reserves include drilling locations that are more than one offset location away from productive wells and are reasonably certain of containing proved reserves and which are scheduled to be drilled within five years under the Company’s development plans.
−Removed: The Company’s development plans for drilling scheduled over the next five years are subject to many
+Added: The Company’s development plans for drilling scheduled over the next five years are subject to many uncertainties and variables, including availability of capital, future commodity prices, net cash provided by operating activities, future drilling and completion costs, and other economic factors.
+Added: The tables below set forth the changes in quantities of proved reserves and net quantities of proved developed and proved undeveloped reserves for the periods indicated.
+Added: This information includes the Company’s royalty and net working interest share of the reserves in oil and gas properties.
ANTERO RESOURCES CORPORATION
Notes to Consolidated Financial Statements (Continued)
−Removed: uncertainties and variables, including availability of capital, future commodity prices, net cash provided by operating activities, future drilling and completion costs, and other economic factors.
Proved reserves:
1 unchanged sentence
Extensions, discoveries and other additions
−Removed: Purchases of reserves
December 31, 2019
Extensions, discoveries and other additions
−Removed: Purchases of reserves
December 31, 2020 (1)
Extensions, discoveries and other additions
−Removed: Purchases of reserves
December 31, 2021 (1)
(1) Proved reserves for the noncontrolling interest in Martica as of December 31, 2020 were 254 Bcfe, which consists of 159 Bcf of natural gas, 15 MMBbl of NGLs and 0.5 MMBbl of oil and condensate.
+Added: Proved reserves for the noncontrolling interest in Martica as of December 31, 2021 were 167 Bcfe, which consists of 101 Bcf of natural gas, 11 MMBbl of NGLs and 0.4 MMBbl of oil and condensate.
Proved developed reserves:
7 unchanged sentences
(1) Proved developed reserves for the noncontrolling interest in Martica as of December 31, 2020 were 181 Bcfe, which consists of 110 Bcf of natural gas, 11 MMBbl of NGLs and 0.3 MMBbl of oil and condensate.
+Added: Proved developed reserves for the noncontrolling interest in Martica as of December 31, 2021 were 133 Bcfe, which consists of 78 Bcf of natural gas, 9 MMBbl of NGLs and 0.2 MMBbl of oil and condensate.
(2) Proved undeveloped reserves for the noncontrolling interest in Martica as of December 31, 2020 were 73 Bcfe, which consists of 49 Bcf of natural gas, 4 MMBbl of NGLs and 0.2 MMBbl of oil and condensate.
−Removed: Significant items included in the categories of proved developed and undeveloped reserve changes for the years ended December 31, 2018, 2019 and 2020 in the above table include the following:
−Removed: 2018 Changes in Reserves
−Removed: ● Extensions, discoveries, and other additions of 2,781 Bcfe resulted from delineation and development drilling in the Appalachian Basin.
−Removed: ● Net downward revisions of 1,042 Bcfe include:
−Removed: ● Downward revisions of 433 Bcfe related to well performance.
−Removed: ANTERO RESOURCES CORPORATION
−Removed: Notes to Consolidated Financial Statements (Continued)
−Removed: ● Net downward revisions of 742 Bcfe related to optimization to the Company’s five-year development plan.
−Removed: This figure includes upward revisions of 1,722 Bcfe for previously proved undeveloped properties reclassified from non-proved properties due to their addition to the Company’s five-year development plan, and downward revisions of 2,464 Bcfe for locations that were not developed within five years of initial booking as proved reserves.
−Removed: ● Upward revisions of 18 Bcfe were due to increases in prices for natural gas, NGLs, and oil.
−Removed: ● Upward revisions of 115 Bcfe are due to an increase in the Company’s assumed future ethane recovery.
−Removed: The Company produced 989 Bcfe during the year ended December 31, 2018.
−Removed: 2019 Changes in Reserves
+Added: Proved undeveloped reserves for the noncontrolling interest in Martica as of December 31, 2021 were 34 Bcfe, which consists of 23 Bcf of natural gas, 2 MMBbl of NGLs and 0.2 MMBbl of oil and condensate.
+Added: Significant changes in proved reserves for the years ended December 31, 2019, 2020 and 2021 include the following:
+Added: Year Ended December 31, 2019 Proved Reserve Changes
● Extensions, discoveries, and other additions of 3,705 Bcfe resulted from delineation and development drilling in the Appalachian Basin.
3 unchanged sentences
This figure includes upward revisions of 595 Bcfe for previously proved undeveloped properties reclassified from non-proved properties due to their addition to the Company’s five-year development plan, and downward revisions of 2,300 Bcfe for locations that were not developed within five years of initial booking as proved reserves.
+Added: ANTERO RESOURCES CORPORATION
+Added: Notes to Consolidated Financial Statements (Continued)
● Downward revisions of 157 Bcfe were due to increases in prices for natural gas, NGLs and oil.
3 unchanged sentences
Prior to deconsolidation, Antero Resources’ consolidated reserves included the elimination of full fees paid by Antero Resources to Antero Midstream Partners and the inclusion of the operating costs and capital incurred by Antero Midstream Partners.
−Removed: The Company produced 1,175 Bcfe during the year ended December 31, 2019.
−Removed: 2020 Changes in Reserves
+Added: Year Ended December 31, 2020 Proved Reserve Changes
● Extensions, discoveries, and other additions of 1,105 Bcfe resulted from delineation and development drilling in the Appalachian Basin.
5 unchanged sentences
● Net upward performance revisions of 491 Bcfe.
+Added: ● Sales of reserves of 113 Bcfe related to the VPP.
+Added: Year Ended December 31, 2021 Proved Reserve Changes
+Added: ● Extensions, discoveries, and other additions of 472 Bcfe resulted from delineation and development drilling in the Appalachian Basin.
+Added: ● Net upward revisions of 1,486 Bcfe include:
+Added: ● Upward revisions of 149 Bcfe due to increases in prices for natural gas, NGLs and oil.
+Added: ● Upward revisions of 121 Bcfe are due to an increase in the Company’s assumed future ethane recovery.
+Added: ● Net upward performance revisions of 565 Bcfe.
+Added: ● Net upward revision of 651 Bcfe related to optimization to the Company’s five-year development plan.
+Added: This figure includes upward revisions of 1,475 Bcfe for previously proved undeveloped properties reclassified from non-proved properties due to their addition to the Company’s five-year development plan, and downward revisions of 824 Bcfe for locations that were not developed within five years of initial booking as proved reserves.
+Added: ● Sales of reserves of 670 Bcfe related to the drilling partnership.
ANTERO RESOURCES CORPORATION
Notes to Consolidated Financial Statements (Continued)
−Removed: ● Sales of reserves of 113 Bcfe related to the VPP.
−Removed: The Company produced 1,310 Bcfe during the year ended December 31, 2020.
(e) Standardized Measure of Discounted Future Net Cash Flow
−Removed: The following table sets forth the standardized measure of the discounted future net cash flows attributable to the Company’s proved reserves.
+Added: The standardized measure relating to proved oil and reserves was prepared in accordance with the provisions of ASC 932.
Future cash inflows were computed by applying historical 12 month unweighted first day of the month average prices.
4 unchanged sentences
The resulting annual net cash inflows were then discounted using a 10 % annual rate.
+Added: The following table sets forth the Standardized Measure of the discounted future net cash flows attributable to the Company’s proved reserves (in millions):
Year Ended December 31,
−Removed: (in millions)
Future cash inflows
6 unchanged sentences
Standardized measure of discounted future net cash flows (2)
−Removed: (1) Based on the 12-month average of the first-day-of-the-month prices used in the computation of PV-10 as of December 31, 2020, the future taxable net income generated over the life of the Company’s proved reserves is expected to be less than its NOL carryforward deductions and therefore, under the standardized measure, there is no deduction for federal or state income taxes.
−Removed: (2) The standardized measure of discounted future net cash flows for the noncontrolling interest in Martica was $ 359 million for the year ended December 31, 2020.
+Added: (1) Based on the 12-month average of the first-day-of-the-month prices used in the computation of PV-10 as of December 31, 2020, the future taxable net income generated over the life of the Company’s proved reserves was expected to be less than its NOL carryforward deductions and therefore, under the standardized measure, there was no deduction for federal or state income taxes.
+Added: (2) The standardized measure of discounted future net cash flows for the noncontrolling interest in Martica was $ 359 million and $ 501 million for the years ended December 31, 2020 and 2021, respectively.
The Company used the following 12-month weighted average prices to estimate its total equivalent reserves (per Mcfe):
4 unchanged sentences
(f) Changes in Standardized Measure of Discounted Future Net Cash Flow
+Added: The changes in the Standardized Measure relating to proved oil and natural gas reserves, which were prepared in accordance with the provisions of ASC 932, are as follows (in millions):
Year Ended December 31,
−Removed: (in millions)
Sales of oil and gas, net of productions costs
12 unchanged sentences
(2) Includes $ 185 million in increased future development costs due to the deconsolidation of Antero Midstream Partners for the year ended December 31, 2019.
−Removed: (3) The standardized measure of discounted future net cash flows for the noncontrolling interest in Martica was $ 359 million for the year ended December 31, 2020.
+Added: (3) The standardized measure for the noncontrolling interest in Martica was $ 359 million and $ 501 million for the years ended December 31, 2020 and 2021, respectively.
Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.