KOSMOS ENERGY LTD. Notes to Consolidated Financial Statements (Continued) 2. Accounting Policies (Continued) Cash, Cash Equivalents and Restricted Cash December 31, 2017 2016 2015 (In thousands) Cash and cash equivalents . . . . . . . . . . . . . . . . . . . $233,412 $194,057 $275,004 Restricted cash—current . . . . . . . . . . . . . . . . . . . . 56,380 24,506 28,533 Restricted cash—long-term . . . . . . . . . . . . . . . . . . 15,194 54,632 7,325 Total cash, cash equivalents and restricted cash shown in the consolidated statements of cash flows . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $304,986 $273,195 $310,862 Cash and cash equivalents includes demand deposits and funds invested in highly liquid instruments with original maturities of three months or less at the date of purchase. In accordance with our commercial debt facility (the ‘‘Facility’’), we were required to maintain a restricted cash balance that is sufficient to meet the payment of interest and fees for the next six-month period on the 7.875% Senior Secured Notes due 2021 (‘‘Senior Notes’’) plus the Corporate Revolver or the Facility, whichever is greater. As of December 31, 2017 and 2016, we had $24.8 million and $24.5 million, respectively, in current restricted cash to meet this requirement. In addition, in accordance with certain of our petroleum contracts, we have posted letters of credit related to performance guarantees for our minimum work obligations. These letters of credit are cash collateralized in accounts held by us and as such are classified as restricted cash. Upon completion of the minimum work obligations and/or entering into the next phase of the petroleum contract, the requirement to post the existing letters of credit will be satisfied and the cash collateral will be released. However, additional letters of credit may be required should we choose to move into the next phase of certain of our petroleum contracts. As of December 31, 2017 and 2016, we had $31.6 million and zero, respectively, of current restricted cash and $15.2 million and $54.6 million, respectively, of long-term restricted cash used to cash collateralize performance guarantees related to our petroleum contracts. Receivables Our receivables consist of joint interest billings, oil sales and other receivables. For our oil sales receivable, we require a letter of credit to be posted to secure the outstanding receivable. Receivables from joint interest owners are stated at amounts due, net of any allowances for doubtful accounts. We determine our allowance by considering the length of time past due, future net revenues of the debtor’s ownership interest in oil and natural gas properties we operate, and the owner’s ability to pay its obligation, among other things. We had an allowance for doubtful accounts of zero and $0.6 million in current joint interest billings receivables as of December 31, 2017 and 2016, respectively. Inventories Inventories consisted of $63.5 million and $68.1 million of materials and supplies and $8.4 million and $6.3 million of hydrocarbons as of December 31, 2017 and 2016, respectively. The Company’s materials and supplies inventory primarily consists of casing and wellheads and is stated at the lower of 113