Income Taxes

6 Months Ended

Jun. 30, 2011

Income Taxes

Income Taxes

NOTE E. Income Taxes

The Company accounts for income taxes in accordance with the provisions of ASC Topic 740, which requires that the Company continually assess both positive and negative evidence to determine whether it is more likely than not that deferred tax assets can be realized prior to their expiration. Pioneer monitors Company-specific, oil and gas industry and worldwide economic factors to assess the likelihood that the Company's net operating loss carry forwards ("NOLs") and other deferred tax attributes in the U.S., state, local and foreign tax jurisdictions will be utilized prior to their expiration. As of June 30, 2011 and December 31, 2010, the Company's valuation allowances were $9.9 million and $6.6 million, respectively. As of December 31, 2010, the Company also had a $26.5 million valuation allowance related to Tunisia operations, which was classified as discontinued operations held for sale. 

ASC 740 also clarifies the accounting for uncertainty in income taxes recognized and prescribes a recognition threshold and measurement methodology for the financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. As of June 30, 2011, the Company had no significant unrecognized tax benefits. The Company's policy is to account for interest charges with respect to income taxes as interest expense and any penalties, with respect to income taxes, as other expense in the consolidated statements of operations. The Company files income tax returns in the U.S. federal and various state and foreign jurisdictions. With few exceptions, the Company believes that it is no longer subject to examinations by tax authorities for years before 2005. As of June 30, 2011, no adjustments had been proposed in any jurisdiction that would have a significant effect on the Company's liquidity, future results of operations or financial position.

Income tax (provisions) benefits. The Company's income tax (provisions) benefits attributable to income from continuing operations consisted of the following for the three and six months ended June 30, 2011 and 2010:

	Three Months Ended June 30,						Six Months Ended June 30,
	2011			2010			2011			2010
	(in thousands)
Current:
U.S. federal	$	—		$	(2,199	)	$	—		$	(3,301	)
U.S. state		(2,538	)		(1,800	)		(4,936	)		(3,124	)
Foreign		(10,782	)		(413	)		(17,102	)		(450	)
		(13,320	)		(4,412	)		(22,038	)		(6,875	)
Deferred:
U.S. federal		(140,948	)		(71,929	)		(100,160	)		(203,056	)
U.S. state		304			(7,040	)		10,729			(16,500	)
Foreign		9,268			161			13,924			(796	)
		(131,376	)		(78,808	)		(75,507	)		(220,352	)
Income tax provision	$	(144,696	)	$	(83,220	)	$	(97,545	)	$	(227,227	)

Discontinued operations. The Company's income tax (provisions) benefits attributable to income from discontinued operations consisted of the following for the three and six months ended June 30, 2011 and 2010:

	Three Months Ended June 30,						Six Months Ended June 30,
	2011			2010			2011			2010
	(in thousands)
Current:
U.S. state	$	1,790		$	—		$	(3,935	)	$	—
Foreign		(3,753	)		(5,737	)		(5,602	)		(5,294	)
		(1,963	)		(5,737	)		(9,537	)		(5,294	)
Deferred:
U.S. federal		4,832			(12,909	)		(222,490	)		(12,839	)
U.S. state		80			—			(2,068	)		—
Foreign		4,669			(5,979	)		(7,653	)		(22,960	)
		9,581			(18,888	)		(232,211	)		(35,799	)
Income tax (provision) benefit	$	7,618		$	(24,625	)	$	(241,748	)	$	(41,093	)