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Item 9A. Controls and Procedures

2024-02-14 compared with 2023-02-15 · 350 added, 386 removed, 1428 unchanged (34% of the section changed)

2 unchanged sentences

As required by Rule 13a-15(b) under the Exchange Act, we have evaluated, under the supervision and with the participation of our management, including our principal executive officer and principal financial officer, the effectiveness of the design and operation of our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d- 15(e) under the Exchange Act) as of the end of the period covered by this Annual Report on Form 10-K.

Our disclosure controls and procedures are designed to provide reasonable assurance that the information required to be disclosed by us in reports that we file or submit under the Exchange Act is accumulated and communicated to our management, including our principal executive officer and principal financial officer, as appropriate, to allow timely decisions regarding required disclosures and is recorded, processed, summarized and reported, within the

time periods specified in the rules and forms of the SEC.

Based upon that evaluation, our principal executive officer and principal financial officer concluded that our disclosure controls and procedures were effective as of December 31, 2023 at a level of reasonable assurance.

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OTHER INFORMATION

Second Amended and Restated Bylaws

On February 14, 2023, the Board approved an amendment and restatement of the Company's bylaws (as amended and restated, the “A&R Bylaws”), effective as of such date.

Among other matters, the A&R Bylaws:

● revise procedures and disclosure requirements for the nomination of directors to address new Rule 14a-19 of the Exchange Act;

● clarify the advance notice procedures and requirements for a stockholder’s notice;

● make other minor administrative, modernizing, clarifying and conforming changes, including to better conform the A&R Bylaws to the DGCL.

The foregoing summary of the amendments to the Company’s bylaws does not purport to be complete and is qualified in its entirety by reference to the complete text of the A&R Bylaws, a copy of which is filed as Exhibit 3.2 to this Annual Report on Form 10-K and is incorporated herein by reference.

DISCLOSURE REGARDING FOREIGN JURISDICTIONS THAT PREVENT INSPECTIONS

22 unchanged sentences

001-36120) filed on October 17, 2013).

Second Amended and Restated Bylaws of Antero Resources Corporation, dated February 14, 2023.

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.

001-36120) filed on December 29, 2016).

Form of 5.0% Senior Note due 2025 (incorporated by reference to Exhibit 4.2 to the Company's Current Report on Form 8-K (Commission File No.

333-164876) filed on December 29, 2016).

First Supplemental Indenture related to the 5.0% Senior Notes due 2025, 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 4.4 to the Company’s Quarterly Report on Form 10-Q (Commission File No.

001-36120) filed on May 1, 2019).

Second Supplemental Indenture related to the 5.0% Senior Notes due 2025, 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 4.4 to the Company’s Quarterly Report on Form 10-Q (Commission File No.

001-36120) filed on July 29, 2020).

Certificate of Amendment to Second Amended and Restated Certificate of Incorporation of Antero Resources Corporation, dated June 8, 2023 (incorporated by reference to Exhibit 3.1 to the Company’s Current Report on Form 8-K (Commission File No.

001-36120) filed on June 8, 2023) .

Second Amended and Restated Bylaws of Antero Resources Corporation, dated February 14, 2023 (incorporated by reference to Exhibit 3.2 to the Company’s Annual Report on Form 10-K (Commission File No.

0001-36120) filed on February 15, 2023).

Indenture related to the 4.25% Convertible Senior Notes due 2026, dated as of August 21, 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 4.1 to the Company's Current Report on Form 8-K (Commission File No.

8 unchanged sentences

001-36120) filed on October 17, 2013).

Description of Securities Registered Under Section 12 of the Securities Exchange Act of 1934, as amended (incorporated by reference to Exhibit 4.20 to the Company’s Annual Report on Form 10-K (Commission File No.

001-36120) filed on February 12, 2020).

Indenture related to the 7.625% Senior Notes due 2029, dated as of January 26, 2021, by and among Antero Resources Corporation, the several guarantors named therein and Wells Fargo Bank, National Association, as trustee (incorporated

Description of Exhibit

by reference to Exhibit 4.1 to the Company’s Current Report on Form 8-K (Commission File No.

Description of Securities Registered Under Section 12 of the Securities Exchange Act of 1934, as amended.

001-36120) filed on February 1, 2021).

5 unchanged sentences

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.

Contribution Agreement, dated as of October 16, 2013, by and between Antero Resources Corporation and Antero

Description of Exhibit

Resources Midstream LLC (incorporated by reference to Exhibit 10.2 to the Company's Current Report on Form 8-K (Commission File No.

001-36120) filed on October 17, 2013).

25 unchanged sentences

001-36120) filed on February 25, 2015).

Global Amendment to Grant Notices and Award Agreements Under the Antero Resources Corporation Long-Term Incentive Plan (incorporated by reference to Exhibit 10.1 to the Company’s Quarterly Report on Form 10-Q

Description of Exhibit

(Commission File No.

001-36120) filed on October 26, 2016).

Form of Performance Share Unit Grant Notice and Performance Share Unit Agreement under the Antero Resources Corporation Long-Term Incentive Plan (incorporated by reference to Exhibit 10.1 to the Company’s Quarterly Report on Form 10-Q (Commission File No.

001-36120) filed on July 31, 2019).

Form of Stock Award Grant Notice and Stock Award Agreement (Form for Non-Employee Directors) under the Antero Resources Corporation 2020 Long-Term Incentive Plan (incorporated by reference to Exhibit 4.4 to the Company’s Current Report on Form S-8 (Commission File No.

5 unchanged sentences

001-36120) filed on October 10, 2018).

Description of Exhibit

Registration Rights Agreement, dated March 12, 2019, by and among Antero Midstream Corporation, the Company, Arkrose Subsidiary Holdings LLC, Glen C.

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Federal Mine Safety and Health Act Information.

Antero Resources Corporation Incentive Compensation Recovery Policy .

Report of DeGolyer and MacNaughton, dated as of January 17, 2024, for proved reserves as of December 31, 2023.

Report of DeGolyer and MacNaughton, dated as of January 17, 2023, for proved reserves as of December 31, 2022 (incorporated by reference to Exhibit 99.1 to the Company’s Annual Report on Form 10-K (Commission File No.

Description of Exhibit

001-36120) filed on February 15, 2023).

1 unchanged sentence

001-36120) filed on February 16, 2022).

Description of Exhibit

The following financial information from this Form 10-K of Antero Resources Corporation for the year ended December 31, 2023, formatted in iXBRL (Inline eXtensible Business Reporting Language):

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The communication of a critical audit matter does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates.

Estimated oil and gas reserves on depletion expense related to proved oil and gas properties

Estimated oil and gas reserves impact on depletion expense related to proved oil and gas properties

As discussed in Note 2 to the consolidated financial statements, the Company calculates depletion expense related to proved oil and gas properties using the units-of-production method.

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For the year ended December 31, 2023, the Company recorded depletion expense related to proved oil and gas properties of $682 million.

Estimating proved oil and gas reserves requires the expertise of professional petroleum reservoir engineers, who take into consideration forecasted production, operating cost assumptions and estimated proved oil and gas reserves, and the Company engages external reservoir engineering specialists to perform an independent evaluation of those proved oil and gas reserve estimates.

Estimating proved oil and gas reserves requires the expertise of professional petroleum reservoir engineers, who take into consideration forecasted production and operating cost assumptions.

The Company engages external reservoir engineering specialists to perform an independent evaluation of those proved oil and gas reserve estimates.

We identified the assessment of the impact of estimated oil and gas reserves on depletion expense related to proved oil and gas properties as a critical audit matter.

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Derivative instruments

Prepaid expenses and other current assets

Prepaid expenses

Other current assets

Total current assets

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authorized - 1,000,000 shares;

313,930 shares issued and outstanding as of December 31, 2021, and 297,393 shares issued and 297,359 shares outstanding as of December 31, 2022

297,393 shares issued and 297,359 shares outstanding as of December 31, 2022, and 303,544 shares issued and outstanding as of December 31, 2023

Additional paid-in capital

Retained earnings (accumulated deficit)

Retained earnings

Treasury stock, at cost;

zero shares and 34 shares as of December 31, 2021and 2022, respectively

34 shares and zero shares as of December 31, 2022 and 2023, respectively

Total stockholders' equity

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Amortization of deferred revenue, VPP

Other revenue and income

Total revenue

3 unchanged sentences

Production and ad valorem taxes

Exploration and mine expenses

General and administrative (including equity-based compensation expense of $ 20,437 , $ 35,443 and $ 59,519 in 2021, 2022 and 2023, respectively)

2 unchanged sentences

Accretion of asset retirement obligations

Contract termination

Contract termination and loss contingency

Loss (gain) on sale of assets

Other operating expense

Total operating expenses

Operating income (loss)

Operating income

Other income (expense):

Interest expense, net

Equity in earnings (loss) of unconsolidated affiliate

Gain (loss) on early extinguishment of debt

Loss on convertible note inducement and equitizations

Impairment of equity method investment

Equity in earnings of unconsolidated affiliate

Loss on early extinguishment of debt

Loss on convertible note inducements and equitizations

Transaction expense

1 unchanged sentence

Income (loss) before income taxes

( 1,657,893 )

Income tax benefit (expense)

Net income (loss) and comprehensive income (loss) including noncontrolling interests

( 1,260,411 )

net income and comprehensive income attributable to noncontrolling interests

Net income (loss) and comprehensive income (loss) attributable to Antero Resources Corporation

( 1,267,897 )

Income (loss) per share—basic

Income (loss) per share—diluted

Weighted average number of shares outstanding:

Net income (loss) per common share—basic

Net income (loss) per common share—diluted

Weighted average number of common shares outstanding:

See accompanying notes to consolidated financial statements.

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Balances, December 31, 2020

Issuance of common shares

Issuance of common units in Martica Holdings, LLC

1 unchanged sentence

Issuance of common stock upon vesting of equity-based compensation awards, net of shares withheld for income taxes

Distributions to noncontrolling interests

Repurchases and retirements of common stock

Equity-based compensation

Distributions to noncontrolling interests

Net income (loss) and comprehensive income (loss)

( 1,267,897 )

( 1,260,411 )

Balances, December 31, 2021

Issuance of common shares

Issuance of common units in Martica Holdings, LLC

Equity component of 2026 Convertible Notes, net

Issuance of common stock upon vesting of equity-based compensation awards, net of shares withheld for income taxes

Conversion of 2026 Convertible Notes

Repurchases and retirements of common stock

Equity-based compensation

Distributions to noncontrolling interests

Net income (loss) and comprehensive income (loss)

Net income and comprehensive income

Balances, December 31, 2022

Equity component of 2026 Convertible Notes, net

Issuance of common stock upon vesting of equity-based compensation awards, net of shares withheld for income taxes

12 unchanged sentences

Net income (loss) including noncontrolling interests

( 1,260,411 )

Adjustments to reconcile net income (loss) to net cash provided by operating activities:

1 unchanged sentence

Commodity derivative fair value losses (gains)

Settled commodity derivative gains (losses)

Losses on settled commodity derivatives

( 1,183,400 )

( 1,911,065 )

Proceeds from (payments for) derivative monetizations

Payments for derivative monetizations

Deferred income tax expense (benefit)

Equity-based compensation expense

Equity in (earnings) loss of unconsolidated affiliate

Equity in earnings of unconsolidated affiliate

Dividends of earnings from unconsolidated affiliate

Amortization of deferred revenue

Amortization of debt issuance costs, debt discount, debt premium and other

Amortization of debt issuance costs, debt discount and other

Settlement of asset retirement obligations

Contract termination and loss contingency

Loss (gain) on sale of assets

(Gain) loss on early extinguishment of debt

Loss on convertible note inducement and equitizations

Loss on early extinguishment of debt

Loss on convertible note inducements and equitizations

Changes in current assets and liabilities:

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Accrued revenue

Prepaids and other current assets

Prepaid expenses and other current assets

Accounts payable including related parties

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Additions to other property and equipment

Settlement of water earnout

Proceeds from asset sales

Proceeds from VPP sale, net

Change in other assets

1 unchanged sentence

Net cash used in investing activities

( 1,140,767 )

Cash flows provided by (used in) financing activities:

1 unchanged sentence

Issuance of senior notes

Issuance of convertible notes

Repayment of senior notes

1 unchanged sentence

( 1,027,559 )

Borrowings on Credit Facility

Repayments on Credit Facility

( 6,023,000 )

Borrowings (repayments) on bank credit facilities, net

( 6,274,100 )

( 4,119,000 )

Payment of debt issuance costs

2 unchanged sentences

Employee tax withholding for settlement of equity compensation awards

Convertible note inducement and equitizations

Net cash used in financing activities

Convertible note inducements and equitizations

Net cash provided by (used in) financing activities

( 2,107,730 )

2 unchanged sentences

Cash and cash equivalents, end of period

Year Ended December 31,

Supplemental disclosure of cash flow information:

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The Company accounts for its interest in Antero Midstream Corporation (“Antero Midstream”) using the equity method of accounting.

As of December 31, 2021 and 2022, the Company had a 29.1 % interest in Antero Midstream.

As of December 31, 2022 and 2023, the Company had 29.1 % and 29.0 % , respectively, interest in Antero Midstream.

Investments in entities for which the Company exercises significant influence, but not control, are accounted for under the equity method.

1 unchanged sentence

Such investments are included in Investment in unconsolidated affiliate on the Company’s consolidated balance sheets.

Income (loss) from investees that are accounted for under the equity method is included in Equity in earnings (loss) of unconsolidated affiliate on the Company’s consolidated statements of operations and cash flows.

When Antero records its proportionate share of net income or net loss, it is recorded in equity in earnings (loss) of unconsolidated affiliate in the statements of operations and the carrying value of that investment on the Company’s balance sheet.

When Antero records its proportionate share of net income or net loss, it is recorded in equity in earnings (loss) of unconsolidated affiliate in the statements of operations and comprehensive income (loss) and the carrying value of that investment on the Company’s balance sheet.

When a distribution is received, it is recorded as a reduction to the carrying value of that investment on the Company’s balance sheet.

1 unchanged sentence

See Note 5—Equity Method Investments to the consolidated financial statements for further discussion on equity method investments.

The Company accounts for distributions received from equity method investees under the “nature of the distribution”

ANTERO RESOURCES CORPORATION

Notes to Consolidated Financial Statements (Continued)

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).

52 unchanged sentences

Debt issuance costs represent loan origination fees and other initial borrowing costs.

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 7—Long-Term Debt).

These costs are amortized over the term of the related debt instrument.

4 unchanged sentences

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.

In order to manage its exposure to natural gas, NGLs and oil price volatility, the Company may enter into derivative transactions from time to time, which contracts may include commodity fixed price swaps, basis swaps, collars and other similar agreements related to the price risk associated with the Company’s production.

To the extent legal right of offset exists with a counterparty, the Company reports derivative assets and liabilities on a net basis.

The Company has exposure to credit risk to the extent that the counterparty is unable to satisfy its settlement obligations.

Cash flows from derivative instruments are classified in operating activities on the Company’s consolidated statements of cash flows.

The Company actively monitors the creditworthiness of counterparties and assesses the impact, if any, on its derivative positions.

The Company records derivative instruments on the consolidated balance sheets as either assets or liabilities measured at fair value and records changes in the fair value of derivatives in current earnings as they occur.

Changes in the fair value of commodity

The Company records derivative instruments on the consolidated balance sheets as either assets or liabilities measured at fair

ANTERO RESOURCES CORPORATION

Notes to Consolidated Financial Statements (Continued)

derivatives, including gains or losses on settled derivatives, are classified as revenues on the Company’s consolidated statements of operations.

value and records changes in the fair value of derivatives in current earnings as they occur.

Changes in the fair value of commodity derivatives, including gains or losses on settled derivatives, are classified as revenues on the Company’s consolidated statements of operations and comprehensive income (loss).

The Company’s derivatives have not been designated as hedges for accounting purposes.

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The Company transfers control of the product at the delivery point and recognizes revenue based on the contract price.

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.

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The Company recognizes revenue based on the contract price when it transfers control of the product to a purchaser.

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.

ANTERO RESOURCES CORPORATION

Notes to Consolidated Financial Statements (Continued)

Marketing Revenues and Expenses

2 unchanged sentences

The Company has concluded that it is the principal in these arrangements and therefore, the Company recognizes revenue on a gross basis, with costs to purchase and transport natural gas and NGLs presented as marketing expenses.

Contracts to sell third-party gas and NGLs are generally subject to similar terms as contracts to sell the Company’s produced natural gas and

ANTERO RESOURCES CORPORATION

Notes to Consolidated Financial Statements (Continued)

Contracts to sell third-party gas and NGLs are generally subject to similar terms as contracts to sell the Company’s produced natural gas and NGLs.

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.

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.

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 and comprehensive income (loss).

Marketing expenses include the cost of purchased third-party natural gas and NGLs.

2 unchanged sentences

Deferred Revenue

Under the terms of the VPP (as defined below in Note 3—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.

Under the terms of the Company’s volumetric production payment transaction (“VPP”), 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.

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 3—Transactions to the consolidated financial statements for further discussion of the VPP.

Concentrations of Credit Risk

2 unchanged sentences

The Company has not experienced significant credit losses on its receivables.

The Company’s sales to major customers (purchases in excess of 10% of total sales) are as follows:

Year Ended December 31,

Six One Commodities LLC (1)

Sabine Pass Liquefaction LLC

(1) Six One Commodities LLC acquired WGL Midstream during the year ended December 31, 2021.

WGL Midstream was the Company's major customer during the year ended December 31, 2020.

Sabine Pass Liquefaction LLC was not a major customer during the years ended December 31, 2021 and 2022.

The Company’s sales to Six One Commodities LLC accounted for 10 % and 12 % of total sales for the years ended December 31, 2021 and 2022, respectively.

No customer accounted for more than 10% of the Company’s sales for the year ended December 31, 2023.

The Company is also exposed to credit risk on its commodity derivative portfolio.

Any default by the counterparties to these derivative contracts when they become due could have a material adverse effect on the Company’s financial condition and results of operations.

The Company has economic hedges in place with four different counterparties.

As of December 31, 2022, the Company did not have any commodity derivative assets with bank counterparties under our Credit Facility (as defined below in Note 7—Long-Term Debt).

The Company has economic hedges in place with three different counterparties.

As of December 31, 2023, the Company did not have any commodity derivative assets with bank counterparties under our Credit Facility.

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, 2023 for the counterparty.

1 unchanged sentence

The Company, at times, may have cash in banks in excess of federally insured amounts.

The Company recognizes deferred tax assets and liabilities for temporary differences resulting from NOL carryforwards for income tax purposes and the differences between the financial statement and tax basis of assets and liabilities.

The Company recognizes deferred income tax assets and liabilities for temporary differences resulting from NOL carryforwards for income tax purposes and the differences between the financial statement and tax basis of assets and liabilities.

The effect of changes in tax laws or tax rates is recognized in income during the period such changes are enacted.

Deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is more likely than not that some portion, or all, of the deferred tax assets will not be realized.

On July 8, 2022, Pennsylvania enacted new tax laws that are effective January 1, 2023 on a prospective basis that

Deferred income tax assets are reduced by a valuation allowance when, in the opinion of management, it is more likely than not that some portion, or all, of the deferred income tax assets will not be realized.

On July 8, 2022, Pennsylvania enacted new tax laws that are effective January 1, 2023 on a prospective basis that reduce the state’s corporate income tax rate.

As a result of this tax law change together with changes in the Company’s apportionment to Pennsylvania, the Company’s net deferred income tax liability was reduced by $ 41 million with a corresponding income tax benefit during the year ended December 31, 2022.

ANTERO RESOURCES CORPORATION

Notes to Consolidated Financial Statements (Continued)

reduce the state’s corporate income tax rate.

Unrecognized tax benefits represent potential future tax obligations for uncertain tax positions taken on previously filed tax returns that may not ultimately be sustained.

9 unchanged sentences

Level 2 inputs are data, other than quoted prices included within Level 1, which are observable for the asset or liability, either directly or indirectly.

Instruments that are valued using Level 2 inputs include non-exchange traded derivatives such as over-the- counter commodity price swaps.

Instruments that are valued using Level 2 inputs include non-exchange traded derivatives such as over-the- counter commodity fixed price swaps.

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.

7 unchanged sentences

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.

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.

Earnings (loss) per common share—diluted for each period is computed after giving consideration to the potential dilution from (i) outstanding equity awards using the treasury stock method and (ii) shares of common stock issuable upon conversion of the 2026 Convertible Notes (as defined below in Note 7—Long-Term Debt) using the if-converted method.

Net Income (Loss) Per Common Share

Net income (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.

Net income (loss) per common share—diluted for each period is computed after giving consideration to the potential dilution from (i) outstanding equity awards using the treasury stock method and (ii) shares of common stock issuable upon conversion of the 2026 Convertible Notes using the if-converted method.

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.

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 the year ended December 31, 2020, and (ii) if-converted method for the years ended December 31, 2021 and 2022, as a result of the partial equitizations of the 2026 Convertible Notes during the year ended December 31, 2021 and the adoption of ASU No.

2020-06 (as defined below) on January 1, 2022.

See Note 7—Long-Term Debt for further discussion on the equitization transactions.

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.

During periods in which the Company incurs a net loss, diluted weighted average shares outstanding is 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

Notes to Consolidated Financial Statements (Continued)

The following is a reconciliation of the Company’s earnings (loss) attributable to common stockholders for basic and diluted earnings (loss) per share (in thousands):

The following is a reconciliation of the Company’s income (loss) attributable to common stockholders for basic and diluted net income (loss) per common share (in thousands):

Year Ended December 31,

Net income (loss) attributable to Antero Resources Corporation—common shareholders

( 1,267,897 )

Interest expense for 2026 Convertible Notes

1 unchanged sentence

Net income (loss) attributable to Antero Resources Corporation—common shareholders and assumed conversions

( 1,267,897 )

Income (loss) per share—basic

Income (loss) per share—diluted

Net income (loss) per common share—basic

Net income (loss) per common share—diluted

Weighted average common shares outstanding—basic

2 unchanged sentences

Year Ended December 31,

Basic weighted average number of shares outstanding

Basic weighted average number of common shares outstanding

Dilutive effect of RSUs

1 unchanged sentence

Dilutive effect of 2026 Convertible Notes

Diluted weighted average number of shares outstanding

Weighted average number of outstanding securities excluded from calculation of diluted earnings per common share (1) :

Diluted weighted average number of common shares outstanding

Weighted average number of outstanding securities excluded from calculation of diluted net income (loss) per common share (1) :

Stock options

2026 Convertible Notes

(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.

(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.

As of December 31, 2020, the conversion value did not exceed the principal amount of the notes.

On January 12, 2021, the Company completed the January Equitization Transactions (defined below in Note 7—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 7—Long-Term Debt to the consolidated financial statements for further discussion on this transaction.

(1) The potential dilutive effects of these awards were excluded from the computation of net income (loss) per common share—diluted because the inclusion of these awards would have been anti-dilutive.

Treasury Stock and Share Retirement

5 unchanged sentences

The Company recognizes compensation cost related to all equity-based awards in the financial statements based on their estimated grant date fair value.

The Company is authorized to grant various types of equity-based compensation awards including

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.

Compensation cost is recognized ratably over the applicable vesting

ANTERO RESOURCES CORPORATION

Notes to Consolidated Financial Statements (Continued)

stock options, stock appreciation rights, restricted stock awards, restricted share unit awards, performance share unit awards, dividend equivalent awards and other types of awards.

Compensation cost is recognized ratably over the applicable vesting or service period.

or service period.

Forfeitures are accounted for as they occur by reversing the expense previously recognized for awards that were forfeited during the period.

See Note 9 —Equity-Based Compensation and Cash Awards to the consolidated financial statements for more information regarding the Company’s equity-based compensation.

Recently Issued Accounting Standards

See Note 9 —Equity-Based Compensation to the consolidated financial statements for more information regarding the Company’s equity-based compensation.

Recently Adopted or Issued Accounting Standards

Convertible Debt Instruments

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Upon adoption of this new standard, the Company reclassified $ 24 million, net of deferred income taxes and equity issuance costs, from additional paid-in capital and increased long-term debt by $ 27 million, reduced deferred income tax liability by $ 6 million and reduced accumulated deficit by $ 3 million as of January 1, 2022.

Additionally, annual interest expense for the 2026 Convertible Notes beginning January 1, 2022 is based on an effective interest rate of 4.9 % as compared to 15.3 % for the years ended December 31, 2020 and 2021.

Additionally, annual interest expense for the 2026 Convertible Notes beginning January 1, 2022 is based on an effective interest rate of 4.9 % as compared to 15.3 % for the year ended December 31, 2021.

In December 2019, the FASB issued ASU No.

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The Company adopted this ASU on January 1, 2021, and it did not have a material impact on the Company's consolidated financial statements.

In December 2023, the FASB issued ASU No.

2023-09, Improvements to Income Tax Disclosures (“ASU 2023-09”).

ASU 2023-09 is intended to improve income tax disclosures primarily through enhanced disclosure of income tax rate reconciliation items, and disaggregation of income (loss) from continuing operations, income tax expense (benefit) and income taxes paid, net disclosures by federal, state and foreign jurisdictions, among others.

This ASU is effective for annual reporting periods beginning after December 15, 2024, and early adoption is permitted.

ASU 2023-07 should be applied on a prospective basis, although retrospective application is permitted.

The Company is evaluating the impact that ASC 2023-09 will have on the consolidated financial statements and its plans for adoption, including the adoption date and transition method.

Reportable Segments

In November 2023, the FASB issued ASU No.

2023-07, Improvements to Reportable Segment Disclosures (“ASU 2023-07”).

ASU 2023-07 is intended to improve reportable segment disclosures primarily through enhanced disclosure of reportable segment expenses.

This ASU is effective for annual reporting periods beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024.

Early adoption is permitted.

ASU 2023-07 is required to be applied retrospectively to all prior periods presented in the financial statements.

The Company is evaluating the impact that ASU 2023-07 will have on the consolidated financial statements and its plans for adoption, including the adoption date .

(3) Transactions

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On June 15, 2020, the Company announced the consummation of a transaction with an affiliate of Sixth Street Partners, LLC (“Sixth Street”) relating to certain overriding royalty interests across the Company’s existing asset base (the “ORRIs”).

In connection with the transaction, the Company contributed the ORRIs to Martica and Sixth Street contributed $ 300 million in cash (subject to customary adjustments) and agreed to contribute up to an additional $ 102 million in cash if certain production thresholds attributable to the ORRIs are achieved in the third quarter of 2020 and first quarter of 2021.

All cash contributed by Sixth Street at the initial closing was distributed to the Company.

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.

The Company received a $ 51 million cash distribution during each of the years ended December 31, 2020 and 2021.

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”).

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 Company met these production thresholds and received the $ 102 million of additional contributions from Sixth Street during 2020 and 2021.

All cash contributed by Sixth Street at the initial closing and received as part of these additional contributions was distributed to the Company.

ANTERO RESOURCES CORPORATION

Notes to Consolidated Financial Statements (Continued)

As of April 1, 2023, Sixth Street no longer had the right to participate in any new wells, and Martica reconveyed the Development Override to the Company, except for the portion relating to wells turned to sales prior to April 1, 2023.

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”).

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Any portion of the Incremental Override that may not be re-conveyed to the Company based on the Company failing to achieve such production volumes through March 31, 2023 will remain with Martica.

Prior to Sixth Street achieving an internal rate of return of 13 % and 1.5 x cash-on-cash return (the “Hurdle”), Sixth Street will receive all distributions in respect of the Initial PDP Override and the Development Override, and the Company will receive all distributions in respect of the Incremental Override, unless certain production targets are not achieved, in which case Sixth Street will receive some or all of the distributions in respect of the Incremental Override.

As of March 31, 2023, 24 % of the Incremental Override (or a 0.48 % overriding royalty interest) will remain with Martica.

Prior to Sixth Street achieving an internal rate of return of 13 % and 1.5 x cash-on-cash return (the “Hurdle”), Sixth Street will receive all distributions in respect of the Initial PDP Override and the Development Override, and 24 % of all distributions in respect of the Incremental Override, and the Company will receive 76 % of all distributions in respect of the Incremental Override.

Following Sixth Street achieving the Hurdle, the Company will receive 85 % of the distributions in respect of the ORRIs to which Sixth Street was entitled immediately prior to the Hurdle being achieved.

The conveyance of the ORRIs from the Company to Martica was accounted for as a transaction between entities under common control.

As a result, the contributed ORRIs have been recorded by Martica at their historical cost.

Volumetric Production Payment Transaction

On August 10, 2020, the Company completed a volumetric production payment transaction and received net proceeds of approximately $ 216 million (the "VPP").

In connection with the VPP, the Company entered into a purchase and sale agreement, together with a conveyance agreement and production and marketing agreement, with J.P.

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.

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.

Under the production and marketing agreement, Antero and its affiliates provide certain marketing services as JPM-VEC’s agent, and any income or expenses related to these services will be recorded as marketing revenue or marketing expenses as appropriate.

Contemporaneously with the VPP, the Company executed a call option related to the production volumes associated with its retained interest in the VPP Properties, which is collateralized by a mortgage on the VPP Properties.

Additionally, the production and marketing agreement contains an embedded put option related to the production volumes for the Company’s retained interest in the VPP Properties, which has been bifurcated from the production and marketing arrangement and accounted for as a derivative instrument recorded at fair value.

See Note 11—Derivative Instruments to the consolidated financial statements for more information on the Company’s derivative instruments.

Drilling Partnership

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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.

For 2021, 2022 and 2023, Antero Resources and QL agreed to the estimated IRR of the Company’s capital budget for each annual tranche, and QL agreed to participate in the 2021, 2022 and 2023 tranches.

For 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.

For 2021 through 2024, Antero Resources and QL agreed to the estimated IRR of the Company’s capital budget for each annual tranche, and QL agreed to participate in all four annual tranches.

Antero Resources develops and manages the drilling program associated with each tranche, including the selection of wells.

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 percentage in each well spud in that year, which conveyances will not be subject to any reversion.

Under the terms of the arrangement, QL funded 20 % and 15 % of development capital for wells spud in 2021 and 2022, respectively, will fund development capital of (i) 15 % in for wells spud in 2023 and (ii) if they participate in 2024, between 15 % and 20 % for wells spud in 2024, which funding amounts represent QL’s proportionate working interest in such wells.

Additionally, for each annual tranche, Antero Resources and QL will enter into assignments, bills of sale and conveyances pursuant to which QL will be conveyed a proportionate working interest percentage in each well spud in that year, which conveyances will not be subject to any reversion.

Under the terms of the arrangement, QL funded development capital of 20 %, 15 % and 15 % for wells spud in 2021, 2022 and 2023, respectively, and will fund 20 % of development capital for wells spud in 2024, which funding amounts represent QL’s proportionate working interest in such wells.

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 than December 1 following the end of each tranche year.

During the year ended December 31, 2022, the Company received a carry of $ 29 million attributable to the 2021

ANTERO RESOURCES CORPORATION

Notes to Consolidated Financial Statements (Continued)

The Company received a carry of $ 29 million for each of the 2021 and 2022 tranches during the years ended December 31, 2022 and 2023.

All of the wells spud during each calendar year period will be a separate annual tranche.

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No gain or loss was recognized for the interests conveyed during the years ended December 31, 2021, 2022 and 2023.

ANTERO RESOURCES CORPORATION

Notes to Consolidated Financial Statements (Continued)

Disaggregation of Revenue

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Exploration and production

Other revenue

Exploration and production

Total revenue from contracts with customers

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(a) Summary of Equity Method Investment

As of December 31, 2021 and 2022, 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.

As of December 31, 2022 and 2023, Antero owned 29.1 % and 29.0 %, respectively, of Antero Midstream’s common stock, which is reflected in Antero’s consolidated financial statements using the equity method of accounting.

The following table sets forth a reconciliation of Antero’s investment in unconsolidated affiliate (in thousands):

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Operating expenses

Income (loss) from operations

Net income (loss)

Income from operations

ANTERO RESOURCES CORPORATION

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Credit Facility (a)

5.00 % senior notes due 2025 (d)

8.375 % senior notes due 2026 (e)

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Total principal

Unamortized discount, net

Unamortized debt issuance costs

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Antero Resources has a senior secured revolving credit facility with a consortium of bank lenders.

On October 26, 2021, Antero Resources entered into an amended and restated senior secured revolving credit facility (the “Credit Facility”).

On October 26, 2021, Antero Resources entered into an amended and restated 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.

As of December 31, 2022, the borrowing base under the Credit Facility was $ 3.5 billion and lender commitments were $ 1.5 billion.

As of December 31, 2022 and 2023, the Credit Facility had a borrowing base of $ 3.5 billion with lender commitments of $ 1.5 billion and $ 1.6 billion, respectively.

The borrowing base was re-affirmed in the semi-annual redetermination in October 2023 and the next redetermination of the borrowing base is scheduled to occur in April 2024.

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The Credit Facility provides for interest only payments until maturity at which time all outstanding borrowings are due.

Interest was payable at a variable rate based on LIBOR or the Alternative Base Rate (as defined in the agreement), determined

Interest was payable at a variable rate based on LIBOR or the Alternative Base Rate (as defined in the agreement), determined by election at the time of borrowing, plus an applicable margin rate under the Credit Facility in effect prior to October 26, 2021.

Interest is payable at a variable rate based on SOFR or the Alternate Base Rate, determined by election at the time of borrowing, plus an applicable margin rate under the Credit Facility on or after October 26, 2021.

Interest at the time of borrowing is determined with

ANTERO RESOURCES CORPORATION

Notes to Consolidated Financial Statements (Continued)

by election at the time of borrowing, plus an applicable margin rate under the Credit Facility in effect prior to October 26, 2021.

Interest at the time of borrowing is determined with reference to the Antero Resources’ then-current leverage ratio subject to certain exceptions.

reference to the Antero Resources’ then-current leverage ratio subject to certain exceptions.

Commitment fees on the unused portion of the Credit Facility are due quarterly at rates ranging from 0.375 % to 0.500 % with respect to the Credit Facility, determined with reference to borrowing base utilization subject to certain exceptions based on the leverage ratio then in effect.

The 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 Credit Facility).

As of December 31, 2021, Antero Resources had no borrowings under the Credit Facility and had outstanding letters of credit of $ 531 million.

As of December 31, 2022, Antero Resources had an outstanding balance under the Credit Facility of $ 35 million, with a weighted average interest rate of 6.42 %, and outstanding letters of credit of $ 504 million.

As of December 31, 2023, Antero Resources had an outstanding balance under the Credit Facility of $ 417 million, with a weighted average interest rate of 7.71 %, and outstanding letters of credit of $ 501 million.

5.125 % Senior Notes Due 2022

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On January 4, 2021, Antero Resources issued $ 500 million of 8.375 % senior notes due July 15, 2026 (the “2026 Notes”) at par .

The Company redeemed $ 175 million principal amount of the 2026 Notes on July 1, 2021 and redeemed or repurchased $ 228 million principal amount of the 2026 Notes during the year ended December 31, 2022, and as of December 31, 2022, $ 97 million principal amount of the 2026 Notes remained outstanding.

The Company redeemed $ 175 million principal amount of the 2026 Notes on July 1, 2021 and redeemed or otherwise repurchased $ 228 million principal amount of the 2026 Notes during the year ended December 31, 2022, and as of December 31, 2023, $ 97 million principal amount of the 2026 Notes remained outstanding.

See “—Debt Repurchase Program” below for more information.

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On January 26, 2021, Antero Resources issued $ 700 million of 7.625 % senior notes due February 1, 2029 (the “2029 Notes”) at par.

The Company redeemed $ 116 million of the 2029 Notes during the year ended December 31, 2021 and repurchased $ 177 million of the 2029 Notes during the year ended December 31, 2022, and as of December 31, 2022, $ 407 million principal amount of

The Company redeemed or otherwise repurchased $ 116 million principal amount of the 2029 Notes during the year ended December 31, 2021 and repurchased $ 177 million of the 2029 Notes during the year ended December 31, 2022, and as of December 31, 2023, $ 407 million principal amount of the 2029 Notes remained outstanding.

See “—Debt Repurchase Program”

ANTERO RESOURCES CORPORATION

Notes to Consolidated Financial Statements (Continued)

the 2029 Notes remained outstanding.

See “—Debt Repurchase Program” below for more information.

below for more information.

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.

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On September 2, 2020, Antero Resources issued an additional $ 37.5 million of the 2026 Convertible Notes.

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 2026 Convertible Notes.

During the year ended December 31, 2022, $ 20 million aggregate principal amount of the 2026 Convertible Notes were converted pursuant to their terms, and an additional $ 5 million aggregate principal amount of the 2026 Convertible Notes were induced into conversion by the Company.

The Company elected to settle these conversions by issuing approximately 6 million shares of common stock to the noteholders together with a cash inducement premium of $ 0.2 million.

Proceeds from the issuance of the 2026 Convertible Notes totaled $ 278.5 million, net of initial purchasers’ fees and issuance cost of $ 9 million.

The Company extinguished $ 206 million principal amount of the 2026 Convertible Notes in 2021.

In addition, during 2022 and 2023, $ 55 million aggregate principal amount of the 2026 Convertible Notes were converted pursuant to their terms or induced into conversion by the Company.

See “—Equitizations, Conversions and Inducements,” for more information.

As of December 31, 2023, $ 26 million principal amount of the 2026 Convertible Notes remained outstanding.

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The 2026 Convertible Notes bear interest at a fixed rate of 4.25 % per annum, payable semi-annually in arrears on March 1 and September 1 of each year, commencing on March 1, 2021.

Proceeds from the issuance of the 2026 Convertible Notes totaled $ 278.5 million, net of initial purchasers’ fees and issuance cost of $ 9 million.

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.

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Before May 1, 2026, noteholders will have the right to convert their 2026 Convertible Notes only upon the occurrence of the following events:

● 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

ANTERO RESOURCES CORPORATION

Notes to Consolidated Financial Statements (Continued)

● 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;

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 Sales Price per share of common stock on such Trading Day and the conversion rate on such Trading Day;

● 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;

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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.

This equity component was recorded, net of deferred taxes and issuance costs, in additional paid-in capital within the consolidated balance sheet and statement of stockholders’ equity.

This equity component was recorded, net of deferred income taxes and issuance costs, in additional paid-in capital within the consolidated balance sheet and statement of stockholders’ equity.

Transaction costs related to the 2026 Convertible Notes issuance were allocated to the liability and equity components based on their relative fair values.

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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.

Effective January 1, 2022, the Company adopted ASU 2020-06 whereby the Company reclassified the equity component of the 2026 Convertible Notes outstanding on such date, net of deferred income taxes and equity issuance costs, from additional paid-in

See Note 2—Summary of Significant Accounting Policies to the consolidated financial statements.

ANTERO RESOURCES CORPORATION

Notes to Consolidated Financial Statements (Continued)

capital to long-term debt.

See Note 2—Summary of Significant Accounting Policies to the unaudited condensed consolidated financial statements.

Partial Equitizations of 2026 Convertible Notes

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.

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”).

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.

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.

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.

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.

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”).

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.

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.

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.

The 2026 Convertible Notes consist of the following (in thousands):

Liability component:

unamortized note discount (1)

unamortized debt issuance costs

Net carrying value

Equity component (1)

(1) 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.

Upon adoption of ASU 2020-06 on January 1, 2022, the equity component was reclassified from additional paid-in capital to long-term debt and fully offset the remaining discount on the 2026 Convertible Notes.

See Note 2—Summary of Significant Accounting Policies to the consolidated financial statements.

Interest expense recognized on the 2026 Convertible Notes related to the stated interest rate, amortization of the debt discount and debt issuance costs totaled $ 11 million, $ 3 million and $ 2 million for the years ended December 31, 2021, 2022 and 2023, respectively.

Debt Repurchase Program

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.

The Company recognized a gain of approximately $ 176 million for the year ended December 31, 2020 on the early extinguishment of

Equitizations, Conversions and Inducements

Equitizations

The Company used the proceeds from the January Share Offering and $ 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”).

The 2026 Convertible Notes had a 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.

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 income (loss) for the year ended December 31, 2021 for the consideration paid in excess of the original terms of the 2026 Convertible Notes.

Additionally, the January Equitization Transactions resulted in a loss on early extinguishment of debt of $ 41 million in the consolidated statements of operations and comprehensive income (loss) for the year ended December 31, 2021.

The Company used the proceeds from the May Share Offering and $ 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”).

The 2026 Convertible Notes had a 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.

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 income (loss) for the year ended December 31, 2021 for the consideration paid in excess of the original terms of the 2026 Convertible Notes.

Additionally, the May Equitization Transactions resulted in a loss on early extinguishment of debt of $ 21 million in the consolidated statements of operations and comprehensive income (loss) for the year ended December 31, 2021.

Conversions and Inducements

The Company elected to settle these conversions by issuing approximately 6 million shares of common stock to the noteholders together with a cash inducement premium of $ 0.2 million.

During the year ended December 31, 2023, $ 9 million aggregate principal amount of the 2026 Convertible Notes were converted pursuant to their terms, and an additional $ 21 million aggregate principal amount of the 2026 Convertible Notes were induced into conversion by the Company.

The Company elected to settle these conversions by issuing 7 million shares of common stock to the noteholders together with a cash inducement premium of $ 0.4 million.

ANTERO RESOURCES CORPORATION

Notes to Consolidated Financial Statements (Continued)

the debt repurchased.

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 %.

Debt Repurchase Program

During the year ended December 31, 2021, the Company redeemed or repurchased through open market transactions (i) the remaining $ 661 million aggregate principal amount of its 2022 Notes at par, plus accrued and unpaid interest, (ii) the remaining $ 574 million aggregate principal amount of the 2023 Notes at par, plus accrued and unpaid interest, (iii) $ 5 million aggregate principal amount of its 2025 Notes at a weighted average redemption price of 102 % of the principal amount thereof, plus accrued and unpaid interest, (iv) $ 175 million aggregate principal amount of its 2026 Notes at a redemption price of 108.375 % of the principal amount thereof, plus accrued and unpaid interest and (v) $ 116 million aggregate principal amount of its 2029 Notes at a redemption price of 107.625 % of the principal amount thereof, plus accrued and unpaid interest.

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For such redemptions and repurchases, the Company recognized a $ 46 million loss on early extinguishment of debt.

There were no debt redemptions or repurchases during the year ended December 31, 2023.

(8) Asset Retirement Obligations

The following table presents a reconciliation of the Company’s asset retirement obligations (in thousands):

Year Ended December 31,

Beginning balance

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Ending balance

Revisions to prior estimates in 2021 and 2022 are primarily due to increases in estimated well lives.

Revisions to prior estimates during the years ended December 31, 2022 and 2023 are primarily due to increases in estimated well lives.

Asset retirement obligations are included in Other liabilities on the Company’s consolidated balance sheets.

(9) Equity-Based Compensation and Cash Awards

(9) Equity-Based Compensation

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.

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Antero Resources deconsolidated Antero Midstream Partners on March 12, 2019, and on such date, 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”).

Each RSU award under the AM Plan represents a right to receive one share of Antero Midstream common stock.

Each RSU award under the AM Plan represented a right to receive one share of Antero Midstream common stock.

As of December 31, 2023, all Converted AM RSU Awards were fully vested.

The Company’s equity-based compensation expense, by type of award, is as follows (in thousands):

5 unchanged sentences

Antero Resources allocates a portion of equity-based compensation expense related to grants prior March 13, 2019 (date of deconsolidation) to Antero Midstream Partners based on its proportionate share of Antero Resources’ labor costs.

As of December 31, 2023, all Converted AM RSU Awards were fully vested, and there is no remaining unamortized expense attributable to these awards

The total fair value of the Company’s vested equity awards for the years ended December 31, 2021, 2022 and 2023 were $ 34 million, $ 158 million and $ 75 million, respectively.

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Total awarded and unvested—December 31, 2023

As of December 31, 2022, there was approximately $ 55 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 2.4 years.

As of December 31, 2023, there was $ 57 million of unamortized equity-based compensation expense related to unvested RSUs.

That expense is expected to be recognized over a weighted average period of 1.8 years.

ANTERO RESOURCES CORPORATION

2 unchanged sentences

Performance Share Unit Awards Based on Total Shareholder Return

In 2017, the Company granted PSUs to certain of its employees and executive officers that would vest based on the total shareholder return (“TSR”) of Antero Resources’ common stock relative to the TSR of a peer group of companies over a three-year performance period.

The number of shares of common stock that were available to be earned ranged from zero to 200 % of the PSUs granted.

Expense related to these PSUs was recognized on a straight-line basis over three years .

Forfeitures were accounted for as they occurred by reversing the expense previously recognized for awards that were forfeited during the period.

The performance conditions for the 2017 PSUs were not met, and no vesting was achieved.

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 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”).

4 unchanged sentences

The performance conditions for the 2018 TSR PSUs were not met, and no vesting for these awards 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.

The number of shares of common stock which may ultimately be earned ranges from zero to 200 % of the PSUs granted.

Expense related to these PSUs is recognized on a straight-line basis over three years .

Forfeitures are accounted for as they occur by reversing the expense previously recognized for awards that were forfeited during the period.

During 2022, the market-based performance condition for the 2019 Absolute TSR PSUs was met at 200 % of target and the 2019 Absolute TSR PSUs were converted into approximately 2 million shares of common stock.

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.

The number of shares of common stock that may ultimately be earned following the end of the cumulative three-year performance period ranges from zero to 150 % of the target number of PSUs granted.

Expense related to these PSUs is recognized on a graded-vested basis over approximately three years .

Forfeitures are accounted for as they occur by reversing the expense previously recognized for awards that were forfeited during the period.

The performance conditions for the performance periods ending April 15, 2021 and April 15, 2022 were met, and 150 % vesting was achieved for these award tranches.

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.

The number of shares of common stock that may ultimately be earned following the end of the cumulative three-year performance period ranges from zero to 150 % of the target number of PSUs granted.

Expense related to these PSUs is recognized on a graded-vested basis over approximately three years .

Forfeitures are accounted for as they occur by reversing the expense previously recognized for awards that were forfeited during the period.

The performance condition for the performance periods ending April 15, 2021 and April 15, 2022 were met, and 150 % vesting was achieved for these award tranches.

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.

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.

In 2019, the Company granted PSUs to certain of its employees and executive officers that vested 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 (“2019 Absolute TSR PSUs”).

The number of shares of common stock which could ultimately be earned ranged from zero to 200 % of the PSUs granted.

Expense related to these PSUs was recognized on a straight-line basis over three years .

Forfeitures were accounted for as they occurred by reversing the expense previously recognized for awards that were forfeited during the period.

During 2022, the market-based performance condition for the 2019 Absolute TSR PSUs was met at 200 % of target and were converted into approximately 2 million shares of common stock.

In 2020, the Company granted PSU awards to certain of its executive officers that vested 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 (“2020 Absolute TSR PSUs”).

The number of shares of common stock that could ultimately be earned following the end of the cumulative three-year performance period ranged from zero to 150 % of the target number of PSUs granted.

Expense related to these PSUs was recognized on a graded-vested basis over approximately three years .

Forfeitures were accounted for as they occurred by reversing the expense previously recognized for awards that were forfeited during the period.

The performance conditions for each of the performance periods ended April 15, 2021, 2022 and 2023 were met.

During 2023, the 2020 Absolute TSR PSUs vested at 112 % of target for all four performance periods and were converted into approximately 0.2 million shares of common stock.

Additionally, in 2020, the Company granted PSUs to certain of its executive officers that vested 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 (“2020 Relative TSR PSUs”).

The number of shares of common stock that could ultimately be earned following the end of the cumulative three-year performance period ranged from zero to 150 % of the target number of PSUs granted.

Expense related to these PSUs was recognized on a graded-vested basis over approximately three years .

Forfeitures were accounted for as they occur by reversing the expense previously recognized for awards that were forfeited during the period.

The performance condition for each of the performance periods ended April 15, 2021, 2022 and 2023 were met.

During 2023, the 2020 Relative TSR PSUs vested at 126 % of target for all four performance periods and were converted into approximately 0.2 million shares of common stock.

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 2021 Absolute TSR PSUs ranges from zero to 200 % of the target number of 2021 Absolute TSR PSUs originally granted.

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

Forfeitures are accounted for as they occur by reversing the expense previously recognized for awards that were forfeited during the period.

The performance condition for the performance period ended April 15, 2022 was met, and 200 % vesting was achieved for this award tranche.

The performance condition for the performance period ended April 15, 2023 was not met, and as a result, no vesting for this award tranche was achieved.

ANTERO RESOURCES CORPORATION

Notes to Consolidated Financial Statements (Continued)

forfeited during the period.

The performance condition for the performance period ending April 15, 2022 was met, and 200 % vesting was achieved for this award tranche.

In 2022, the Company granted PSU awards to certain of its senior management and 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, 2023, April 15, 2024 and April 15, 2025, and one cumulative three-year performance period ending on April 15, 2025, in each case, subject to certain continued employment criteria (“2022 Absolute TSR PSUs”).

2 unchanged sentences

Forfeitures are accounted for as they occur by reversing the expense previously recognized for awards that were forfeited during the period.

Additionally, in 2022, the Company granted PSU awards to certain of its senior management and 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 December 31, 2023, December 31, 2024 and December 31, 2025, and one cumulative three-year performance period ending on December 31, 2025, in each case, subject to certain continued employment criteria (“2023 Absolute TSR PSUs”).

The performance condition for the performance period ended April 15, 2023 was not met, and as a result, no vesting for this award tranche was achieved.

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 Special 2022 Absolute TSR PSUs ranges from zero to 200 % of the target number of Special 2022 Absolute TSR PSUs originally granted.

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.

The performance condition for the performance period ended December 31, 2023 was not met, and as a result, no vesting for this award tranche was achieved.

In 2023, the Company granted PSU awards to certain of its senior management and 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 March 7, 2024, March 7, 2025 and March 7, 2026, and one cumulative three-year performance period ending on March 7, 2026, in each case, subject to certain continued employment criteria (“2023 Absolute TSR PSUs”).

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 2023 Absolute TSR PSUs ranges from zero to 200 % of the target number of 2023 Absolute TSR PSUs originally granted.

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Performance Share Unit Awards Based on Leverage Ratio

In 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 (“2021 Leverage Ratio PSUs”).

The number of shares of common stock that may ultimately be earned following the end of the third performance period with respect to the 2021 Leverage Ratio PSUs ranges from zero to 200 % of the target number of 2021 Leverage Ratio PSUs originally granted.

Expense related to the 2021 Leverage Ratio PSUs is recognized on a graded-vested basis over the term of each performance period that reflects 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.

The performance conditions for the performance periods ending December 31, 2021 and December 31, 2022 were met, and 200 % vesting was achieved for these award tranches.

As of December 31, 2022, the likelihood of achieving the performance conditions related to the Leverage Ratio PSUs was probable.

In 2021, the Company granted PSUs to certain of its executive officers that vested 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 (“2021 Leverage Ratio PSUs”).

The number of shares of common stock that could ultimately be earned following the end of the third performance period with respect to the 2021 Leverage Ratio PSUs ranged from zero to 200 % of the target number of 2021 Leverage Ratio PSUs originally granted.

Expense related to the 2021 Leverage Ratio PSUs was recognized on a graded-vested basis over the term of each performance period that reflects 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.

The performance conditions for the performance periods ended December 31, 2021, 2022 and 2023 were met at 200 % of target.

During the first quarter of 2024, the 2021 Leverage Ratio PSUs vested and converted into approximately 0.4 million shares of common stock.

In 2022, the Company granted PSUs to certain of its senior management and 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, 2022, December 31, 2023 and December 31, 2024, in each case, subject to certain continued employment criteria (“2022 Leverage Ratio PSUs”).

1 unchanged sentence

Expense related to the 2022 Leverage Ratio PSUs is recognized on a graded-vested basis over the term of each performance period that reflects 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.

The performance condition for the performance period ending December 31, 2022 was met, and 200 % vesting was achieved for this award tranche.

The performance conditions for the performance periods ended December 31, 2022 and 2023 were met, and 200 % vesting was achieved for these award tranches.

As of December 31, 2023, the likelihood of achieving the performance conditions related to the 2022 Leverage Ratio PSUs was probable.

Additionally, in 2022, the Company granted PSUs to certain of its senior management and 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, 2023, December 31, 2024 and December 31, 2025, in each case, subject to certain continued employment criteria (“2023 Leverage Ratio PSUs”).

The number of shares of common stock that may ultimately be earned following the end of the third performance period with respect to the 2023 Leverage Ratio PSUs ranges from zero to 200 % of the target number of 2023 Leverage Ratio PSUs originally granted.

Expense related to the 2023 Leverage Ratio PSUs is recognized on a graded-vested basis over the term of each performance period that reflects the number of shares of common stock that are expected to be issued at the end of each measurement period, and such expense is

ANTERO RESOURCES CORPORATION

Notes to Consolidated Financial Statements (Continued)

reversed if the likelihood of achieving the performance condition becomes improbable.

Additionally, in 2022, the Company granted PSUs to certain of its senior management and 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, 2023, December 31, 2024 and December 31, 2025, in each case, subject to certain continued employment criteria (“Special 2022 Leverage Ratio PSUs”).

The number of shares of common stock that may ultimately be earned following the end of the third performance period with respect to the Special 2022 Leverage Ratio PSUs ranges from zero to 200 % of the target number of Special 2022 Leverage Ratio PSUs originally granted.

Expense related to the Special 2022 Leverage Ratio PSUs is recognized on a graded-vested basis over the term of each performance period that reflects 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.

The performance condition for the performance period ended December 31, 2023 was met, and 200 % vesting was achieved for this award tranche.

As of December 31, 2023, the likelihood of achieving the performance conditions related to the Special 2022 Leverage Ratio PSUs was probable.

In 2023, the Company granted PSUs to certain of its senior management and 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, 2023, December 31, 2024 and December 31, 2025, in each case, subject to certain continued employment criteria (“2023 Leverage Ratio PSUs”).

The performance condition for the performance period ended December 31, 2023 was met, and 200 % vesting was achieved for this award tranche.

As of December 31, 2023, the likelihood of achieving the performance conditions related to the 2023 Leverage Ratio PSUs was probable.

1 unchanged sentence

A summary of PSU activity is as follows:

Average Grant

Date Fair Value

Total awarded and unvested—December 31, 2022

( 1,210,712 )

Total awarded and unvested—December 31, 2023

(1) During the year ended December 31, 2023, the PSUs granted in 2020 that were based on absolute TSR and relative TSR met the performance criteria to achieve vesting at 112 % and 126 % of target, respectively, and converted into approximately 0.4 million shares of the Company’s common stock.

The grant-date fair values of market-based PSUs were determined using Monte Carlo simulations, which use a probabilistic approach for estimating the fair values of the awards.

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A dividend yield of zero was assumed.

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.

The grant-date fair value for the 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.

The weighted average grant date fair value per share for PSUs granted during the years ended December 31, 2021, 2022 and 2023 were $ 9.71 , $ 37.96 and $ 28.51 , respectively.

ANTERO RESOURCES CORPORATION

Notes to Consolidated Financial Statements (Continued)

The following table presents information regarding the weighted average fair values for market-based PSUs, and the assumptions used to determine the fair values:

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Risk-free interest rate

Weighted average fair value of awards granted—Absolute TSR

Weighted average fair value of awards granted—Relative TSR

Weighted average fair value of awards granted

As of December 31, 2023, there was $ 19 million of unamortized equity-based compensation expense related to unvested PSUs.

That expense is expected to be recognized over a weighted average period of approximately 1.9 years.

That expense is expected to be recognized over a weighted average period of 1.5 years.

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On March 12, 2019, the Board of Directors of Antero Midstream adopted the AM Plan, and as a result, 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.

ANTERO RESOURCES CORPORATION

Notes to Consolidated Financial Statements (Continued)

A summary of the Converted AM RSU Awards is as follows:

1 unchanged sentence

Total awarded and unvested—December 31, 2023

As of December 31, 2022, there was less than $ 0.1 million of unamortized equity-based compensation expense related to unvested Converted AM RSU Awards.

That expense is expected to be recognized during the first quarter of 2023, and the Company’s proportionate share will be allocated to it as it is recognized.

As of December 31, 2023, all Converted AM RSU Awards were fully vested resulting in no unamortized equity-based compensation expense related to unvested Converted AM RSU Awards.

(d) Stock Options

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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)

A summary of stock option activity is as follows:

10 unchanged sentences

A dividend yield of zero was assumed.

(e) Cash Awards

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.

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 .

As of December 31, 2021 and 2022, the Company has recorded approximately $ 2 million and $ 1 million, respectively, in Other liabilities in the consolidated balance sheets related to unvested cash awards.

(10) Fair Value

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The carrying values of the amounts outstanding under the Credit Facility as of December 31, 2022 and 2023 approximated fair value because the variable interest rates are reflective of current market conditions.

ANTERO RESOURCES CORPORATION

Notes to Consolidated Financial Statements (Continued)

The following table sets forth the fair value and carrying value of the Senior Notes and 2026 Convertible Notes (in thousands):

December 31, 2022

December 31, 2023

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.

See Note 9—Equity-Based Compensation and Cash Awards to the consolidated financial statements for information regarding the fair value of derivative financial instruments.

(2) Carrying values are presented net of unamortized debt issuance costs.

See Note 9—Equity-Based Compensation to the consolidated financial statements for information regarding the fair value of equity based awards.

See Note 11—Derivative Instruments to the consolidated financial statements for information regarding the fair value of derivative financial instruments.

ANTERO RESOURCES CORPORATION

Notes to Consolidated Financial Statements (Continued)

(11) Derivative Instruments

The Company is exposed to certain risks relating to its ongoing business operations, and it uses derivative instruments to manage its commodity price risk.

The Company is exposed to certain risks relating to its ongoing business operations, and it may use derivative instruments to manage its commodity price risk.

In addition, the Company periodically enters into contracts that contain embedded features that are required to be bifurcated and accounted for separately as derivatives.

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The Company was party to various fixed price commodity swap contracts that settled during the years ended December 31, 2021, 2022 and 2023.

As of December 31, 2023, the Company has no fixed price commodity swap contracts.

The Company enters into these swap contracts when management believes that favorable future sales prices for the Company’s production can be secured.

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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.

As of December 31, 2022, the Company’s fixed price swap positions excluding Martica, the Company’s consolidated VIE were as follows:

Commodity / Settlement Period

Contracted Volume

January-December 2023

ANTERO RESOURCES CORPORATION

Notes to Consolidated Financial Statements (Continued)

therefore, all gains and losses are recognized in the Company’s statements of operations and comprehensive income (loss).

The Company has a call option and an embedded put option tied to NYMEX pricing for the production volumes associated with the Company’s retained interest in the VPP properties.

The put option was embedded within another contract, and since the embedded put option was not clearly and closely related to its host contract, the Company bifurcated this derivative instrument and reflects it at fair value in the unaudited condensed consolidated financial statements.

As of December 31, 2023, the Company’s call option and embedded put option arrangements were as follows:

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January-December 2026

As of December 31, 2023, 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:

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January-December 2024

In addition, the Company had a swaption agreement, which entitled 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.

In January 2023, the Company executed an early settlement of this swaption agreement and made a cash payment of $ 202 million.

In addition, the Company had a swaption agreement, which entitled 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/d at a price of $ 2.77 per MMBtu for the year ending December 31, 2024.

In 2023, the Company executed an early settlement of this swaption agreement and made a cash payment of $ 202 million.

ANTERO RESOURCES CORPORATION

Notes to Consolidated Financial Statements (Continued)

As of December 31, 2023, the Company’s fixed price swap positions for Martica, the Company’s consolidated VIE, were as follows:

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January-December 2024

January-March 2025

Natural Gasoline

January-December 2024

Mont Belvieu Natural Gasoline-OPIS Non-TET

January-December 2023

West Texas Intermediate

January-December 2024

West Texas Intermediate

January-March 2025

West Texas Intermediate

ANTERO RESOURCES CORPORATION

Notes to Consolidated Financial Statements (Continued)

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

Balance Sheet Location

Asset derivatives not designated as hedges for accounting purposes:

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(1) The fair value of derivative instruments was determined using Level 2 inputs.

(2) 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.

(2) As of December 31, 2022, $ 47 million of commodity derivative liabilities, including $ 28 million of current commodity derivatives and $ 19 million of noncurrent commodity derivatives, are attributable to the Company’s consolidated VIE, Martica.

As of December 31, 2023, approximately $ 5 million of commodity derivative liabilities, including $ 3 million of current commodity derivatives and $ 2 million of noncurrent commodity derivatives, are attributable to the Company’s consolidated VIE, Martica.

1 unchanged sentence

December 31, 2022

December 31, 2023

Net Amounts of

Amounts Offset

(Liabilities) on

Balance Sheet

Commodity derivative assets

Embedded derivative assets

Commodity derivative liabilities

December 31, 2022

Net Amounts of

Amounts Offset

1 unchanged sentence

Balance Sheet

Commodity derivative assets

3 unchanged sentences

Notes to Consolidated Financial Statements (Continued)

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):

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 and comprehensive income (loss) (in thousands):

Year Ended December 31,

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(1) The fair value of derivative instruments was determined using Level 2 inputs .

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.

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.

There were no commodity derivatives monetizations during the year ended December 31, 2022.

The Company’s commodity derivative position presented in Note 11(a) above reflects the volume and adjusted fixed price indices after the 2020 and 2021 monetizations.

Commodity derivative fair value gains (losses) for the years ended December 31, 2021 and 2023 include losses of $ 5 million and $ 202 million related to the settlement of certain natural gas derivatives prior to the contractual settlement dates.

Payments for these early settlements are classified as operating cash flows on the Company’s consolidated statement of cash flows for the years ended December 31, 2021 and 2023.

There were no early settlements of commodity derivatives during the year ended December 31, 2022.

The Company’s commodity derivative position presented in Note 11(a) above reflects the volume and adjusted fixed price indices after the 2021 and 2023 early settlements of certain natural gas derivatives.

The Company leases certain office space, processing plants, drilling rigs and completion services, gas gathering lines, compressor stations, and other office and field equipment.

6 unchanged sentences

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.

For any contract deemed to include a leased asset, that asset is capitalized on the balance sheet as a right-of-use asset and a corresponding lease liability is recorded at the present value of the known future minimum payments of the contract using a discount rate on the date of commencement.

For any contract deemed to include a leased asset, that asset is capitalized on the consolidated balance sheet as a right-of-use asset and a corresponding lease liability is recorded at the present value of the known future minimum payments of the contract using a discount rate on the date of commencement.

The leased asset classification is determined at the date of recording as either operating or financing, depending upon certain criteria of the contract.

23 unchanged sentences

Total operating lease right-of-use assets

Short-term operating lease obligation

Operating lease liabilities:

Short-term operating lease liabilities

Short-term lease liabilities

Long-term operating lease obligation

Long-term operating lease liabilities

Long-term lease liabilities

Total operating lease obligation

Total operating lease liabilities

Finance Leases

2 unchanged sentences

Total finance lease right-of-use assets (2)

Short-term finance lease obligation

Finance lease liabilities:

Short-term finance lease liabilities

Short-term lease liabilities

Long-term finance lease obligation

Long-term finance lease liabilities

Long-term lease liabilities

Total finance lease obligation

(1) Gas gathering lines and compressor stations includes $ 1.5 billion and $ 1.4 billion of leases related to Antero Midstream as of December 31, 2021 and 2022, respectively.

Total finance lease liabilities

(1) Gas gathering lines and compressor stations includes $ 1.4 billion and $ 1.3 billion related to Antero Midstream as of December 31, 2022 and 2023, respectively.

See “—Related party lease disclosure” for additional discussion.

(2) Financing lease assets are recorded net of accumulated amortization of approximately $ 2 million and $ 1 million as of 2021 and 2022, respectively.

(2) Financing lease assets are recorded net of accumulated amortization of $ 1 million as of December 31, 2022 and 2023.

The processing plants, gathering lines and compressor stations that are classified as lease liabilities are classified as such under ASC 842, Leases , because Antero (i) is the sole customer of the assets and (ii) makes the decisions that most impact the economic performance of the assets.

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(b) Supplemental Information Related to Leases

Costs associated with operating and finance leases were included in the consolidated statement of operations and comprehensive loss (in thousands):

Costs associated with operating and finance leases were included in the consolidated financial statements as follows (in thousands):

Year Ended December 31,

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Increase (decrease) to existing right-of-use assets and lease obligations from operating lease modifications, net (1)

(1) 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.

(1) 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.

During the year ended December 31, 2022, the weighted average discount rate for remeasured operating leases decreased from 5.6 % as of December 31, 2021 to 5.2 % as of December 31, 2022.

During the year ended December 31, 2023, the weighted average discount rate for remeasured operating leases increased from 5.1 % as of December 31, 2022 to 6.5 % as of December 31, 2023.

ANTERO RESOURCES CORPORATION

18 unchanged sentences

The Company has gathering and compression service agreements with Antero Midstream that include:

(i) the second amended and restated gathering and compression agreement dated December 8, 2019 (the “2019 gathering and compression agreement”), (ii) gathering and compression agreements from Antero Midstream’s acquisition of certain Marcellus gathering and compression assets (the “Marcellus gathering and compression agreements”) and (iii) a compression agreement from Antero Midstream’s acquisition of certain Utica compressors (the “Utica compression agreement” and, together with the 2019 gathering and compression agreement and the Marcellus gathering and compression agreements, the “gathering and compression agreements”).

(i) the second amended and restated gathering and compression agreement dated December 8, 2019 (the “2019 gathering and compression agreement”), (ii) a gathering and compression agreement from Antero Midstream’s acquisition of certain Marcellus gathering and compression assets (the “Marcellus gathering and compression agreement”) and (iii) a compression agreement from Antero Midstream’s acquisition of certain Utica compressors (the “Utica compression agreement” and, together with the 2019 gathering and compression agreement and the Marcellus gathering and compression agreement, the “gathering and compression agreements”).

Pursuant to the gathering and compression agreements with Antero Midstream, the Company has dedicated substantially all of its current and future acreage in West Virginia, Ohio and Pennsylvania to Antero Midstream for gathering and compression services.

The 2019 gathering and compression agreement has an initial term through 2038, the Marcellus gathering and compression agreements expire between 2024 and 2031, and the Utica compression agreement has two dedicated areas that expire in 2024 and 2030.

Upon expiration of each of the Marcellus gathering and compression service agreements and the Utica compression agreement, Antero Midstream will continue to provide gathering and compression services under the 2019 gathering and compression agreement.

Under the gathering and compression agreements, Antero Midstream receives a low-pressure gathering fee per Mcf, a high-pressure gathering fee per Mcf and a compression fee per Mcf, as applicable, subject to annual adjustments based on the consumer price index.

The 2019 gathering and compression agreement has an initial term through 2038, the Marcellus gathering and compression agreement expires in 2031 and the Utica compression agreement has two dedicated areas that expire in 2024 and 2030.

Upon expiration of each of the Marcellus gathering and compression agreement and the Utica compression agreement, Antero Midstream will continue to provide gathering and compression services under the 2019 gathering and compression agreement.

Under the gathering and compression agreements, Antero Midstream receives a low pressure gathering fee per Mcf, a high pressure gathering fee per Mcf and a compression fee per Mcf, as applicable, subject to annual adjustments based on CPI.

If and to the extent the Company requests that Antero Midstream construct new low pressure lines, high pressure lines and compressor stations, the 2019 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 the requested 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 .

The 2019 gathering and compression agreement includes a growth incentive fee program whereby low-pressure gathering fees will be reduced from 2020 through 2023 to the extent the Company achieves certain quarterly volumetric targets.

The Company’s throughput on acquired assets is not considered in low pressure gathering volume targets.

Upon completion of the initial contract term, the 2019 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.

The Company earned fee rebates for the years

In addition, the Marcellus gathering and compression agreement provides for a minimum volume commitment that requires the Company to utilize or pay for 25 % of the compression capacity for a period of 10 years from the in-service date.

The 2019 gathering and compression agreement includes a growth incentive fee program whereby low pressure gathering fees were reduced during the years ended December 31, 2021, 2022 and 2023 to the extent the Company achieved certain quarterly volumetric targets.

The Company’s throughput gathered under the Marcellus gathering and compression assets acquired by Antero Midstream was not considered in low pressure gathering volume targets.

Upon completion of the initial contract term, the 2019 gathering and compression agreement will continue in effect from year to year until such time as the agreement is terminated,

ANTERO RESOURCES CORPORATION

Notes to Consolidated Financial Statements (Continued)

ended December 31, 2020, 2021 and 2022 of $ 48 million, $ 12 million and $ 48 million, respectively.

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.

The Company earned fee rebates for the years ended December 31, 2021, 2022 and 2023 of $ 12 million, $ 48 million and $ 52 million, respectively.

The growth incentive fee program expired on December 31, 2023.

For the years ended December 31, 2021, 2022 and 2023, gathering and compression fees paid by Antero related to these agreements were $ 705 million, $ 660 million and $ 738 million, respectively.

As of December 31, 2021 and 2022, $ 54 million and $ 59 million, respectively was included within Accounts payable, related parties, on the consolidated balance sheet as due to Antero Midstream related to these agreements.

As of December 31, 2022 and 2023, $ 59 million and $ 65 million, respectively was included within Accounts payable, related parties, on the consolidated balance sheets as due to Antero Midstream related to these agreements.

(13) Income Taxes

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Year Ended December 31,

Current income tax expense (benefit)

Current income tax expense

Deferred income tax expense (benefit)

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Total income tax expense (benefit)

ANTERO RESOURCES CORPORATION

Notes to Consolidated Financial Statements (Continued)

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.

The tax effect of the temporary differences giving rise to net deferred tax assets and liabilities is as follows (in thousands):

Deferred tax assets:

The tax effect of the temporary differences giving rise to deferred income tax assets and liabilities is as follows (in thousands):

Deferred income tax assets:

NOL carryforwards

Interest expense carryforwards

Equity-based compensation

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Unrealized losses on derivative instruments

Lease liabilities

Asset retirement obligations and other

Total deferred tax assets

Total deferred income tax assets

Valuation allowance

Net deferred tax assets

Deferred tax liabilities:

Deferred income tax assets, net

Deferred income tax liabilities:

Oil and gas properties

Lease right-of-use assets

Investment in Martica

2026 Convertible Notes and other

Total deferred tax liabilities

Net deferred tax liabilities

ANTERO RESOURCES CORPORATION

Notes to Consolidated Financial Statements (Continued)

In assessing the realizability of deferred tax assets, management considers whether some portion or all of the deferred tax assets will be realized based on a more-likely-than-not standard of judgment.

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.

Management considers the scheduled reversal of deferred tax liabilities, projected future taxable income and tax planning 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 $ 50 million and $ 57 million as of December 31, 2021 and 2022, respectively.

The valuation allowance as of December 31, 2021 and 2022, 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.

Total deferred income tax liabilities

Deferred tax liability, net

In assessing the realizability of deferred income tax assets, management considers whether some portion or all of the deferred income tax assets will be realized based on a more-likely-than-not standard of judgment.

The ultimate realization of deferred income tax assets is dependent upon the generation of future taxable income during the periods in which the Company’s temporary differences become deductible.

Management considers the scheduled reversal of deferred income tax liabilities, projected future taxable income and tax planning strategies in making this assessment.

Based upon the projections of future taxable income over the periods in which the deferred income 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 $ 57 million and $ 55 million as of December 31, 2022 and 2023, respectively.

The valuation allowance for each of the years ended December 31, 2022 and 2023, relates primarily to Colorado, Oklahoma and West Virginia state NOL carryforwards and are the result of expected future reduced income tax apportionment in those states.

The amount of the deferred income 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.

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 2023.

The Company has no unrecognized tax benefit balances through December 31, 2023.

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federal and West Virginia NOL carryforwards generated in tax years prior to 2018 expire between 2036 and 2037.

The Colorado NOL carryforwards generated in tax years prior to 2018 expire between 2024 and 2041.

For tax years 2018 and thereafter, NOL carryforwards generated in these jurisdictions have no expiration date.

The Pennsylvania NOL carryforwards expire between 2038 and 2041.

For tax years 2018 and thereafter, U.S.

federal and West Virginia NOL carryforwards generated in these jurisdictions have no expiration date.

The Colorado NOL carryforwards generated in tax years prior to 2018 or in 2021 expire between 2025 and 2041.

The Colorado NOL Carryforwards generated in tax years 2018 through 2020 have no expiration date.

Tax years 2020 through 2023 remain open to examination by the U.S.

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The Company and its subsidiaries file tax returns with various state taxing authorities and those returns remain open to examination for tax years 2019 through 2023.

ANTERO RESOURCES CORPORATION

Notes to Consolidated Financial Statements (Continued)

(14) Commitments

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however, the Company will record in the consolidated financial statements its proportionate share of costs based on its working interest.

In January 2023, the Company executed an early termination of its firm transportation commitment of 200,000 MMBtu per day on the Equitrans pipeline and made a cash payment of $ 24 million.

ANTERO RESOURCES CORPORATION

Notes to Consolidated Financial Statements (Continued)

Processing, Gathering, Compression and Water Service Commitments

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None of these agreements were determined to be leases.

ANTERO RESOURCES CORPORATION

Notes to Consolidated Financial Statements (Continued)

(e) Contract Terminations

The Company incurs costs associated with the delay or cancellation of certain contracts with third parties.

These costs are recorded in Contract termination and included in the statement of operations and comprehensive income (loss).

There are no remaining payment obligations related to these delayed or cancelled contracts as of December 31, 2022.

These costs are recorded in contract termination and included in the statements of operations and comprehensive income (loss).

During 2022, the Company cancelled the construction of the Smithburg 2 gas processing plant and made a cash payment of $ 12 million.

During 2023, the Company executed an early termination of its firm transportation commitment of 200,000 MMBtu/d on the Equitrans pipeline and made a cash payment of $ 24 million.

There are no remaining payment obligations related to any delayed or cancelled contracts as of December 31, 2023.

(15) Contingencies

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In March of 2017, WGL filed a lawsuit against the Company in Colorado district court claiming that the Company breached contractual obligations by failing to deliver “TCO pool” gas, ultimately seeking damages of more than $ 40 million.

Subsequently, after WGL failed to take certain volumes of gas required under the Contracts, the Company filed a separate lawsuit against WGL to

ANTERO RESOURCES CORPORATION

Notes to Consolidated Financial Statements (Continued)

recover damages that WGL refused to pay.

Subsequently, after WGL failed to take certain volumes of gas required under the Contracts, the Company filed a separate lawsuit against WGL to recover damages that WGL refused to pay.

These two lawsuits were consolidated and tried in June 2019.

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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.

In addition, pending litigation against operators in the Appalachian Basin, including the Company, could have an impact on the methods for determining the amount of permitted post-production costs and types of costs that may be deducted from royalty payments, among other things.

A ruling was recently received in an immaterial case to which the Company is a party, and the Company continues to analyze how this decision may impact other cases to which the Company is a party.

The Company cannot predict how these issues may ultimately be resolved, and therefore is also unable to estimate any potential damages, if any, that may result.

ANTERO RESOURCES CORPORATION

Notes to Consolidated Financial Statements (Continued)

In addition, pending litigation against the Company and other similarly situated peer operators could have an impact on the methods for determining the amount of permitted post-production costs and types of costs that have been, and may be, deducted from royalty payments, among other things.

While the amounts claimed could be material, we are unable to predict with certainty the ultimate outcome of such claims and proceedings.

Rulings were recently received in two cases to which the Company is a party, and where the plaintiffs alleged, and the court found, that certain post-production costs may not be deducted:

a non-class action lawsuit in West Virginia and a class action lawsuit in Ohio.

In each case, the alleged damages were not material.

The Company will continue to challenge the legal conclusions reached in each of these cases with respect to deductibility of post-production costs, and continues to analyze how these decisions may impact other cases to which the Company is a party.

At this time, the Company cannot predict how these issues may ultimately be resolved, and therefore is also unable to estimate any potential damages, if any, that may result.

The Company accrues for litigation, claims and proceedings when liability is both probable and the amount can be reasonably estimated, and does not currently have any material amounts accrued with respect to its pending litigation matters.

(16) Related Parties

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Where feasible, the Company purchases and sells third-party natural gas and NGLs and markets its excess firm transportation capacity, or engages third parties to conduct these activities on the Company’s behalf, in order to optimize the revenues from these transportation agreements.

The Company has entered into long-term firm transportation agreements for a significant portion of its

The Company has entered into long-term firm transportation agreements for a significant portion of its current and expected future production in order to secure guaranteed capacity to favorable markets.

ANTERO RESOURCES CORPORATION

Notes to Consolidated Financial Statements (Continued)

current and expected future production in order to secure guaranteed capacity to favorable markets.

Equity Method Investment in Antero Midstream

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Impairment of property and equipment

Impairment of goodwill

Total operating expenses

( 1,018,357 )

Operating loss

Equity in earnings (loss) of unconsolidated affiliates

Operating income (loss)

Equity in earnings of unconsolidated affiliates

Capital expenditures for segment assets

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Sales and revenues:

( 1,040,357 )

Total revenue

( 1,041,771 )

Operating expenses:

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As of December 31, 2022

Elimination of

Equity Method

Investment in

Transactions and

Elimination of

Unconsolidated

2 unchanged sentences

As of December 31, 2023

Elimination of

Equity Method

Investment in

Transactions and

Elimination of

Unconsolidated

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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.

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.

ANTERO RESOURCES CORPORATION

Notes to Consolidated Financial Statements (Continued)

Balance Sheet

December 31, 2022

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.

Balance Sheets

Current assets

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(19) Supplemental Information on Oil and Gas Producing Activities (Unaudited)

The following tables set forth supplemental information regarding the Company’s consolidated oil and gas producing activities (in thousands).

The tables below 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.

17 unchanged sentences

Notes to Consolidated Financial Statements (Continued)

Results of Operations for Oil and Gas Producing Activities

Year Ended December 31,

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Impairment of unproved properties

Results of operations before income tax (expense) benefit

Income tax (expense) benefit

Results of operations before income tax expense

Income tax expense

Results of operations

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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.

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.

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)

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.

This information includes the Company’s royalty and net working interest share of the reserves in oil and gas properties.

Proved reserves:

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(2) Proved undeveloped reserves for the noncontrolling interests in Martica as of December 31, 2021 were 34 Bcfe, which consisted of 23 Bcf of natural gas, 2 MMBbl of NGLs and 0.2 MMBbl of oil and condensate.

Proved undeveloped reserves for the noncontrolling interests in Martica as of December 31, 2021 were 34 Bcfe, which consisted of 23 Bcf of natural gas, 2 MMBbl of NGLs and 0.2 MMBbl of oil and condensate.

Proved undeveloped reserves for the noncontrolling interests in Martica as of December 31, 2022 were 1 Bcfe, which consisted entirely of natural gas.

There were no proved undeveloped reserves for the noncontrolling interests in Martica as of December 31, 2023.

Significant changes in proved reserves for the years ended December 31, 2021, 2022 and 2023 include the following:

1 unchanged sentence

● Extensions, discoveries, and other additions of 472 Bcfe resulted from delineation and development drilling in the Appalachian Basin.

● Net downward revisions of 940 Bcfe include:

o Net downward revision of 1,126 Bcfe due to decreases in prices for natural gas, NGLs and oil.

● Net upward revisions of 1,486 Bcfe include:

ANTERO RESOURCES CORPORATION

Notes to Consolidated Financial Statements (Continued)

o Net downward revision of 922 Bcfe for locations that were not developed within five years of initial booking as proved reserves.

o Net upward performance revisions of 491 Bcfe.

o Upward revisions of 485 Bcfe are due to an increase in the Company’s assumed future ethane recovery.

o Net upward revision of 132 Bcfe due to schedule optimization primarily driven by previously proved undeveloped properties reclassified from non-proved to proved undeveloped.

● Sales of reserves of 113 Bcfe related to the VPP.

2021 Proved Reserve Changes

● Extensions, discoveries, and other additions of 472 Bcfe resulted from delineation and development drilling in the Appalachian Basin.

● Net upward revisions of 1,486 Bcfe include:

o Net upward revision of 651 Bcfe related to optimization to the Company’s five-year development plan.

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o Upward revisions of 2 Bcfe due to increases in prices for natural gas, NGLs and oil.

2023 Proved Reserve Changes

● Extensions, discoveries, and other additions of 413 Bcfe resulted from delineation and development drilling in the Appalachian Basin.

● Net upward revisions of 1,187 Bcfe include:

o Net upward revisions of previous estimates of 814 Bcfe includes 846 Bcfe for increases in the Company’s ownership interests, partially offset by downward revisions of 32 Bcfe related to changes in the Company’s reserve forecast and operation cost estimates.

o Net upward revision of 454 Bcfe related to optimization to the Company’s five-year development plan.

This figure includes upward revisions of 698 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 244 Bcfe for locations that were not developed within five years of initial booking as proved reserves.

o Downward revisions of 81 Bcfe due to decreases in prices for natural gas, NGLs and oil.

Standardized Measure of Discounted Future Net Cash Flow

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Future production and development costs represent the estimated future expenditures (based on current costs) to be incurred in developing and producing the proved reserves, assuming continuation of existing economic conditions.

Future income tax expenses

Future income tax expenses were computed by applying statutory income tax rates to the difference between pretax net cash flows relating to the Company’s

ANTERO RESOURCES CORPORATION

Notes to Consolidated Financial Statements (Continued)

were computed by applying statutory income tax rates to the difference between pretax net cash flows relating to the Company’s proved reserves and the tax basis of proved oil and gas properties.

proved reserves and the tax basis of proved oil and gas properties.

In addition, the effects of available NOL carryforwards and alternative minimum tax credits were used in computing future income tax expense.

10 unchanged sentences

Standardized measure of discounted future net cash flows (1)

(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.

(1) The standardized measure of discounted future net cash flows for the noncontrolling interests in Martica were $ 501 million, $ 458 million and $ 170 million for the years ended December 31, 2021, 2022 and 2023, respectively.

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End of year (2)

(1) The net changes in prices and production costs are calculated prior to the consideration of future income tax expense.

The Standardized Measure included future income tax expense of $ 7.8 billion, $ 13.7 billion and $ 2.2 billion for the years ended December 31, 2021, 2022 and 2023, respectively.

(2) The standardized measure for the noncontrolling interests in Martica were $ 501 million, $ 458 million and $ 170 million for the years ended December 31, 2021, 2022 and 2023, 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.

What changed 10-K

Item 9A. Controls and Procedures