UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)

For the quarterly period ended June 30, 2014

OR

For the transition period from                      to                     

Commission File Number: 001-33801

APPROACH RESOURCES INC.

(Exact name of registrant as specified in its charter)

(817) 989-9000

(Registrant’s telephone number, including area code)

N/A

(Former name, former address and former fiscal year, if changed since last report)

Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.    x  Yes    ¨  No

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during .the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).    x  Yes    ¨  No

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).    ¨  Yes    x  No

The number of shares of the registrant’s common stock, $0.01 par value, outstanding as of July 24, 2014, was 39,369,986.

PART I—FINANCIAL INFORMATION

Item 1. Financial Statements.

Approach Resources Inc. and Subsidiaries

Unaudited Consolidated Balance Sheets

(In thousands, except shares and per-share amounts)

See accompanying notes to these unaudited consolidated financial statements

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Approach Resources Inc. and Subsidiaries

Unaudited Consolidated Statements of Operations

(In thousands, except shares and per-share amounts)

See accompanying notes to these unaudited consolidated financial statements

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Approach Resources Inc. and Subsidiaries

Unaudited Consolidated Statements of Cash Flows

(In thousands)

See accompanying notes to these unaudited consolidated financial statements

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Approach Resources Inc. and Subsidiaries

Notes to Consolidated Financial Statements (Unaudited)

June 30, 2014

1. Summary of Significant Accounting Policies

Organization and Nature of Operations

Approach Resources Inc. (“Approach,” the “Company,” “we,” “us” or “our”) is an independent energy company engaged in the exploration, development, production and acquisition of oil and gas properties. We focus on finding and developing oil and natural gas reserves in oil shale and tight gas sands. Our properties are primarily located in the Permian Basin in West Texas. We also own interests in the East Texas Basin.

Consolidation, Basis of Presentation and Significant Estimates

The interim consolidated financial statements of the Company are unaudited and contain all adjustments (consisting primarily of normal recurring accruals) necessary for a fair statement of the results for the interim periods presented. Results for interim periods are not necessarily indicative of results to be expected for a full year due in part to the volatility in prices for oil, NGLs and gas, future commodity prices for commodity derivative contracts, global economic and financial market conditions, interest rates, access to sources of liquidity, estimates of reserves, drilling risks, geological risks, transportation restrictions, the timing of acquisitions, product supply and demand, market competition and interruptions of production. You should read these consolidated interim financial statements in conjunction with the audited consolidated financial statements and notes thereto included in our Annual Report on Form 10-K for the year ended December 31, 2013, filed with the Securities and Exchange Commission on February 25, 2014.

The accompanying interim consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America and include the accounts of the Company and its wholly owned subsidiaries. Intercompany accounts and transactions are eliminated. In preparing the accompanying financial statements, management has made certain estimates and assumptions that affect reported amounts in the financial statements and disclosures of contingencies. Actual results may differ from those estimates. Significant assumptions are required in the valuation of proved oil and gas reserves, which affect our estimate of depletion expense as well as our impairment analyses. Significant assumptions also are required in our estimation of accrued liabilities, commodity derivatives, income tax provision, share-based compensation and asset retirement obligations. It is at least reasonably possible these estimates could be revised in the near term, and these revisions could be material. Certain prior-year amounts have been reclassified to conform to current-year presentation. These classifications have no impact on the net income reported.

Recent Accounting Pronouncements

In April 2014, the Financial Accounting Standards Board (“FASB”) issued guidance that raised the threshold for a disposal to qualify as a discontinued operation and requires new disclosures of both discontinued operations and certain other disposals that do not meet the definition of a discontinued operation. Under the updated standard, a discontinued operation is (i) a component of an entity or group of components that has been disposed of by sale, disposed of other than by sale or is classified as held for sale that represents a strategic shift that has or will have a major effect on an entity’s operations and financial results, or (ii) an acquired business or nonprofit activity that is classified as held for sale on the date of the acquisition. This update is aimed at reducing the frequency of disposals reported as discontinued operations by focusing on strategic shifts that have or will have a major effect on an entity’s operations and financial results. This accounting standards update is effective for annual reporting periods beginning on or after December 15, 2014, and will be applied prospectively. The Company is evaluating the impact of this new guidance and does not expect it to have a significant impact on the consolidated financial statements.

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Approach Resources Inc. and Subsidiaries

Notes to Consolidated Financial Statements (Unaudited)

June 30, 2014

In May 2014, the FASB issued an accounting standards update for “Revenue from Contracts with Customers,” which supersedes the revenue recognition requirements in “Topic 605, Revenue Recognition”. This accounting standard update provides new guidance concerning recognition and measurement of revenue and requires additional disclosures about the nature, timing and uncertainty of revenue and cash flows arising from contracts with customers. This new guidance is effective retrospectively for annual reporting periods beginning on or after December 15, 2016, with early application not permitted. The Company is evaluating our existing revenue recognition policies to determine whether any contracts will be affected by the new requirements.

2. Equity Method Investment

In September 2012, we entered into a joint venture to build an oil pipeline in Crockett and Reagan Counties, Texas, which is used to transport our oil to market. In October 2012, we made an initial contribution of $10 million to the joint venture for pipeline and facilities construction, and in 2013, we contributed $8.3 million to the joint venture for pipeline and facilities construction. Our contributions are recorded at cost and are included in investing activities under “Contribution to equity method investment” on our consolidated statements of cash flows. Our share of the investee’s earnings was recorded on our consolidated statement of operations for the three months ended June 30, 2013. In October 2013, we completed the sale of the joint venture, and net proceeds to Approach at closing totaled approximately $109.1 million, after deducting our share of transactional costs paid at closing. Of the $109.1 million in proceeds, $7.4 million was restricted pursuant to an escrow agreement. The escrow agreement terminated on June 1, 2014, and the cash held in escrow was subsequently released. We incurred $0.2 million in post-closing working capital adjustments during the three months ended June 30, 2014.

3. Earnings Per Common Share

We report basic earnings per common share, which excludes the effect of potentially dilutive securities, and diluted earnings per common share, which includes the effect of all potentially dilutive securities unless their impact is antidilutive. The following table provides a reconciliation of the numerators and denominators of our basic and diluted earnings per share (dollars in thousands, except per-share amounts).

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Approach Resources Inc. and Subsidiaries

Notes to Consolidated Financial Statements (Unaudited)

June 30, 2014

4. Long-Term Debt

The following table provides a summary of our long-term debt at June 30, 2014, and December 31, 2013 (in thousands).

Revolving Credit Facility

In May 2014, we entered into an amended and restated senior secured revolving credit facility (the “Credit Facility”) with an initial $450 million borrowing base, maximum commitments from the lenders of $1 billion and a maturity date of May 7, 2019. The borrowing base is redetermined semi-annually in April and October based on our oil, NGL and gas reserves. We, or the lenders, can each request one additional borrowing base redetermination each calendar year.

Borrowings under the Credit Facility bear interest based on the agent bank’s prime rate plus an applicable margin ranging from 0.50% to 1.50%, or the sum of the LIBOR rate plus an applicable margin ranging from 1.50% to 2.50%. In addition, we pay an annual commitment fee ranging from 0.375% to 0.50% of unused borrowings available under the Credit Facility. Margins vary based on the borrowings outstanding compared to the borrowing base.

We had outstanding borrowings of $46 million under our Credit Facility at June 30, 2014, compared to no outstanding borrowings at December 31, 2013. The weighted average interest rate applicable to borrowings under our Credit Facility for the six months ended June 30, 2014, was 2%. We had outstanding unused letters of credit under our Credit Facility totaling $0.3 million at June 30, 2014, and December 31, 2013, which reduce amounts available for borrowing under our Credit Facility.

Obligations under the Credit Facility are secured by mortgages on substantially all of the oil and gas properties of the Company and its subsidiaries. The Company is required to maintain liens covering the oil and gas properties of the Company and its subsidiaries representing at least 80% of the total value of all oil and gas properties of the Company and its subsidiaries.

Covenants

Our Credit Facility contains two principal financial covenants:

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Approach Resources Inc. and Subsidiaries

Notes to Consolidated Financial Statements (Unaudited)

June 30, 2014

Our Credit Facility also contains covenants restricting cash distributions and other restricted payments, transactions with affiliates, incurrence of other debt, consolidations and mergers, the level of operating leases, asset sales, investment in other entities and liens on properties.

In addition, the obligations of the Company may be accelerated upon the occurrence of an Event of Default (as defined in the Credit Facility). Events of Default include customary events for a financing agreement of this type, including, without limitation, payment defaults, the inaccuracy of representations and warranties, defaults in the performance of affirmative or negative covenants, defaults on other indebtedness of the Company or its subsidiaries, bankruptcy or related defaults, defaults related to judgments and the occurrence of a Change of Control (as defined in the Credit Facility), which includes instances where a third party becomes the beneficial owner of more than 50% of the Company’s outstanding equity interests entitled to vote.

Senior Notes

In June 2013, we completed the public offering of $250 million principal amount of 7% Senior Notes due 2021 (the “Senior Notes”). Annual interest on the Senior Notes is $17.5 million, payable semi-annually on June 15 and December 15.

We issued the Senior Notes under a senior indenture dated June 11, 2013, as supplemented by a supplemental indenture of even date, among the Company, our subsidiary guarantors and Wells Fargo Bank, National Association, as trustee.

On and after June 15, 2016, we may redeem some or all of the Senior Notes at specified redemption prices, plus accrued and unpaid interest to the redemption date. Before June 15, 2016, we may redeem up to 35% of the Senior Notes at a redemption price of 107% of the principal amount, plus accrued and unpaid interest to the redemption date, with the proceeds of certain equity offerings. In addition, before June 15, 2016, we may redeem some or all of the Notes for cash at a redemption price equal to 100% of their principal amount plus an applicable make-whole premium and accrued and unpaid interest to the redemption date. If we sell certain of our assets or experience specific kinds of changes of control, we may be required to offer to purchase the Senior Notes from holders. The Senior Notes are fully and unconditionally guaranteed on a senior unsecured basis by each of our subsidiaries, subject to certain customary release provisions. A subsidiary guarantor may be released from its obligations under the guarantee:

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Approach Resources Inc. and Subsidiaries

Notes to Consolidated Financial Statements (Unaudited)

June 30, 2014

The Indenture restricts our ability, among other things, to (i) sell certain assets, (ii) pay distributions on, redeem or repurchase, equity interests, (iii) incur additional debt, (iv) make certain investments, (v) enter into transactions with affiliates, (vi) incur liens and (vii) merge or consolidate with another company. These restrictions are subject to a number of important exceptions and qualifications. If at any time the Senior Notes are rated investment grade by both Moody’s Investors Service and Standard & Poor’s Ratings Services and no default (as defined in the Indenture) has occurred and is continuing, many of these restrictions will terminate. The Indenture contains customary events of default.

Subsidiary Guarantors

The Senior Notes are guaranteed on a senior unsecured basis by each of our consolidated subsidiaries. Approach Resources Inc. is a holding company with no independent assets or operations. The subsidiary guarantees are full and unconditional and joint and several, and any subsidiaries of the Company other than the subsidiary guarantors are minor. There are no significant restrictions on the Company’s ability, or the ability of any subsidiary guarantor, to obtain funds from its subsidiaries through dividends, loans, advances or otherwise.

At June 30, 2014, we were in compliance with all of our covenants, and there were no existing defaults or events of default, under our debt instruments.

5. Commitments and Contingencies

Our contractual obligations include long-term debt, daywork drilling contracts, operating lease obligations, asset retirement obligations and employment agreements with our executive officers. On January 3, 2014, we entered into an employment agreement with Sergei Krylov as the Company’s Executive Vice President and Chief Financial Officer. Our maximum commitment under this employment agreement, which would apply if Mr. Krylov were terminated without cause, is $1.3 million. Since December 31, 2013, there have been no other material changes to our contractual obligations. In August 2014, we extended our existing gas purchase and processing agreement with DCP Midstream, LP through August 2023.

We are involved in various legal and regulatory proceedings arising in the normal course of business. While we cannot predict the outcome of these proceedings with certainty, we do not believe that an adverse result in any pending legal or regulatory proceeding, individually or in the aggregate, would be material to our consolidated financial condition or cash flows.

6. Income Taxes

The effective income tax rate for the three and six months ended June 30, 2014, was 36.2% and 36.3%, respectively. Total income tax expense for the three and six months ended June 30, 2014, differed from amounts computed by applying the U.S. federal statutory tax rates to pre-tax income due primarily to state taxes.

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Approach Resources Inc. and Subsidiaries

Notes to Consolidated Financial Statements (Unaudited)

June 30, 2014

The effective income tax rate for the three and six months ended June 30, 2013, was 35.1%. Total income tax expense for the three and six months ended June 30, 2013, differed from amounts computed by applying the U.S. federal statutory tax rates to pre-tax income due primarily to state taxes and the impact of permanent differences between book and taxable income.

7. Fair Value of Financial and Derivative Instruments

The following table provides our outstanding commodity derivative positions at June 30, 2014.

Subsequent to June 30, 2014, we entered into two crude oil collars covering a total of 1,000 Bbls per day for 2015 at a floor price of $90.00/Bbl and a ceiling price of $102.50/Bbl.

The following table summarizes the fair value of our open commodity derivatives as of June 30, 2014, and December 31, 2013 (in thousands).

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Approach Resources Inc. and Subsidiaries

Notes to Consolidated Financial Statements (Unaudited)

June 30, 2014

The following table summarizes the change in the fair value of our commodity derivatives (in thousands).

Unrealized gains and losses, at fair value, are included on our consolidated balance sheets as current or non-current assets or liabilities based on the anticipated timing of cash settlements under the related contracts. Changes in the fair value of our commodity derivative contracts are recorded in earnings as they occur and included in other income (expense) on our consolidated statements of operations. We estimate the fair values of swap contracts based on the present value of the difference in exchange-quoted forward price curves and contractual settlement prices multiplied by notional quantities. We internally valued the option contracts using industry-standard option pricing models and observable market inputs. We use our internal valuations to determine the fair values of the contracts that are reflected on our consolidated balance sheets. Realized gains and losses are also included in other income (expense) on our consolidated statements of operations.

We are exposed to credit losses in the event of nonperformance by the counterparties on our commodity derivatives positions and have considered the exposure in our internal valuations. However, we do not anticipate nonperformance by the counterparties over the term of the commodity derivatives positions.

To estimate the fair value of our commodity derivatives positions, we use market data or assumptions that market participants would use in pricing the asset or liability, including assumptions about risk and the risks inherent in the inputs to the valuation technique. These inputs can be readily observable, market corroborated or generally unobservable. We primarily apply the market approach for recurring fair

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Approach Resources Inc. and Subsidiaries

Notes to Consolidated Financial Statements (Unaudited)

June 30, 2014

value measurements and attempt to use the best available information. We determine the fair value based upon the hierarchy that prioritizes the inputs used to measure fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurement) and lowest priority to unobservable inputs (Level 3 measurement). The three levels of fair value hierarchy are as follows:

Financial Instruments Not Recorded at Fair Value

The following table sets forth the fair values of financial instruments that are not recorded at fair value on our financial statements (in thousands).

The fair value of the Senior Notes uses pricing that is readily available in the public market. Accordingly, the fair value of the Senior Notes would be classified as Level 2 in the fair value hierarchy.

8. Share-Based Compensation

In February 2014, we awarded an aggregate of 245,157 restricted shares to our executive officers, of which 163,438 shares are subject to certain performance conditions and 81,719 shares are subject to three-year total shareholder return (“TSR”) conditions, assuming maximum TSR is achieved. Assuming target TSR is achieved, then 54,479 shares are subject to three-year TSR conditions. The aggregate fair market value of the award, assuming target TSR is achieved is $4.5 million, which will be expensed over a service period of approximately three years, subject to performance and three-year TSR conditions.

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Approach Resources Inc. and Subsidiaries

Notes to Consolidated Financial Statements (Unaudited)

June 30, 2014

Effective May 16, 2014, we entered into an executive grant and separation agreement (the “Separation Agreement”) with Ralph P. Manoushagian, former Executive Vice President — Land, upon his retirement. As set forth in the Separation Agreement, we granted Mr. Manoushagian 41,281 restricted stock units with an aggregate fair market value of $0.8 million that will be settled on December 31, 2014. We also recorded a benefit of $1.1 million in share-based compensation expense related to the forfeiture of 66,684 outstanding unvested shares of restricted stock previously awarded to Mr. Manoushagian.

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Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations.

The following discussion is intended to assist in understanding our results of operations and our financial condition. This section should be read in conjunction with management’s discussion and analysis contained in our Annual Report on Form 10-K for the year ended December 31, 2013, filed with the Securities and Exchange Commission (“SEC”) on February 25, 2014. Our consolidated financial statements and the accompanying notes included elsewhere in this Quarterly Report on Form 10-Q contain additional information that should be referred to when reviewing this material. Certain statements in this discussion may be forward-looking. These forward-looking statements involve risks and uncertainties, which could cause actual results to differ from those expressed in this report. A glossary containing the meaning of the oil and gas industry terms used in this management’s discussion and analysis follows the “Results of Operations” table in this Item 2.

Cautionary Statement Regarding Forward-Looking Statements

Various statements in this report, including those that express a belief, expectation or intention, as well as those that are not statements of historical fact, are forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). The forward-looking statements may include projections and estimates concerning the timing and success of specific projects, typical well economics and our future reserves, production, revenues, costs, income, capital spending, 3-D seismic operations, interpretation and results and obtaining permits and regulatory approvals. When used in this report, the words “will,” “believe,” “intend,” “expect,” “may,” “should,” “anticipate,” “could,” “estimate,” “plan,” “predict,” “project,” “potential” or their negatives, other similar expressions or the statements that include those words, are intended to identify forward-looking statements, although not all forward-looking statements contain such identifying words.

These forward-looking statements are largely based on our expectations, which reflect estimates and assumptions made by our management. These estimates and assumptions reflect our best judgment based on currently known market conditions and other factors. Although we believe such estimates and assumptions to be reasonable, they are inherently uncertain and involve a number of risks and uncertainties that are beyond our control. In addition, management’s assumptions about future events may prove to be inaccurate. We caution all readers that the forward-looking statements contained in this report are not guarantees of future performance, and we cannot assure any reader that such statements will be realized or the forward-looking events and circumstances will occur. Actual results may differ materially from those anticipated or implied in the forward-looking statements due to the factors listed or referred to in the “Risk Factors” section and elsewhere in this report. All forward-looking statements speak only as of the date of this report. We disclaim any obligation to publicly update or revise any forward-looking statements as a result of new information, future events or otherwise, unless required by law. These cautionary statements qualify all forward-looking statements attributable to us, or persons acting on our behalf. The risks, contingencies and uncertainties relate to, among other matters, the following:

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Overview

Approach Resources Inc. is an independent energy company focused on the exploration, development, production and acquisition of unconventional oil and gas reserves in the Midland Basin of the greater Permian Basin in West Texas, where we lease approximately 138,000 net acres. We believe our concentrated acreage position provides us an opportunity to achieve cost, operating and recovery efficiencies in the development of our drilling inventory. We are currently developing significant resource potential from the Wolfcamp shale oil formation. Additional drilling targets could include the Clearfork, Canyon Sands, Strawn and Ellenburger zones. We sometimes refer to our development project in the Permian Basin as “Project Pangea,” which includes “Pangea West.” Our management and technical team have a proven track record of finding and developing reserves through advanced drilling and completion techniques. As the operator of all of our estimated proved reserves and production, we have a high degree of control over capital expenditures and other operating matters.

At December 31, 2013, our estimated proved reserves were 114.7 million barrels of oil equivalent (“MMBoe”), made up of 40% oil, 29% NGLs, 31% gas and 39% proved developed. Substantially all of our proved reserves are located in the Permian Basin in Crockett and Schleicher Counties, Texas. At June 30, 2014, we owned working interests in 741 producing oil and gas wells.

Second Quarter 2014 Activity

During the three months ended June 30, 2014, we produced 1,286 MBoe, or 14.1 MBoe/d. We drilled 16 horizontal wells and completed 16 horizontal wells. We currently have three horizontal rigs running in Project Pangea.

2014 Capital Expenditures

For the three months ended June 30, 2014, our capital expenditures totaled $92.3 million, consisting of $85.8 million for drilling and completion activities, $3.8 million for infrastructure projects and equipment and $2.7 million for acreage acquisitions and extensions. Our 2014 capital budget is $400 million, including $385 million for horizontal drilling and completion activity and $15 million for infrastructure projects and equipment.

Our 2014 capital budget excludes acquisitions and lease extensions and renewals and is subject to change depending upon a number of factors, including additional data on our Wolfcamp shale oil resource play, results of horizontal drilling and completions, economic and industry conditions at the time of drilling, prevailing and anticipated prices for oil, NGLs and gas, the availability of sufficient capital resources for drilling prospects, our financial results and the availability of lease extensions and renewals on reasonable terms.

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Results of Operations

The following table sets forth summary information regarding oil, NGL and gas revenues, production, average product prices and average production costs and expenses for the three and six months ended June 30, 2014 and 2013. We determine a barrel of oil equivalent using the ratio of six Mcf of natural gas to one Boe, and one barrel of NGLs to one Boe. The ratios of six Mcf of natural gas to one Boe and one barrel of NGLs to one Boe do not assume price equivalency and, given price differentials, the price for a Boe for natural gas or NGLs may differ significantly from the price for a barrel of oil.

Glossary

Bbl. One stock tank barrel, of 42 U.S. gallons liquid volume, used herein to reference oil, condensate or NGLs.

Boe. Barrel of oil equivalent, determined using the ratio of six Mcf of gas to one Bbl of oil equivalent, and one Bbl of NGLs to one Bbl of oil equivalent.

MBbl. Thousand barrels of oil, condensate or NGLs.

MBoe. Thousand barrels of oil equivalent.

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Mcf. Thousand cubic feet of natural gas.

MMBoe. Million barrels of oil equivalent.

MMcf. Million cubic feet of natural gas.

NGLs. Natural gas liquids.

/d. “Per day” when used with volumetric units or dollars.

Three Months Ended June 30, 2014, Compared to Three Months Ended June 30, 2013

Oil, NGL and gas sales. Oil, NGL and gas sales increased $31.1 million, or 74%, for the three months ended June 30, 2014, to $73.4 million, from $42.3 million for the three months ended June 30, 2013. The increase in oil, NGL and gas sales was due to an increase in production volumes ($26 million) and an increase in average realized commodity prices ($5.1 million). Production volumes increased as a result of our continued development in Project Pangea.

Net income. Net income for the three months ended June 30, 2014, was $3.8 million, or $0.10 per diluted share, compared to net income of $7.8 million, or $0.20 per diluted share, for the three months ended June 30, 2013. Net income for the three months ended June 30, 2014, included an unrealized loss on commodity derivatives of $7.7 million and a realized loss on commodity derivatives of $3.3 million. Net income for the three months ended June 30, 2014, decreased due to losses on both our realized and unrealized commodity derivatives ($11 million), higher operating expenses as a result of increased production, and an increase in interest expense, partially offset by higher revenues ($31.1 million).

Oil, NGL and gas production. Production for the three months ended June 30, 2014, totaled 1,286 MBoe (14.1 MBoe/d), compared to production of 817 MBoe (9 MBoe/d) in the prior-year period, a 58% increase. Production for the three months ended June 30, 2014, was 41% oil, 29% NGLs and 30% gas, compared to 42% oil, 28% NGLs and 30% gas in the 2013 period. Production volumes increased during the three months ended June 30, 2014, as a result of our continued development in Project Pangea. We expect production to increase during 2014 due to our development project in the Permain Basin.

Commodity derivatives activities. Our commodity derivatives activity resulted in a realized loss of $3.3 million and $0.7 million for the three months ended June 30, 2014 and 2013, respectively. Our average realized price, including the effect of commodity derivatives, was $54.48 per Boe for the three months ended June 30, 2014, compared to $50.87 per Boe for the three months ended June 30, 2013. Realized gains and losses on commodity derivatives are derived from the relative movement of commodity prices in relation to the fixed pricing in our derivatives contracts for the respective periods. The unrealized loss on commodity derivatives for the three months ended June 30, 2014, was $7.7 million, compared to an unrealized gain of $4.3 million for the three months ended June 30, 2013. As commodity prices increase or decrease, the fair value of the open portion of those positions decreases or increases, respectively.

Historically, we have not designated our derivative instruments as cash-flow hedges. We record our open derivative instruments at fair value on our consolidated balance sheets as either unrealized gains or losses on commodity derivatives. We record changes in such fair value in net income on our consolidated statements of operations under the caption entitled “unrealized (loss) gain on commodity derivatives.”

Lease operating. Our lease operating expenses (“LOE”) increased $3.9 million, or 99%, for the three months ended June 30, 2014, to $7.9 million, or $6.18 per Boe, from $4 million, or $4.89 per Boe, for the three months ended June 30, 2013. The increase in LOE per BOE for the three months ended June 30, 2014, was primarily due to increases in water hauling, well repairs, workovers and maintenance, and compressor rental and repair, partially offset by a decrease in pumpers and supervision. The following table summarizes LOE per Boe.

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Production and ad valorem taxes. Our production and ad valorem taxes increased $1.8 million, or 61%, for the three months ended June 30, 2014, to $4.9 million from $3.1 million for the three months ended June 30, 2013. The increase in production and ad valorem taxes was primarily due to the increase in oil, NGL and gas sales between the two periods. Production and ad valorem taxes were $3.83 per Boe and $3.76 per Boe and approximately 6.7% and 7.3% of oil, NGL and gas sales for the three months ended June 30, 2014 and 2013, respectively.

Exploration. We recorded $2 million, or $1.53 per Boe, and $0.6 million, or $0.68 per Boe, of exploration expense for the three months ended June 30, 2014 and 2013, respectively. Exploration expense for the respective periods resulted primarily from lease expirations and the acquisition of 3-D seismic data.

General and administrative. Our general and administrative expenses (“G&A”) increased $2.2 million, or 42%, to $7.4 million, or $5.75 per Boe, for the three months ended June 30, 2014, from $5.2 million, or $6.40 per Boe, for the three months ended June 30, 2013. The increase in G&A was primarily due to higher salaries and benefits resulting from increased staffing. The increase in G&A was partially offset by a decrease in share-based compensation due to the benefit of forfeited stock awards related to the retirement of one of our executive officers during the three months ended June 30, 2014. The following table summarizes G&A in millions and G&A per Boe.

Depletion, depreciation and amortization. Our depletion, depreciation and amortization expense (“DD&A”) increased $10.1 million, or 55%, to $28.6 million for the three months ended June 30, 2014, from $18.5 million for the three months ended June 30, 2013. Our DD&A per Boe decreased by $0.41 per Boe, or 2%, to $22.21 per Boe for the three months ended June 30, 2014, compared to $22.62 per Boe for the three months ended June 30, 2013. The increase in DD&A expense over the prior-year period was primarily due to higher production. The decrease in DD&A per Boe over the prior-year period was primarily due to lower oil and gas property carrying costs relative to estimated proved developed reserves.

Interest expense, net. Our interest expense, net, increased $2.9 million, or 119%, to $5.4 million for the three months ended June 30, 2014, from $2.5 million for the three months ended June 30, 2013. This increase was primarily due to higher interest expense from the issuance of Senior Notes in June 2013, partially offset by lower average debt balance under our revolving credit facility (the “Credit Facility”). We expect our interest expense to remain higher than the prior-year period as a result of increased borrowings during 2014 as we continue to develop Project Pangea.

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Income taxes. Our income taxes were $2.2 million and $4.2 million for the three months ended June 30, 2014 and 2013, respectively. The decrease in income taxes was primarily due to a decrease in income before income taxes in the 2014 period. Our effective income tax rate for the three months ended June 30, 2014, was 36.2%, compared to 35.1% for the three months ended June 30, 2013.

Six Months Ended June 30, 2014, Compared to Six Months Ended June 30, 2013

Oil, NGL and gas sales. Oil, NGL and gas sales increased $56.8 million, or 72%, for the six months ended June 30, 2014, to $135.3 million, from $78.5 million for the six months ended June 30, 2013. The increase in oil, NGL and gas sales was due to an increase in production volumes ($44.7 million) and an increase in average realized commodity prices ($12.1 million). Production volumes increased as a result of our continued development in Project Pangea.

Net income. Net income for the six months ended June 30, 2014, was $6.7 million, or $0.17 per diluted share, compared to net income of $7.4 million, or $0.19 per diluted share, for the six months ended June 30, 2013. Net income for the six months ended June 30, 2014, included an unrealized loss on commodity derivatives of $13.6 million and a realized loss on commodity derivatives of $4.7 million. Net income for the six months ended June 30, 2014, decreased due to losses on both our realized and unrealized commodity derivatives ($18.3 million), higher operating expenses as a result of increased production, and an increase in interest expense, partially offset by higher revenues ($56.8 million).

Oil, NGL and gas production. Production for the six months ended June 30, 2014, totaled 2,353 MBoe (13.0 MBoe/d), compared to production of 1,571 MBoe (8.7 MBoe/d) in the prior-year period, a 50% increase. Production for the six months ended June 30, 2014 and 2013, was 42% oil, 28% NGLs and 30% gas. Production volumes increased during the six months ended June 30, 2014, as a result of our continued development in Project Pangea. We expect production to increase during 2014 due to our development project in the Permain Basin.

Commodity derivatives activities. Our commodity derivatives activity resulted in a realized loss of $4.7 million and $0.4 million for the six months ended June 30, 2014 and 2013, respectively. Our average realized price, including the effect of commodity derivatives, was $55.52 per Boe for the six months ended June 30, 2014, compared to $49.73 per Boe for the six months ended June 30, 2013. Realized gains and losses on commodity derivatives are derived from the relative movement of commodity prices in relation to the fixed pricing in our derivatives contracts for the respective periods. The unrealized loss on commodity derivatives was $13.6 million for the six months ended June 30, 2014, compared to an unrealized gain of $0.2 million for the six months ended June 30, 2013. As commodity prices increase or decrease, the fair value of the open portion of those positions decreases or increases, respectively.

Lease operating. Our LOE increased $6.4 million, or 69%, for the six months ended June 30, 2014, to $15.8 million, or $6.71 per Boe, from $9.4 million, or $5.97 per Boe, for the six months ended June 30, 2013. The increase in LOE per BOE for the six months ended June 30, 2014, was primarily due to an increase in well repairs, workovers and maintenance, compressor rental and repair, and water hauling, partially offset by decreases in pumpers and supervision. The following table summarizes LOE per Boe.

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Production and ad valorem taxes. Our production and ad valorem taxes increased $3.5 million, or 62%, for the six months ended June 30, 2014, to $9.1 million from $5.6 million for the six months ended June 30, 2013. The increase in production and ad valorem taxes was primarily a function of the increase in oil, NGL and gas sales between the two periods. Production and ad valorem taxes were $3.86 per Boe and $3.58 per Boe and approximately 6.7% and 7.2% of oil, NGL and gas sales for the six months ended June 30, 2014 and 2013, respectively.

Exploration. We recorded $2.7 million, or $1.15 per Boe, and $0.8 million, or $0.52 per Boe, of exploration expense for the six months ended June 30, 2014 and 2013, respectively. Exploration expense for the respective periods resulted primarily from lease expirations and the acquisition of 3-D seismic data.

General and administrative. Our G&A increased $4.3 million, or 37%, to $15.9 million, or $6.77 per Boe, for the six months ended June 30, 2014, from $11.6 million, or $7.41 per Boe, for the six months ended June 30, 2013. The increase in G&A was primarily due to higher salaries and share-based compensation resulting from increased staffing. Share-based compensation remained consistent for the six months ended June 30, 2014 compared to the prior-year period due to the benefit of forfeited stock awards of $1.1 million related to the retirement of one of our executive officers during the six months ended June 30, 2014. The following table summarizes G&A in millions and G&A per Boe.

Depletion, depreciation and amortization. Our DD&A increased $16.7 million, or 47%, to $52.2 million for the six months ended June 30, 2014, from $35.5 million for the six months ended June 30, 2013. Our DD&A per Boe decreased by $0.45 per Boe, or 2%, to $22.17 per Boe for the six months ended June 30, 2014, compared to $22.62 per Boe for the six months ended June 30, 2013. The increase in DD&A expense over the prior-year period was primarily due to higher production. The decrease in DD&A per Boe over the prior-year period was primarily due to lower oil and gas property carrying costs relative to estimated proved developed reserves.

Interest expense, net. Our interest expense, net, increased $6.8 million, or 185%, to $10.5 million for the six months ended June 30, 2014, from $3.7 million for the six months ended June 30, 2013. This increase was primarily due to higher interest expense from the issuance of Senior Notes in June 2013, partially offset by lower average debt balance under our Credit Facility. We expect our interest expense to remain higher than the prior-year period as a result of increased borrowings during 2014 as we continue to develop Project Pangea.

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Income taxes. Our income taxes were $3.8 million and $4 million for the six months ended June 30, 2014 and 2013, respectively. The decrease in income taxes was primarily due to a decrease in income before income taxes in the 2014 period. Our effective income tax rate for the six months ended June 30, 2014, was 36.3%, compared to 35.1% for the six months ended June 30, 2013.

Liquidity and Capital Resources

We generally will rely on cash generated from operations, borrowings under our Credit Facility and, to the extent that credit and capital market conditions will allow, future public equity and debt offerings to satisfy our liquidity needs. Our ability to fund planned capital expenditures and to make acquisitions depends upon our future operating performance, availability of borrowings under our Credit Facility, and more broadly, on the availability of equity and debt financing, which is affected by prevailing economic conditions in our industry and financial, business and other factors, some of which are beyond our control. We cannot predict whether additional liquidity from equity or debt financings beyond our Credit Facility will be available on acceptable terms, or at all, in the foreseeable future.

Our cash flow from operations is driven by commodity prices, production volumes and the effect of commodity derivatives. Commodity prices are affected by national and international economic and political environments, national and global supply and demand for hydrocarbons, seasonal influences of weather and other factors beyond our control. Cash flows from operations are primarily used to fund development of our oil and gas properties.

We believe we have adequate liquidity from cash generated from operations and unused borrowing capacity under our Credit Facility for current working capital needs and maintenance of our current development project. However, we may determine to use various financing sources, including the issuance of common stock, preferred stock, debt, convertible securities and other securities for future development of reserves, acquisitions, additional working capital or other liquidity needs, if such financing is available on acceptable terms. We cannot guarantee that such financing will be available on acceptable terms or at all. Using some of these financing sources may require approval from the lenders under our Credit Facility.

Liquidity

We define liquidity as funds available under our Credit Facility, cash and cash equivalents. At June 30, 2014, and December 31, 2013, we had $46 million and no outstanding borrowings under our Credit Facility and liquidity of $404.1 million and $408.4 million, respectively. The table below summarizes our liquidity position at June 30, 2014, and December 31, 2013 (dollars in thousands).

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In May 2014, we entered into an amended and restated $1 billion Credit Facility with an initial borrowing base of $450 million. Additional information regarding the Credit Facility is included in Note 4. “Long-Term Debt.”

Working Capital

Our working capital is affected primarily by our cash and cash equivalents balance and our capital spending program. We had a working capital deficit of $69 million at June 30, 2014, compared to a working capital surplus of $6 million at December 31, 2013. The primary reason for the change in working capital was an increase in accrued liabilities, and a decrease in our cash balance due to an increase in our capital expenditures. To the extent we operate, or end fiscal year 2014, with a working capital deficit, we expect such deficit to be more than offset by liquidity available under our Credit Facility.

Cash Flows

The following table summarizes our sources and uses of funds for the periods noted (in thousands).

Operating Activities

Cash flows provided by operating activities increased by 91%, or $40.8 million, to $85.7 million during the six months ended June 30, 2014, compared to the prior-year period. The increase in our cash flows provided by operating activities was primarily due to an increase in oil, NGL and gas sales from higher production and the timing of payments and receipts of working capital components, partially offset by an increase in total expenses.

Investing Activities

Cash flows used in investing activities increased by $61.6 million for the six months ended June 30, 2014, to $187.8 million, compared to the prior-year period. Our capital expenditures for the six months ended June 30, 2014, were primarily attributable to drilling and development ($182.9 million), infrastructure projects and equipment ($9.9 million) and acreage acquisitions and extensions ($2.9 million). Additionally, $7.4 million in restricted cash was released from escrow related to the sale of our interest in the Wildcat pipeline, offset by $0.2 million in post-closing working capital adjustments related to the sale. During the six months ended June 30, 2014, we drilled a total of 32 horizontal wells and completed 35 horizontal wells in Project Pangea.

Financing Activities

During the six months ended June 30, 2014, cash flows provided by financing activities decreased by $92.1 million, compared to the prior-year period. We had $46 million of outstanding borrowings under our Credit Facility at June 30, 2014. During the six months ended June 30, 2014, net cash flows provided by financing activities included borrowings under our Credit Facility of $114.4 million that were partially offset by repayments of outstanding borrowings under our Credit Facility of $68.4 million. This compares

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to the six months ended June 30, 2013, when we had net cash flows provided by financing activities that primarily included borrowings under our Credit Facility of $130 million and net proceeds from our offering of the Senior Notes of $243 million that were partially offset by repayments of outstanding borrowings under our Credit Facility of $236 million.

Credit Facility

At June 30, 2014, the borrowing base under our Credit Facility was $450 million, with maximum commitments from the lenders of $1 billion and a maturity date of May 7, 2019. We had outstanding borrowings of $46 million under our Credit Facility at June 30, 2014, compared to no outstanding borrowings at December 31, 2013. The weighted average interest rate applicable to borrowings under our credit facility for the six months ended June 30, 2014, was 2%. Additional information regarding our credit arrangements is included in Note 4. “Long-Term Debt.”

To date, we have experienced no disruptions in our ability to access our Credit Facility. However, our lenders have substantial ability to reduce our borrowing base on the basis of subjective factors, including the loan collateral value that each lender, in its discretion and using the methodology, assumptions and discount rates as such lender customarily uses in evaluating oil and gas properties, assigns to our properties.

Contractual Obligations

Our contractual obligations include long-term debt, daywork drilling contracts, operating lease obligations, asset retirement obligations and employment agreements with our executive officers. On January 3, 2014, we entered into an employment agreement with Sergei Krylov as the Company’s Executive Vice President and Chief Financial Officer. Our maximum commitment under Mr. Krylov’s employment agreement, which would apply if Mr. Krylov were terminated without cause, is $1.3 million. Since December 31, 2013, there have been no other material changes to our contractual obligations. In August 2014, we extended our existing gas purchase and processing agreement with DCP Midstream, LP through August 2023.

Off-Balance Sheet Arrangements

From time to time, we enter into off-balance sheet arrangements and transactions that can give rise to off-balance sheet obligations. As of June 30, 2014, the off-balance sheet arrangements and transactions that we have entered into include undrawn letters of credit and operating lease agreements. We do not believe that these arrangements have or are reasonably likely to have a current or future material effect on our financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources.

General Trends and Outlook

Our financial results depend upon many factors, particularly the price of oil and gas. Commodity prices are affected by changes in market demand, which is impacted by domestic and foreign supply of oil and gas, overall domestic and global economic conditions, commodity processing, gathering and transportation availability and the availability of refining capacity, price and availability of alternative fuels, price and quantity of foreign imports, domestic and foreign governmental regulations, political conditions in or affecting other gas producing and oil producing countries, weather and technological advances affecting oil and gas consumption. As a result, we cannot accurately predict future oil and gas prices, and therefore, we cannot determine what effect increases or decreases will have on our capital program, production volumes and future revenues. A substantial or extended decline in oil and gas prices could have a material adverse effect on our business, financial condition, results of operations, quantities of oil and gas reserves that may be economically produced and liquidity that may be accessed through our borrowing base under our Credit Facility and through capital markets.

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In addition to production volumes and commodity prices, finding and developing sufficient amounts of oil and gas reserves at economical costs are critical to our long-term success. Future finding and development costs are subject to changes in the industry, including the costs of acquiring, drilling and completing our projects. We focus our efforts on increasing oil and gas reserves and production while controlling costs at a level that is appropriate for long-term operations. Our future cash flow from operations will depend on our ability to manage our overall cost structure.

Like all oil and gas production companies, we face the challenge of natural production declines. Oil and gas production from a given well naturally decreases over time. Additionally, our reserves have a rapid initial decline. We attempt to overcome this natural decline by drilling to develop and identify additional reserves, farm-ins or other joint drilling ventures, and by acquisitions. However, during times of severe price declines, we may from time to time reduce current capital expenditures and curtail drilling operations in order to preserve liquidity. A material reduction in capital expenditures and drilling activities could materially reduce our production volumes and revenues and increase future expected costs necessary to develop existing reserves.

We also face the challenge of financing exploration, development and future acquisitions. We believe we have adequate liquidity from cash generated from operations and unused borrowing capacity under our Credit Facility for current working capital needs and maintenance of our current development project. However, we may determine to use various financing sources, including the issuance of common stock, preferred stock, debt, convertible securities and other securities for future development of reserves, acquisitions, additional working capital or other liquidity needs, if such financing is available on acceptable terms. We cannot guarantee that such financing will be available on acceptable terms or at all. Using some of these financing sources may require approval from the lenders under our Credit Facility.

Item 3. Quantitative and Qualitative Disclosures About Market Risk.

Some of the information below contains forward-looking statements. The primary objective of the following information is to provide forward-looking quantitative and qualitative information about our potential exposure to market risks. The term “market risk” refers to the risk of loss arising from adverse changes in oil and gas prices, and other related factors. The disclosure is not meant to be a precise indicator of expected future losses, but rather an indicator of reasonably possible losses. This forward-looking information provides an indicator of how we view and manage our ongoing market risk exposures. Our market risk sensitive instruments were entered into for commodity derivative and investment purposes, not for trading purposes.

Commodity Price Risk

Given the current economic outlook, we expect commodity prices to remain volatile. Even modest decreases in commodity prices can materially affect our revenues and cash flow. In addition, if commodity prices remain suppressed for a significant amount of time, we could be required under successful efforts accounting rules to perform a write down of our oil and gas properties.

We enter into financial swaps and options to reduce the risk of commodity price fluctuations. We do not designate such instruments as cash flow hedges. Accordingly, we record open commodity derivative positions on our consolidated balance sheets at fair value and recognize changes in such fair values as other income (expense) on our consolidated statements of operations as they occur.

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The following table provides our outstanding commodity derivative positions at June 30, 2014.

Subsequent to June 30, 2014, we entered into two crude oil collars covering a total of 1,000 Bbls per day for 2015 at a floor price of $90.00/Bbl and a ceiling price of $102.50/Bbl.

At June 30, 2014, the fair value of our open derivative contracts was a net liability of $15.8 million, compared to a net liability of $2.2 million at December 31, 2013.

JPMorgan Chase Bank, N.A. and KeyBank National Association are currently the only counterparties to our commodity derivatives positions. We are exposed to credit losses in the event of nonperformance by counterparties on our commodity derivatives positions. However, we do not anticipate nonperformance by the counterparties over the term of the commodity derivatives positions. JPMorgan is the administrative agent and a participant, and KeyBank is the documentation agent and a participant, in our Credit Facility, and the collateral for the outstanding borrowings under our Credit Facility is used as collateral for our commodity derivatives.

Unrealized gains and losses, at fair value, are included on our consolidated balance sheets as current or non-current assets or liabilities based on the anticipated timing of cash settlements under the related contracts. Changes in the fair value of our commodity derivative contracts are recorded in earnings as they occur and included in other income (expense) on our consolidated statements of operations. We estimate the fair values of swap contracts based on the present value of the difference in exchange-quoted forward price curves and contractual settlement prices multiplied by notional quantities. We internally valued the option contracts using industry-standard option pricing models and observable market inputs. We use our internal valuations to determine the fair values of the contracts that are reflected on our consolidated balance sheets. Realized gains and losses are also included in other income (expense) on our consolidated statements of operations.

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For the six months ended June 30, 2014, we recorded an unrealized loss on commodity derivatives of $13.6 million from the change in fair value of our commodity derivatives positions, compared to an unrealized gain of $0.2 million for the six months ended June 30, 2013. A hypothetical 10% increase in commodity prices would have resulted in a $20.3 million decrease in the fair value of our commodity derivative positions recorded on our balance sheet at June 30, 2014, and a corresponding increase in the unrealized loss on commodity derivatives recorded on our consolidated statement of operations for the six months ended June 30, 2014.

Item 4. Controls and Procedures.

Evaluation of Disclosure Controls and Procedures

We maintain disclosure controls and procedures that are designed to ensure that information required to be disclosed in the reports we file under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms. Such controls include those designed to ensure that information required to be disclosed by us in the reports that we file or submit under the Exchange Act is accumulated and communicated to management, including the President and Chief Executive Officer (“CEO”) and Chief Financial Officer (“CFO”), as appropriate, to allow timely decisions regarding required disclosure.

Our management, with the participation of our CEO and CFO, has evaluated the effectiveness of our disclosure controls and procedures (as defined in Rule 13a-15(e) promulgated under the Exchange Act) as of June 30, 2014. Based on this evaluation, the CEO and CFO have concluded that, as of June 30, 2014, our disclosure controls and procedures were effective, in that they ensure that information required to be disclosed by us in the reports that we file or submit under the Exchange Act is (1) recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms, and (2) accumulated and communicated to our management, including our CEO and CFO, as appropriate to allow timely decisions regarding required disclosure.

Internal Control over Financial Reporting

There were no changes made in our internal control over financial reporting (as defined in Rule 13a-15(f) promulgated under the Exchange Act) during the three months ended June 30, 2014, that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

Limitations Inherent in All Controls

Our management, including the CEO and CFO, recognizes that the disclosure controls and procedures and internal controls (discussed above) cannot prevent all errors or all attempts at fraud. Any controls system, no matter how well-crafted and operated, can only provide reasonable, and not absolute, assurance of achieving the desired control objectives. Because of the inherent limitations in any control system, no evaluation or implementation of a control system can provide complete assurance that all control issues and all possible instances of fraud have been or will be detected.

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PART II—OTHER INFORMATION

Item 1. Legal Proceedings.

There have been no material developments in the legal proceedings described in Part I, Item 3. “Legal Proceedings” of our Annual Report on Form 10-K for the year ended December 31, 2013, filed with the SEC on February 25, 2014.

Item 1A. Risk Factors.

In addition to the other information set forth in this report, you should carefully consider the risks discussed in the following report that we have filed with the SEC, which risks could materially affect our business, financial condition and results of operations: Annual Report on Form 10-K for the year ended December 31, 2013, under the headings Item 1. “Business – Markets and Customers; Competition; and Regulation,” Item 1A. “Risk Factors,” Item 7. “Management’s Discussion and Analysis of Financial Condition and Results of Operations – General Trends and Outlook” and Item 7A. “Quantitative and Qualitative Disclosures about Market Risk” filed with the SEC on February 25, 2014.

There have been no material changes to the risk factors discussed in our Annual Report on Form 10-K for the year ended December 31, 2013, filed with the SEC on February 25, 2014, which is accessible on the SEC’s website at www.sec.gov and our website at www.approachresources.com.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.

The following table provides information relating to our purchase of shares of our common stock during the three months ended June 30, 2014. The repurchases reflect shares withheld upon vesting of restricted stock under our 2007 Stock Incentive Plan to satisfy statutory minimum tax withholding obligations.

ISSUER PURCHASES OF EQUITY SECURITIES

Item 6. Exhibits.

See “Index to Exhibits” following the signature page of this report for a description of the exhibits furnished as part of this report.

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

Index to Exhibits

Exhibit 10.1

Execution Copy

EXECUTIVE GRANT AND SEPARATION AGREEMENT

This Executive Grant and Separation Agreement (the “Agreement”) is entered into as of May 12, 2014, by and between APPROACH RESOURCES INC., a Delaware corporation (the “Company”), and RALPH P. MANOUSHAGIAN, an individual residing in the State of Texas (“Employee”).

RECITALS

WHEREAS, Employee has been employed by the Company pursuant to the Employment Agreement between the parties effective as of January 24, 2011 (the “Employment Agreement”);

WHEREAS, Employee has previously been awarded restricted shares of the Company’s common stock, $0.01 par value per share (the “Common Stock”) under the Company’s 2007 Stock Incentive Plan, as amended (the “Plan”) pursuant to separate grants on each of November 14, 2007, June 3, 2009, August 6, 2010, March 7, 2011, February 21, 2012, and February 20, 2013 (collectively, the “Restricted Stock Award Agreements”) and under which Employee holds 66,684 outstanding unvested shares subject to performance and time vesting requirements;

WHEREAS, the parties desire to enter into this Agreement to, except as otherwise provided herein, supersede and fully replace all provisions of the Employment Agreement and set forth the terms of the separation of Employee’s employment from the Company and Employee’s release of any claims or causes of action that he may have arising from his employment with the Company, including but not limited to any claims arising from the separation from such employment;

NOW, THEREFORE, in consideration of the mutual promises and covenants contained in this Agreement and other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the parties agree to the following terms:

TERMS

1. Separation of Employment. The parties acknowledge and agree that Employee’s employment as Executive Vice President, Land and all other positions with the Company and all subsidiaries and affiliates will end effective on May 16, 2014 (the “Separation Date”).

2. Consideration. Employee acknowledges and agrees that, but for entry into this Agreement, the Company has no obligation to pay Employee the sums specified in Paragraph 3 below and that said sums are fair, adequate and independent valuable consideration for the promises, releases and waivers contained in this Agreement. Provided Employee executes this Agreement within the twenty-one (21) day period referenced below (and is not revoked by him within seven (7) days of such execution), Employee shall be granted the following consideration:

(a) Cash Severance – Salary and Vacation Days: Pursuant to Paragraph 7(e)(i) of the Employment Agreement (dealing with a non-renewal of the Employment Agreement) and subject to the terms described therein, Employee shall be paid a lump sum in cash equal to 150% of Employee’s current base salary, or a total of $360,000, less required tax withholdings, within 20 days after the Separation Date. In addition, on or before the date of payment set forth in the preceding sentence, Employee shall be paid a lump sum amount in cash, less any required withholdings, for Employee’s accrued, unused vacation days at the rate of $923 per day. As of the day this Agreement is signed, Employee has 27.5 days of accrued, unused vacation days.

(b) [Intentionally omitted.]

(c) Cash Severance – Continuation of Other Benefits: Pursuant to Paragraph 7(e)(iii) of the Employment Agreement, at the time of the payment of the amount set forth in Paragraph 2(a) above, Employee shall be paid a lump sum in cash a total of $19,070, less required withholdings, attributable to health coverage for Employee during the applicable 18-month COBRA continuation period.

(d) Restricted Stock: Pursuant to Paragraph 2(b) of the Restricted Stock Award Agreements, as of the Separation Date, all of Employee’s 66,684 outstanding unvested restricted shares shall be forfeited entirely and for no consideration.

3. Grant of Restricted Stock Units. Pursuant to the Restricted Stock Unit Grant and Agreement, attached hereto as Appendix A, Employee shall be granted the number of Restricted Stock Units listed in such agreement on the date provided thereunder.

4. Prior Rights and Obligations. This Agreement extinguishes all rights, if any, which Employee may have, contractual or otherwise, relating to or arising out of his employment with the Company. In entering into this Agreement, Employee expressly acknowledges and agrees that he has received all leaves (paid and unpaid) to which he was entitled during his employment and, as of the date that Employee executes this Agreement, he has received all wages and been paid all sums that he is owed by the Company, except for amounts remaining to be paid under this Agreement.

5. [Intentionally omitted.]

6. Return of Company Materials and Confidential Information. Employee agrees that, as of the Separation Date, he has returned to the Company: (a) all Company documents and other materials, including without limitation, electronic or “hard” data, bank files, software, computers (laptop or otherwise), policy manuals, office supplies, keys and any other tangible item belonging to the Company; and (b) all confidential and/or proprietary information in his

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possession, including but not limited to, any customer information or records, strategic plans, business policies, financial information, intellectual property, methods of operation, implementation strategies, and any documents or materials consisting of or containing the Company’s trade secrets or other legally protectable information in his possession or in the possession of any person or entity acting on his behalf.

7. Release, Covenants, and Continuing Obligations.

(a) Release: Employee agrees to release and discharge the Company and any parent, subsidiary, predecessor, successor, assign or affiliated entity, along with their respective past, present, and future owners, partners, officers, directors, employees, agents, attorneys, successors, administrators and insurers (collectively the “Company Parties”), from any and all claims, demands, liabilities and causes of action, whether statutory or common law, including, but not limited to, any claim for salary, severance, benefits, payments, expenses, costs, damages, penalties, compensation, remuneration, wages, contractual entitlements; and all claims or causes of action relating to any matter occurring on or prior to the date that Employee executed this Agreement, including without limitation (i) any alleged violation of: (A) the Age Discrimination in Employment Act of 1967; (B) Title VII of the Civil Rights Act of 1964; (C) the Civil Rights Act of 1991; (D) Sections 1981 through 1988 of Title 42 of the United States Code; (E) the Employee Retirement Income Security Act; (F) the Immigration Reform Control Act; (G) the Americans with Disabilities Act; (H) the National Labor Relations Act; (I) the Occupational Safety and Health Act; (J) the Family and Medical Leave Act; (K) any state or federal anti-discrimination law; (L) any state or federal wage and hour law; (M) any other local, state or federal law, regulation or ordinance; (ii) any public policy, contract, tort, or common law claim; (iii) any and all claims for costs, fees, or other expenses including attorneys’ fees incurred in the matters referenced herein; and (iv) any and all claims he may have arising as the result of any alleged breach of any contract, incentive compensation plan or agreement or stock award plan or agreement with any Company Party, including without limitation the Plan, Restricted Stock Award Agreements, STIP and Employment Agreement (collectively, the “Released Claims”). This Agreement is not intended to indicate that any such claims exist or that, if they do exist, they are meritorious. Rather, Employee is simply agreeing that, in exchange for the consideration recited in Paragraph 2 and 3 of this Agreement, any and all potential claims of this nature that he may have against the Company Parties, regardless of whether they actually exist, are expressly settled, compromised and waived. Notwithstanding this release of liability, nothing in this Agreement prevents Employee from filing any non-legally waivable claim, including a challenge to the validity of this Agreement with the Equal Employment Opportunity Commission (“EEOC”), or comparable state or local agency, or participating in any investigation or proceeding conducted by the EEOC or comparable state or local agency; however, Employee understands and agrees that he is waiving any and all rights to recover any monetary or personal relief or recovery as a result of such EEOC or comparable state or local agency proceeding or

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subsequent legal actions. Further, in no event shall the Released Claims include: (i) any claim which arises after the date this Agreement is executed by Employee, including any claim to enforce his rights under this Agreement; or (ii) any claim to any vested benefits under an employee pension or retirement plan. Finally, Employee represents, warrants and agrees that at the time that Employee signs this Agreement, he has not brought or joined any claims, appeals, complaints, charges or lawsuits against the Company Parties and has made no assignment, sale, delivery, transfer or conveyance of any rights he has asserted or may have against any of the Company Parties with respect to any Released Claim.

(b) Non-Disclosure of Agreement: Employee agrees that, except to the extent disclosed in any public filings required by law, the terms of this Agreement are confidential and that he will not voluntarily disclose to any third person, apart from his attorney, tax advisors and immediate family, the existence, terms or conditions of this Agreement or to cause any third person to disclose the existence, terms or conditions of this Agreement, except as required by law or compelled by any governmental authority. If required by law or compelled by a government authority to involuntarily disclose the existence, terms or conditions of this Agreement, Employee agrees to give the Company at least five (5) business days’ notice.

(c) Non-Disparagement: Both Employee and the Company agree that the Company will communicate no adverse or derogatory information to anyone concerning Employee or his employment, and Employee, likewise, will communicate no such information concerning the Company or any persons, corporations or other entities having any relationship with any part of the Company.

(d) Non-Disclosure of Confidential Information: Paragraph 14 of the Employment Agreement is incorporated in its entirety by reference herein.

(e) Non-Competition, Non-Solicitation: The purpose of Subparagraphs 7(d) and 7(e) are to protect the Company from unfair loss of goodwill and/or business advantage.

(i) Paragraph 15 of the Employment Agreement is incorporated in its entirety by reference herein. To the extent there are any inconsistencies between that Paragraph 15 and this Agreement, this Agreement controls.

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(ii) Notwithstanding the foregoing, Employee further agrees that for the period during which any Restricted Stock Units granted pursuant to the Restricted Stock Unit Grant and Agreement continue to vest, or for one (1) year following the end of the Post-Termination Non-Compete Term, as defined in Paragraph 15 of the Employment Agreement, whichever ends earlier (the “Restricted Period”), Employee shall refrain from accepting other employment with, or providing services to any company or other entity that:

(A) as of the Separation Date or as of the end of the six-month period following such Separation Date competes with the Company in the upstream exploration and production business, which for the avoidance of doubt includes any leasing, acquiring, exploring, developing, or producing hydrocarbons and related products (the “E&P Business”) within the boundaries of, or within a 25-mile radius of the boundaries of, any mineral property interest of the Company or its affiliates (including, without limitation, a mineral lease, overriding royalty interest, production payment, net profits interest, mineral fee interest, or option or right to acquire any of the foregoing, or an area of mutual interest as designated pursuant to contractual agreements between the Company or its affiliates and any third party) or any other property on which the Company or its affiliates have an option, right, license, or authority to conduct or direct exploratory activities, such as three dimensional seismic acquisition or other seismic, geophysical and geochemical activities (but not including any preliminary geological mapping); or

(B) is an E&P Business that as of the Separation Date or as of the end of the six-month period following such Separation Date, both (x) is headquartered within a 60-mile radius of the Company’s headquarters located at One Ridgmar Centre, 6500 West Freeway, Suite 800, Fort Worth, Texas 76116, where Employee was employed, and (y) has a stockholders’ or members’ equity, or equivalent measure of equity capital under generally accepted accounting principles, of $200 million or more. Notwithstanding any other provision of this Agreement, the Company agrees that its sole and exclusive remedy for a breach of this Paragraph 7(e)(ii)(B) by Employee shall be the forfeiture of any unearned Restricted Stock Units that have not become available as set forth in the schedule contained in the attached Appendix A.

(iii) Notwithstanding the foregoing, nothing in this Paragraph 7(e) shall preclude Employee from making personal investments in securities of oil and gas companies that are registered on a national stock exchange, if the aggregate amount owned by Employee and all immediate family members and affiliates does not exceed 1% of such company’s outstanding securities.

(f) Post-Separation Cooperation: Following the Separation Date, Employee will cooperate with the Company at its request to assist with existing or future investigations, proceedings, litigation, examinations or other fact-finding or adjudicative proceedings, public or private, involving any of the Company Parties. This obligation includes promptly meeting with representatives of the Company at reasonable times upon their request, and providing information and, where applicable, testimony, that is truthful, accurate and complete, according to information known to Employee. From and after the Service Period, the Company will pay Employee $200 for each hour that Employee provides such assistance at the Company’s request. Employee will submit to the Company a statement no later than thirty (30) days after providing

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any such services under this Paragraph 7(f) setting out the number of hours such services were performed and the Company will pay for such services within thirty (30) days after receipt of such statement. The Company also will reimburse Employee, within thirty (30) days after submission of substantiating documentation, for reasonable out-of-pocket travel, lodging and other incidental expenses (but not attorney’s fees) Employee incurs in providing such assistance, provided that expenses over $500 have been approved in advance by an authorized representative of the Company and Employee submits such documentation within thirty (30) days after the expense is incurred. If requested by any of the Company Parties, Employee will make good faith efforts to travel to such locations as any of the Company Parties may reasonably request to provide such assistance provided that travel time will be billed at the above rate.

8. Enforcement of Covenants and Remedies.

(a) Enforcement of Covenants: Employee acknowledges and agrees that the Company previously fulfilled its agreement to provide him with confidential information and that his covenants in Paragraphs 6 and 7 of this Agreement are ancillary to that prior enforceable agreement and are supported by independent, valuable consideration. Employee further acknowledges and agrees that the limitations as to time, geographical area, and scope of activity to be restrained by those covenants in Paragraphs 7(d) and 7(e) are reasonable and acceptable to Employee and do not import any greater restraint than is reasonably necessary to protect the Company’s goodwill, confidential information, and other legitimate business interests. Employee further agrees that if, at some later date, a court of competent jurisdiction determines that any of the covenants in Paragraphs 7(d) or 7(e) are unenforceable, any such covenants shall be reformed by the court and enforced to the maximum extent permitted under law.

(b) Remedies: In the event of a breach or threatened breach by Employee of any of his covenants in Paragraphs 6 or 7 of this Agreement, the Company shall be entitled to equitable relief by temporary restraining order, temporary injunction, or permanent injunction or otherwise, in addition to other legal and equitable relief to which it may be entitled, including any and all monetary damages that the Company may incur as a result of such breach, violation, or threatened breach or violation. Employee acknowledges that damages are an inadequate remedy for any breach of the terms and conditions set forth in Paragraphs 6 or 7 of this Agreement and agrees that the Company may pursue any remedy available to it concurrently or consecutively in any order as to any breach, violation, or threatened breach or violation, and the pursuit of one of such remedies at any time shall not be deemed an election of remedies or waiver of the right to pursue any other of such remedies as to such breach, violation, or threatened breach or violation, or as to any other breach, violation, or threatened breach or violation.

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9. Employee Representations. Employee acknowledges that:

(a) Employee is hereby advised to consult with an attorney before signing this Agreement and has had adequate opportunity to do so.

(b) Employee would not otherwise have been entitled to the consideration described in Paragraph 3 of this Agreement and that Company agreed to provide such consideration in return for Employee’s agreement to be bound by the terms of this Agreement.

(c) Employee has been given at least twenty-one (21) days to review this Agreement and understands that if he does not accept this Agreement by May 12, 2014, this offer will expire.

(d) Employee has seven (7) days after signing this Agreement to revoke it. This Agreement will not become effective or enforceable until the revocation period has expired without Employee’s revocation. Any notice of revocation of the Agreement is effective only if received by the Company in writing by the seventh day after Employee signs this Agreement at the following address: One Ridgmar Centre, 6500 West Freeway, Suite 800, Fort Worth, Texas 76116. Employee understands that if he revokes his acceptance of this Agreement pursuant to this Paragraph 9(d), the Company will not provide him with any severance payment described in Paragraph 2, above, and all other terms of this Agreement will become null and void.

10. Corporate Changes. In the event of any consolidation or merger of the Company into or with any other corporation during the term of this Agreement, or the sale of all or substantially all of the assets of the Company to another corporation during the term of this Agreement, such successor corporation shall assume this Agreement and become obligated to perform all of the terms and provisions hereof applicable to the Company, and Employee’s obligations hereunder shall continue in favor of such successor corporation.

11. Voluntary Agreement. Employee acknowledges and agrees that he has carefully read this Agreement and understands that, except as expressly reserved herein, it is a release of all claims, known or unknown, past or present, including all claims under the Age Discrimination in Employment Act. Employee further warrants that he executes this Agreement of his own free will, after having a reasonable period of time to review, study and deliberate regarding its meaning and effect, and after being advised to consult an attorney. Finally, Employee enters into this Agreement fully knowing its effect and he does so voluntarily, in exchange for the consideration stated above.

12. Dispute Resolution. If any dispute arising out of or relating to this Agreement, including any question regarding its existence or validity (a “Dispute”) cannot be amicably resolved by the parties, the parties shall submit the Dispute to nonbinding mediation as soon as

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reasonably possible after the Dispute arose. If complete agreement cannot be reached within five (5) calendar days of submission to mediation, either party may file a civil action against the other party in any court of competent jurisdiction permitted under Paragraph 17.

Waiver of Right to Jury Trial. NOTWITHSTANDING ANY OTHER PROVISION IN THIS AGREEMENT, THE PARTIES SHALL, AND HEREBY DO, IRREVOCABLY WAIVE THE RIGHT TO TRIAL BY JURY WITH RESPECT TO ANY DISPUTE ARISING FROM THIS AGREEMENT OR THE EMPLOYMENT AGREEMENT. IN ADDITION, EMPLOYEE SHALL, AND HEREBY DOES, IRREVOCABLY WAIVE THE RIGHT TO PARTICIPATE IN ANY CLASS OR COLLECTIVE ACTION WITH RESPECT TO ANY DISPUTE.

13. Entire Agreement. Employee and the Company agree that this Agreement contains the entire agreement between the parties, and supersedes all prior agreements or understandings between the parties, both written and oral, between the parties pertaining to matters encompassed in this Agreement, including, without limitation the Employment Agreement. Employee agrees that the Company has not made any promise or representation to him concerning this Agreement not expressed in this Agreement, and that, in signing this Agreement, he is not relying on any prior oral or written statement or representation by the Company, but is instead relying solely on his own judgment and his legal and tax advisors, if any.

14. Amendment of Agreement. This Agreement cannot be modified except by a written agreement signed by both parties and specifically identified as an amendment to this Agreement. Notwithstanding the previous sentence, the Company may modify or amend this Agreement in its sole discretion at any time without the further consent of the Employee in any manner necessary to comply with applicable law and regulations or the listing or other requirements of any stock exchange upon which the Company is listed; provided, that such amendment is immaterial and would not cause a material reduction of any benefits provided to Employee hereunder.

15. Waiver. The waiver by either party of a breach of any term of this Agreement shall not operate or be construed as a waiver of a subsequent breach of the same provision by either party or of the breach of any other term of provision of this Agreement.

16. Severability. The invalidity or unenforceability of any provision of this Agreement shall not affect the validity or enforceability of any other provision of this Agreement. If any provision may be made enforceable by limitation, then such provision shall be deemed so limited and shall be enforceable to the maximum extent permitted by applicable law. This Agreement will be binding upon and inure to the benefit of the parties’ respective successors, assigns, legal representatives and heirs.

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17. Governing Law; Venue. This Agreement shall be governed by the laws of the State of Texas, without regard to its conflict-of-laws principles. Employee and the Company hereby irrevocably consent to the binding and exclusive venue for any Dispute between the parties arising out of or related to this Agreement being in the state or federal court of competent jurisdiction that regularly conducts proceedings in Tarrant County, Texas. Nothing in this Agreement, however, precludes Employee or the Company from seeking to remove a civil action from any state court to federal court.

18. Notices. Any notice to be given to the Company hereunder shall be deemed sufficient if addressed to the Company in writing and delivered or mailed by certified or registered mail to its offices at One Ridgmar Centre, 6500 West Freeway, Suite 800, Fort Worth, Texas 76116, or such other address as the Company may hereafter designate. Any notice to be given to Employee hereunder shall be delivered or mailed by certified or registered mail to: 2425 Brookgreen Ct., Bedford, Texas 76021, or such other address as Employee may hereafter designate.

19. Counterparts. This Agreement may be executed in one or more counterparts, each of which shall be deemed an original and all of which together shall be considered one and the same agreement. The delivery of this Agreement in the form of a clearly legible facsimile or electronically scanned version by e-mail shall have the same force and effect as delivery of the originally executed document.

20. Right to Consult a Tax Advisor. Notwithstanding any contrary provision in this Agreement, Employee shall be solely responsible for any risk that the tax treatment of all or part of any payments provided by this Agreement may be affected by Section 409A, which may impose significant adverse tax consequences on him, including accelerated taxation, a 20% additional tax, and interest. Because of the potential tax consequences, Employee has the right, and is encouraged by this paragraph, to consult with a tax advisor of his choice before signing this Agreement.

[Signature Page Follows]

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Date: May 12, 2014

Attachments: Appendix A – Restricted Stock Unit Grant and Agreement

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APPENDIX A

APPROACH RESOURCES INC.

2007 STOCK INCENTIVE PLAN

RESTRICTED STOCK UNIT GRANT AND AGREEMENT

This Restricted Stock Unit Grant and Agreement (“Agreement”) is made and entered into as of the date set forth below by and between Approach Resources Inc., a Delaware corporation (the “Company”) and you;

WHEREAS, the Company agrees to grant you this restricted stock unit award;

WHEREAS, the Company adopted the Approach Resources Inc. 2007 Stock Incentive Plan, as it may be amended from time to time (the “Plan”) under which the Company is authorized to grant restricted stock units to certain Employees, Outside Directors and other service providers of the Company;

WHEREAS, a copy of the Plan has been furnished to you and shall be deemed a part of this Agreement as if fully set forth herein; and

WHEREAS, you desire to accept the restricted stock unit award made pursuant to this Agreement;

NOW, THEREFORE, in consideration of and mutual covenants set forth herein and for other valuable consideration hereinafter set forth, the parties agree as follows:

1. The Grant. Subject to the conditions set forth below, the Company hereby grants you, effective as of the date set forth below, an award consisting of 41,281 restricted stock units (“Restricted Stock Units”), whereby each Restricted Stock Unit represents the right to receive one share of common stock, par value $0.01 per share, of the Company (“Stock”), plus the additional Cash Dividend Rights or Dividend Unit Rights, as applicable, set forth in Section 3, in accordance with the terms and conditions set forth herein and in the Plan (the “Award”). To the extent that any provision of this Agreement conflicts with the expressly applicable terms of the Plan, you acknowledge and agree that those terms of the Plan shall control and, if necessary, the applicable terms of this Agreement shall be deemed amended so as to carry out the purpose and intent of the Plan. Capitalized terms that are not otherwise defined in this Agreement shall have the meanings given to them in the Plan and/or in the Executive Grant and Separation Agreement dated May 12, 2014 (the “Separation Agreement”).

2. No Shareholder Rights. The Restricted Stock Units granted pursuant to this Agreement do not and shall not entitle you to any rights of a holder of Stock prior to the date shares of Stock are issued to you in settlement of the Award. Your rights with respect to the Restricted Stock Units shall remain unsecured and unfunded at all times prior to the date on which such shares of Stock are issued pursuant to the schedule set forth in Section 6.

3. Cash Dividend Rights; Dividend Unit Rights. In the event that the Company declares and pays a dividend in respect of its outstanding shares of Stock and, on the record date

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for such dividend, you hold Restricted Stock Units granted pursuant to this Agreement that have not been settled, the Company shall pay to you an amount in cash or additional restricted stock units equal to the cash or Stock dividends, as applicable, that you would have received if you were the holder of record, as of such record date, of the number of shares of Stock related to the portion of your Restricted Stock Units that have not been settled as of such record date, such payment to be made on or promptly following the date that the Company pays such dividend (however, in no event shall the Cash Dividend Rights or Dividend Unit Rights be paid later than thirty (30) days following the date on which the Company pays such dividend to its shareholders generally). To the extent any additional Restricted Stock Units are delivered pursuant to a Dividend Unit Right, such additional Restricted Stock Units shall be subject to the payment schedule set forth below in Section 6.

4. Restrictions. The Restricted Stock Units are restricted in that they may not be sold, transferred or otherwise alienated or hypothecated until these restrictions are removed or expire pursuant to the schedule set forth in Section 6 of this Agreement and Stock is issued to you as described in Section 5 of this Agreement.

5. Issuance of Stock. No shares of Stock shall be issued to you prior to the date on which the Restricted Stock Units are scheduled to be settled in accordance with Section 6. After reaching a scheduled date pursuant to Section 6, the Company shall, promptly and within fifteen (15) days of such date, cause to be issued Stock registered in your name in payment of such Restricted Stock Units upon receipt by the Company of any required tax withholding, as set forth in Section 7 hereof. The Company shall evidence the Stock to be issued in payment of the scheduled Restricted Stock Units in the manner it deems appropriate. The value of any fractional Restricted Stock Units shall be rounded down at the time Stock is issued to you in connection with the Restricted Stock Units. No fractional shares of Stock, nor the cash value of any fractional shares of Stock, will be issuable or payable to you pursuant to this Agreement. The value of such shares of Stock shall not bear any interest owing to the passage of time. Neither this Section 5 nor any action taken pursuant to or in accordance with this Section 5 shall be construed to create a trust or a funded or secured obligation of any kind.

6. Schedule of Settlement Payments.

(a) The restrictions on all of the Restricted Stock Units granted pursuant to this Agreement will expire and Stock will become issuable with respect to the Restricted Stock Units, as set forth in this Section 6 (which Stock will be transferable when issued, and nonforfeitable) on or subsequent to the applicable dates set forth in the following schedule:

(b) Notwithstanding the schedule set forth in (a) above,

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(i) if you die prior to the time at which you would otherwise become entitled to a payment of the Stock with respect to your Restricted Stock Units, then the schedule set forth above shall be accelerated and 100% of all previously unpaid shares of Stock attributable to your Restricted Stock Units shall become due and payable as of the date of your death, or

(ii) if a Change of Control occurs then the schedule set forth above shall be accelerated and 100% of all previously unpaid shares of Stock attributable to your Restricted Stock Units shall become due and payable as of the date upon which such Change of Control occurs.

(c) For purposes of this Agreement, “Change of Control” has the definition provided such term in the Plan with the following language added as the last sentence:

Notwithstanding the foregoing, with respect to an Award that is subject to Section 409A of the Code and with respect to which a Change of Control will accelerate payment, “Change of Control” shall mean an event that qualifies both as a “change of control” as defined in the Plan as well as a “change of control event” as defined in the regulations and guidance issued under Section 409A of the Code

7. Payment of Taxes. The Company may require you to pay to the Company (or a subsidiary of the Company’s if you are an employee of such entity), an amount the Company deems necessary to satisfy its (or its subsidiary’s) current or future obligation to withhold federal, state or local income or other taxes that you incur as a result of the Award. With respect to any required tax withholding, you may (a) direct the Company to withhold from the shares of Stock to be issued to you under this Agreement the number of shares necessary to satisfy the Company’s obligation to withhold taxes; which determination will be based on the shares’ Fair Market Value at the time such determination is made; (b) deliver to the Company shares of Stock sufficient to satisfy the Company’s tax withholding obligations, based on the shares’ Fair Market Value at the time such determination is made; or (c) deliver cash to the Company sufficient to satisfy its tax withholding obligations. If you desire to elect to use the stock withholding option described in subsection (a) of the foregoing sentence, you must make the election at the time and in the manner the Company prescribes.

8. Compliance with Securities Law. Notwithstanding any provision of this Agreement to the contrary, the issuance of Stock will be subject to compliance with all applicable requirements of federal, state, or foreign law with respect to such securities and with the requirements of any stock exchange or market system upon which the Stock may then be listed. No Stock will be issued hereunder if such issuance would constitute a violation of any applicable federal, state, or foreign securities laws or other law or regulations or the requirements of any stock exchange or market system upon which the Stock may then be listed. In addition, Stock will not be issued hereunder unless (a) a registration statement under the Securities Act is, at the time of issuance, in effect with respect to the shares issued or (b) in the opinion of legal counsel to the Company, the shares issued may be issued in accordance with the terms of an applicable exemption from the registration requirements of the Securities Act. YOU ARE CAUTIONED THAT ISSUANCE OF STOCK IN SETTLEMENT OF RESTRICTED STOCK UNITS GRANTED PURSUANT TO THIS AGREEMENT MAY NOT OCCUR UNLESS THE

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FOREGOING CONDITIONS ARE SATISFIED. The inability of the Company to obtain from any regulatory body having jurisdiction the authority, if any, deemed by the Company’s legal counsel to be necessary to the lawful issuance and sale of any shares subject to the Award will relieve the Company of any liability in respect of the failure to issue such shares as to which such requisite authority has not been obtained. As a condition to any issuance hereunder, the Company may require you to satisfy any qualifications that may be necessary or appropriate to evidence compliance with any applicable law or regulation and to make any representation or warranty with respect to such compliance as may be requested by the Company. From time to time, the Board and appropriate officers of the Company are authorized to take the actions necessary and appropriate to file required documents with governmental authorities, stock exchanges, and other appropriate persons to make shares of Stock available for issuance.

9. Clawback. Notwithstanding any provisions in this Agreement to the contrary, any compensation, payments, or benefits provided hereunder (or profits realized from the sale of the Stock delivered hereunder), whether in the form of cash or otherwise, shall be subject to a clawback to the extent necessary to comply with the requirements of any applicable law, including but not limited to, the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010, Section 304 of the Sarbanes Oxley Act of 2002, or any regulations promulgated thereunder.

10. Legends. The Company may at any time place legends referencing any restrictions imposed on the shares of Stock pursuant to this Agreement on all certificates representing shares of Stock issued with respect to this Award.

11. Furnish Information. You agree to furnish to the Company all information requested by the Company to enable it to comply with any reporting or other requirements imposed upon the Company by or under any applicable statute or regulation.

12. No Liability for Good Faith Determinations. The Company and the members of the Board shall not be liable for any act, omission or determination taken or made in good faith with respect to this Agreement or the Restricted Stock Units granted hereunder.

13. Execution of Receipts and Releases. Any payment of cash or any issuance or transfer of shares of Stock or other property to you, or to your legal representative, heir, legatee or distributee, in accordance with the provisions hereof, shall, to the extent thereof, be in full satisfaction of all claims of such persons hereunder. The Company may require you or your legal representative, heir, legatee or distributee, as a condition precedent to such payment or issuance, to execute a release and receipt therefor in such form as it shall determine.

14. No Guarantee of Interests. The Board and the Company do not guarantee the Stock of the Company from loss or depreciation.

15. Company Records. Records of the Company or any of its subsidiaries regarding your period of service, termination of service and the reason(s) therefor, and other matters shall be conclusive for all purposes hereunder, unless determined by the Company to be incorrect.

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16. Company Action. Any action required of the Company shall be by resolution of the Board or by a committee, person or entity authorized to act by resolution of the Board. The existence of the Restricted Stock Units shall not affect in any way the right or power of the Board or the stockholders of the Company to make or authorize any adjustment, recapitalization, reorganization, or other change in the Company’s capital structure or its business, any merger or consolidation of the Company, any issue of debt or equity securities, the dissolution or liquidation of the Company or any sale, lease, exchange, or other disposition of all or any part of its assets or business, or any other corporate act or proceeding.

17. Information Confidential. As partial consideration for the granting of the Award hereunder, you hereby agree to keep confidential all information and knowledge, except that which has been disclosed in any public filings required by law, that you have relating to the terms and conditions of this Agreement; provided, however, that such information may be disclosed as required by law and may be given in confidence to your spouse and tax and financial advisors.

18. Dispute Resolution. Paragraph 12 of the Separation Agreement is incorporated in its entirety by reference herein.

19. Notice. Any notice to be given to the Company hereunder shall be deemed sufficient if addressed to the Company in writing and delivered or mailed by certified or registered mail to its offices at One Ridgmar Centre, 6500 West Freeway, Suite 800, Fort Worth, Texas 76116, or such other address as the Company may hereafter designate. Any notice to be given to Employee hereunder shall be delivered or mailed by certified or registered mail to: 2425 Brookgreen Ct., Bedford, Texas 76021, or such other address as Employee may hereafter designate.

20. Waiver of Notice. Any person entitled to notice hereunder may waive such notice in writing.

21. Successors. This Agreement shall be binding upon you, your legal representatives, heirs, legatees and distributees, and upon the Company, its successors and assigns. In the event of any consolidation or merger of the Company into or with any other entity during the term of this Agreement, or the sale of all or substantially all of the assets of the Company to another person or entity during the term of this Agreement, such successor person or entity shall assume this Agreement and become obligated to perform all of the terms and provisions hereof applicable to the Company, and your obligations and restrictions hereunder shall continue in favor of such successor person or entity.

22. Severability. The invalidity or unenforceability of any provision of this Agreement shall not affect the validity or enforceability of any other provision of this Agreement. If any provision may be made enforceable by limitation, then such provision shall be deemed so limited and shall be enforceable to the maximum extent permitted by applicable law. This Agreement will be binding upon and inure to the benefit of the parties’ respective successors, assigns, legal representatives and heirs.

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23. Counterparts. This Agreement may be executed in one or more counterparts, each of which shall be deemed an original and all of which together shall be considered one and the same agreement. The delivery of this Agreement in the form of a clearly legible facsimile or electronically scanned version by e-mail shall have the same force and effect as delivery of the originally executed document.

24. Headings. The titles and headings of Sections are included for convenience of reference only and are not to be considered in construction of the provisions hereof.

25. Governing Law; Venue. This Agreement shall be governed by the laws of the State of Texas, without regard to its conflict-of-laws principles. You and the Company hereby irrevocably consent to the binding and exclusive venue for any Dispute between the parties arising out of or related to this Agreement being in the state or federal court of competent jurisdiction that regularly conducts proceedings in Tarrant County, Texas. Nothing in this Agreement, however, precludes you or the Company from seeking to remove a civil action from any state court to federal court. The obligation of the Company to sell and deliver Stock hereunder is subject to applicable laws and to the approval of any governmental authority required in connection with the authorization, issuance, sale, or delivery of such Stock.

26. Amendment. This Agreement cannot be modified except by a written agreement signed by both parties and specifically identified as an amendment to this Agreement. Notwithstanding the previous sentence, the Company may modify or amend this Agreement in its sole discretion at any time without your further consent in any manner necessary to comply with applicable law and regulations or the listing or other requirements of any stock exchange upon which the Company is listed; provided, that such amendment is immaterial and would not cause a material reduction of any benefits provided to you.

27. The Plan. This Agreement is subject to all the terms, conditions, limitations and restrictions contained in the Plan.

28. Right to Consult a Tax Advisor. Notwithstanding any contrary provision in this Agreement, you shall be solely responsible for any risk that the tax treatment of all or part of any payments provided by this Agreement may be affected by Section 409A, which may impose significant adverse tax consequences on you, including accelerated taxation, a 20% additional tax, and interest. Because of the potential tax consequences, you have the right, and are encouraged by this paragraph, to consult with a tax advisor of your choice before signing this Agreement.

[Remainder of page intentionally left blank]

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By your signature and the signature of the Company’s representative below, you and the Company hereby acknowledge receipt of the Restricted Stock Units issued on the date set forth below, which have been granted under the terms and conditions contained herein and in the Plan.

You acknowledge and agree that (a) you are not relying upon any written or oral statement or representation of the Company, its affiliates, or any of their respective employees, directors, officers, attorneys or agents (collectively, the “Company Parties”) regarding the tax effects associated with your execution of this Agreement and your receipt and holding of and the vesting of the Restricted Stock Units, and (b) in deciding to enter into this Agreement, you are relying on your own judgment and the judgment of the professionals of your choice with whom you have consulted. You hereby release, acquit and forever discharge the Company Parties from all actions, causes of actions, suits, debts, obligations, liabilities, claims, damages, losses, costs and expenses of any nature whatsoever, known or unknown, on account of, arising out of, or in any way related to the tax effects associated with your execution of the Agreement and your receipt and holding of and the settlement of the Restricted Stock Units.

You further acknowledge receipt of a copy of the Plan and agree to all of the terms and conditions of the Plan which are incorporated herein by reference.

Attachments: Approach Resources Inc. 2007 Stock Incentive Plan, as amended

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Exhibit 31.1

Certification

I, J. Ross Craft, certify that:

Exhibit 31.2

Certification

I, Sergei Krylov, certify that:

Exhibit 32.1

Certification of President and Chief Executive Officer of Approach Resources Inc.

(Pursuant to 18 U.S.C. Section 1350, as adopted pursuant to

Section 906 of the Sarbanes-Oxley Act of 2002)

In connection with the Quarterly Report of Approach Resources Inc. (the “Company”) on Form 10-Q for the period ended June 30, 2014, as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, J. Ross Craft, President and Chief Executive Officer of the Company, hereby certify, pursuant to 18 U.S.C. 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that to my knowledge:

Exhibit 32.2

Certification of Chief Financial Officer of Approach Resources Inc.

(Pursuant to 18 U.S.C. Section 1350, as adopted pursuant to

Section 906 of the Sarbanes-Oxley Act of 2002)

In connection with the Quarterly Report of Approach Resources Inc. (the “Company”) on Form 10-Q for the period ended June 30, 2014, as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Sergei Krylov, Chief Financial Officer of the Company, hereby certify, pursuant to 18 U.S.C. 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that to my knowledge: