Chord Energy Corp

18. Leases

In the first quarter of 2023, the Company began negotiations to sublease a portion of its Denver corporate office. As a result of an offer received and the overall market conditions, the Company recorded a right-of-use (“ROU”) asset impairment charge of $17.5 million during the three months ended March 31, 2023. This asset impairment charge primarily consisted of $12.1 million related to the amount by which the carrying value of the ROU asset exceeded the fair value and $5.5 million related to the remaining leasehold improvements. The Company estimated the fair value of the ROU asset using an income approach based on the net present value of the expected sublease rental income during the sublease term. The ROU asset impairment charge is recorded within exploration and impairment on the Condensed Consolidated Statements of Operations. There wereno lease impairment charges recorded during the three months ended March 31, 2024.

Other than the item disclosed above, no other material changes have occurred to the Company’s lease portfolio for the periods presented. Refer to the 2023 Annual Report for more information on the Company’s leases.