v3.24.2.u1
Fair value measurements
 6 Months Ended
Jun. 30, 2024
Fair Value Disclosures [Abstract]  
Fair value measurements Fair value measurements
See the beginning of Note 12 in the 2023 Annual Report for information about the fair value hierarchy levels.
Fair value measurement on a recurring basis
See Note 8 for further discussion of the Company's derivatives.
Balance sheet presentation
The following tables present the Company's derivatives by (i) balance sheet classification, (ii) derivative type and (iii) fair value hierarchy level, and provide a total, on a gross basis and a net basis reflected in "Derivatives" on the consolidated balance sheets as of the dates presented:
June 30, 2024
(in thousands)Level 1Level 2Level 3Total gross fair valueAmounts offsetNet fair value presented on the consolidated balance sheets
Assets:
Current:
Commodity$— $17,101 $— $17,101 $(13,637)$3,464 
Contingent consideration— — 1,031 1,031 — 1,031 
Noncurrent:
Commodity— 3,925 — 3,925 454 4,379 
Contingent consideration— — 31,996 31,996 — 31,996 
Liabilities:
Current:
Commodity— (30,174)— (30,174)13,637 (16,537)
Noncurrent:
Commodity— 302 — 302 (454)(152)
Net derivative asset positions$— $(8,846)$33,027 $24,181 $— $24,181 
December 31, 2023
(in thousands)Level 1Level 2Level 3Total gross fair valueAmounts offsetNet fair value presented on the consolidated balance sheets
Assets:
Current:
Commodity$— $106,067 $— $106,067 $(9,032)$97,035 
Contingent consideration— — 2,301 2,301 — 2,301 
Noncurrent:
Commodity— 22,266 — 22,266 — 22,266 
Contingent consideration— — 28,805 28,805 — 28,805 
Liabilities:
Current:
Commodity— (9,032)— (9,032)9,032 — 
Net derivative asset positions$— $119,301 $31,106 $150,407 $— $150,407 
See Note 12 in the 2023 Annual Report for discussion of the significant Level 2 inputs used in the fair value mark-to-market analysis of commodity and contingent consideration derivatives. The Company reviewed the third-party specialist's valuations of commodity and contingent consideration derivatives, including the related inputs, and analyzed changes in fair values between reporting dates.
The Sixth Street Contingent Consideration was categorized as Level 3 of the fair value hierarchy, as the Company utilized its own cash flow projections along with a risk-adjusted discount rate generated by a third-party valuation specialist to determine the valuation. The Company reviewed the third-party specialist's valuation, including the related inputs, and analyzed changes in fair values between the divestiture closing date and the reporting dates. The fair value of the Sixth Street Contingent Consideration was recorded as part of the basis in the oil and natural gas properties divested and as a contingent consideration asset. At each quarterly reporting period, the Company remeasures contingent consideration with the change in fair values recognized in "Gain (loss) on derivatives, net" under "Non-operating income (expense)" on the consolidated statement of operations. See Note 8 for additional discussion of the Sixth Street Contingent Consideration.
The following table summarizes the changes in contingent consideration derivatives classified as Level 3 measurements for the periods presented:
Three months ended June 30,Six months ended June 30,
(in thousands)2024202320242023
Balance of Level 3 at beginning of period$34,794 $28,093 $31,106 $26,640 
Change in Sixth Street Contingent Consideration fair value(1,767)(1,854)1,921 1,054 
Settlements realized(1)
— — — (1,455)
Balance of Level 3 at end of period$33,027 $26,239 $33,027 $26,239 
_____________________________________________________________________________
(1)For the six months ended June 30, 2024 and 2023, any settlements are included in "Other, net" in cash flows from investing activities on the consolidated statements of cash flows.
Items not accounted for at fair value
The carrying amounts reported on the consolidated balance sheets for cash and cash equivalents, accounts receivable, accounts payable, accrued capital expenditures, undistributed revenue and royalties and other accrued assets and liabilities approximate their fair values.
The Company has not elected to account for its debt instruments at fair value. The following table presents the carrying amounts and fair values of the Company's debt as of the dates presented:
 June 30, 2024December 31, 2023
(in thousands)
Carrying
amount(1)
Fair
value(2)
Carrying
amount(1)
Fair
value(2)
Debt$1,690,578 $1,737,662 $1,633,523 $1,658,686 
______________________________________________________________________________
(1)Amounts presented do not include issuance premiums or discounts.
(2)The fair values of the outstanding notes were determined using the Level 2 fair value hierarchy quoted market prices for each respective instrument as of June 30, 2024 and December 31, 2023. The fair values of the outstanding debt under the Senior Secured Credit Facility approximated their carrying value based on short-term floating interest rates available to the Company at the time.