PROPERTY AND EQUIPMENT
|6 Months Ended|
Jun. 30, 2021
|Property, Plant and Equipment [Abstract]|
|PROPERTY AND EQUIPMENT||PROPERTY AND EQUIPMENT
The major categories of property and equipment and related accumulated DD&A and impairment as of June 30, 2021 and December 31, 2020 are as follows:
Under the full cost method of accounting, the Company is required to perform a ceiling test each quarter. The test determines a limit, or ceiling, on the book value of the Company's oil and natural gas properties. At June 30, 2021, the net book value of the Company's oil and gas properties was above the calculated ceiling for the period leading up to June 30, 2021. As a result, the Company recorded impairment of its oil and natural gas properties of $117.8 million for the Successor Period. No impairments were recorded in either of the Current Predecessor Quarter or the Current Predecessor YTD Period. The Company recorded an impairment of its oil and natural gas properties of $532.9 million and $1.1 billion for the Prior Predecessor Quarter and the Prior Predecessor YTD Period, respectively, as a result of the significant decrease in commodity prices.
Certain general and administrative costs are capitalized to the full cost pool and represent management’s estimate of costs incurred directly related to exploration and development activities. All general and administrative costs not capitalized are charged to expense as they are incurred. Capitalized general and administrative costs were approximately $2.2 million for the Successor Period, $2.5 million, for the Current Predecessor Quarter, and $8.0 million for Current Predecessor YTD Period. Capitalized general and administrative costs were approximately $8.2 million and $13.6 million for the Prior Predecessor Quarter and the Prior Predecessor YTD Period, respectively.
The Company evaluates the costs excluded from its amortization calculation at least annually. Individually insignificant unevaluated properties are grouped for evaluation and periodically transferred to evaluated properties over a timeframe consistent with their expected development schedule.
The following table summarizes the Company’s unevaluated properties excluded from amortization by area at June 30, 2021:
Impairment of Other Property and Equipment
During the Current Predecessor YTD Period, the Company recorded an impairment of $14.6 million related to its corporate headquarters as a result of changes in the expected future use.
Asset Retirement Obligation
The following table provides a reconciliation of the Company’s asset retirement obligation for the periods presented:
The entire disclosure for long-lived, physical asset used in normal conduct of business and not intended for resale. Includes, but is not limited to, work of art, historical treasure, and similar asset classified as collections.
Reference 1: http://www.xbrl.org/2003/role/disclosureRef