FANG · 10-Q · 2026Q2 · Full report

Oil and Gas Property Impairment

Diamondback Energy, Inc. · 2026-08-05 · Importance 53 · Surprise 60 · In source text

Diamondback recorded a $1.4 billion oil and natural gas property impairment during the six months ended June 30, 2026. The charge was included in accumulated depletion, depreciation, amortization and impairment and reduced net oil and natural gas properties to $66.096 billion at June 30, 2026, from $67.949 billion at December 31, 2025. No impairment expense was recorded during the three or six months ended June 30, 2025. The impairment analysis is affected by commodity prices, production rates, proved reserves and future development costs, creating potential for additional material write-downs if trailing commodity prices decline.

Key facts

• Impairment of oil and natural gas properties for the three months ended March 31, 2026: $1,400 million (non-cash ceiling test impairment charge). source
• Impairment of oil and natural gas properties for the six months ended June 30, 2026: $1,400 million (non-cash ceiling test impairment charge). source
• Company currently does not expect to record additional impairment of assets in the third quarter of 2026. source
• Impairment of oil and natural gas properties recorded during period: $1,400 million source
• Company recorded an impairment of approximately $1.4 billion during the six months ended June 30, 2026 source
• The decrease in depletion of proved oil and natural gas properties of $25 million in Q2 2026 compared to Q1 2026 consisted of an $89 million reduction from a decline in depletion rate following the ceiling test impairment in Q1 2026, partially offset by a $64 million increase due to higher quarterly production volumes. source
• The $214 million increase in depletion of proved oil and natural gas properties for the six months ended June 30, 2026 compared to 2025 consisted of $293 million from growth in production volumes partially offset by a $79 million reduction attributable to a decrease in the depletion rate caused by ceiling test impairments recorded in Q4 2025 and Q1 2026. source
• The guarantor group recorded a non-cash impairment during the six months ended June 30, 2026 reflected in summarized results of the guarantor group and noted as not indicative of cash flows available for debt service. source

Impact estimates