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NOTE 9 — RESTRICTED DEPOSITS FOR ARO
Restricted deposits as of December 31, 2022 and 2021 consisted of funds escrowed for collateral related to the future plugging and abandonment obligations of certain oil and natural gas properties as follows:
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December 31, |
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2022 |
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2021 |
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Main Pass 283/Viosca Knoll 734 (1) |
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$ |
13,684 |
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$ |
13,663 |
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Eugene Island 205/89 (2) |
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— |
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1,880 |
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South Marsh Island 73 (3) |
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7,753 |
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— |
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Other |
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47 |
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477 |
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(1) |
In connection with a prior period acquisition of the Main Pass 283 and Viosca Knoll 734 fields, the Company received funds from the previous operator to cover future asset retirement obligations for those fields. The Company is not obligated to contribute additional amounts to these escrowed accounts. |
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(2) |
In connection with a prior period acquisition of the Eugene Island 205 and 89 fields, the Company received funds from the previous owner to cover future asset retirement obligations for those fields. As of December 31, 2022, the Company has performed the related plugging and abandonment work at both fields.
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(3) |
During the first and second quarter of 2022, the Company acquired the South Marsh Island 73 field. As part of the transaction, the Company received a total of $7.8 million from the previous owners to cover future asset retirement obligations. The Company is not obligated to contribute additional amounts to this escrowed account. See Note 6 - Acquisitions for additional information.
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Black Elk Escrow – On December 29, 2021, the United States Bankruptcy Court for the Southern District of Texas sent the Company notice that it is able to retain the remaining funds related to Black Elk liquidation in 2020 and that those funds were no longer subject to any restrictions, effectively releasing the cash from escrow. Accordingly, the Company removed the remaining liability of $11.1 million and transferred the related cash previously retained in escrow to cash. The Company recorded the $11.1 million in Other (income) expense during the year ended December 31, 2021.
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