W&T Offshore, Inc. Annual report pursuant to Section 13 and 15(d)

Annual report pursuant to Section 13 and 15(d)

Note 8 - Restricted Deposits for ARO

Note 8 - Restricted Deposits for ARO	12 Months Ended
Dec. 31, 2020
Notes to Financial Statements
Restricted Assets Disclosure [Text Block]	8. Restricted Deposits for ARO Restricted deposits as of December 31, 2020 and 2019 consisted of funds escrowed for collateral related to the future plugging and abandonment obligations of certain oil and natural gas properties. Pursuant to the Purchase and Sale Agreement with Total E&P USA Inc. (“Total E&P”), security for future plugging and abandonment of certain oil and natural gas properties is required either through surety bonds or payments to an escrow account or a combination thereof. Monthly payments are made to an escrow account and these funds are returned to us once verification is made that the security amount requirements have been met. See Note 15 for potential future security requirements. During the year ended December 31, 2020, W&T received $13.9 million of cash as a restricted deposit to be used exclusively for payment of certain asset retirement obligations related to properties sold by W&T to Black Elk Energy Offshore Operations, LLC (“Black Elk”) in connection with the liquidation of Black Elk under Chapter 11 of the U.S. Bankruptcy Code. The cash was retained in an escrow account and recorded within Restricted Deposits for Asset Retirement Obligations on the Consolidated Balance Sheet as of December 31, 2020. $11.1 million was recorded in Other Liabilities as of December 31, 2020 as our estimate of the additional asset retirement obligations to be funded from the restricted deposit account.

Note 8 - Restricted Deposits for ARO

12 Months Ended

Dec. 31, 2020

Restricted Assets Disclosure [Text Block]

8. Restricted Deposits for ARO

Restricted deposits as of December 31, 2020 and 2019 consisted of funds escrowed for collateral related to the future plugging and abandonment obligations of certain oil and natural gas properties.

Pursuant to the Purchase and Sale Agreement with Total E&P USA Inc. (“Total E&P”), security for future plugging and abandonment of certain oil and natural gas properties is required either through surety bonds or payments to an escrow account or a combination thereof. Monthly payments are made to an escrow account and these funds are returned to us once verification is made that the security amount requirements have been met. See Note 15 for potential future security requirements.

During the year ended December 31, 2020, W&T received $13.9 million of cash as a restricted deposit to be used exclusively for payment of certain asset retirement obligations related to properties sold by W&T to Black Elk Energy Offshore Operations, LLC (“Black Elk”) in connection with the liquidation of Black Elk under Chapter 11 of the U.S. Bankruptcy Code. The cash was retained in an escrow account and recorded within Restricted Deposits for Asset Retirement Obligations on the Consolidated Balance Sheet as of December 31, 2020. $11.1 million was recorded in Other Liabilities as of December 31, 2020 as our estimate of the additional asset retirement obligations to be funded from the restricted deposit account.