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Derivative Instruments and Hedging Activities (Tables)
9 Months Ended
Sep. 30, 2019
Derivative Instruments And Hedging Activities Disclosure [Abstract]  
Notional Volume of Commodity Hedges

At September 30, 2019, the notional volumes of our commodity derivative contracts were:

 

Commodity

Instrument

Unit

2019

 

2020

 

2021

 

2022

 

2023

 

2024

 

Natural Gas

Swaps

MMBtu/d

 

172,254

 

 

96,130

 

 

85,151

 

 

7,500

 

 

-

 

 

-

 

Natural Gas

Basis Swaps

MMBtu/d

 

398,098

 

 

352,260

 

 

339,360

 

 

200,000

 

 

200,000

 

 

40,000

 

NGL

Swaps

Bbl/d

 

30,468

 

 

20,305

 

 

8,396

 

 

3,236

 

 

-

 

 

-

 

NGL

Futures

Bbl/d

 

29,620

 

 

15,495

 

 

-

 

 

-

 

 

-

 

 

-

 

NGL

Options

Bbl/d

 

410

 

 

-

 

 

-

 

 

-

 

 

-

 

 

-

 

Condensate

Swaps

Bbl/d

 

4,170

 

 

4,140

 

 

3,154

 

 

1,110

 

 

-

 

 

-

 

Condensate

Options

Bbl/d

 

590

 

 

-

 

 

-

 

 

-

 

 

-

 

 

-

 

Fair Value of Derivative Instruments The following schedules reflect the fair value of our derivative instruments and their location on our Consolidated Balance Sheets as well as pro forma reporting assuming that we reported derivatives subject to master netting agreements on a net basis:

 

 

 

 

 

Fair Value as of September 30, 2019

 

 

Fair Value as of December 31, 2018

 

 

 

Balance Sheet

 

Derivative

 

 

Derivative

 

 

Derivative

 

 

Derivative

 

 

 

Location

 

Assets

 

 

Liabilities

 

 

Assets

 

 

Liabilities

 

Derivatives designated as hedging instruments

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Commodity contracts

 

Current

 

$

138.2

 

 

$

(11.4

)

 

$

112.5

 

 

$

(18.9

)

 

 

Long-term

 

 

56.6

 

 

 

(1.1

)

 

 

31.6

 

 

 

(1.5

)

Total derivatives designated as hedging instruments

 

 

 

$

194.8

 

 

$

(12.5

)

 

$

144.1

 

 

$

(20.4

)

Derivatives not designated as hedging instruments

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Commodity contracts

 

Current

 

$

1.9

 

 

$

(72.1

)

 

$

2.8

 

 

$

(14.7

)

 

 

Long-term

 

 

3.4

 

 

 

(45.0

)

 

 

2.5

 

 

 

(1.6

)

Total derivatives not designated as hedging instruments

 

 

 

$

5.3

 

 

$

(117.1

)

 

$

5.3

 

 

$

(16.3

)

Total current position

 

 

 

$

140.1

 

 

$

(83.5

)

 

$

115.3

 

 

$

(33.6

)

Total long-term position

 

 

 

 

60.0

 

 

 

(46.1

)

 

 

34.1

 

 

 

(3.1

)

Total derivatives

 

 

 

$

200.1

 

 

$

(129.6

)

 

$

149.4

 

 

$

(36.7

)

 

Pro Forma Impact of Derivatives Net in Consolidated Balance Sheet

The pro forma impact of reporting derivatives on our Consolidated Balance Sheets on a net basis is as follows:

 

 

 

Gross Presentation

 

 

Pro Forma Net Presentation

 

September 30, 2019

Asset

 

 

Liability

 

 

Collateral

 

 

Asset

 

 

Liability

 

Current Position

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Counterparties with offsetting positions or collateral

$

103.9

 

 

$

(69.5

)

 

$

(25.2

)

 

$

62.5

 

 

$

(53.3

)

 

Counterparties without offsetting positions - assets

 

36.2

 

 

 

-

 

 

 

-

 

 

 

36.2

 

 

 

-

 

 

Counterparties without offsetting positions - liabilities

 

-

 

 

 

(14.0

)

 

 

-

 

 

 

-

 

 

 

(14.0

)

 

 

 

140.1

 

 

 

(83.5

)

 

 

(25.2

)

 

 

98.7

 

 

 

(67.3

)

Long Term Position

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Counterparties with offsetting positions or collateral

 

47.1

 

 

 

(46.1

)

 

 

-

 

 

 

32.1

 

 

 

(31.1

)

 

Counterparties without offsetting positions - assets

 

12.9

 

 

 

-

 

 

 

-

 

 

 

12.9

 

 

 

-

 

 

Counterparties without offsetting positions - liabilities

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

 

60.0

 

 

 

(46.1

)

 

 

-

 

 

 

45.0

 

 

 

(31.1

)

Total Derivatives

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Counterparties with offsetting positions or collateral

 

151.0

 

 

 

(115.6

)

 

 

(25.2

)

 

 

94.6

 

 

 

(84.4

)

 

Counterparties without offsetting positions - assets

 

49.1

 

 

 

-

 

 

 

-

 

 

 

49.1

 

 

 

-

 

 

Counterparties without offsetting positions - liabilities

 

-

 

 

 

(14.0

)

 

 

-

 

 

 

-

 

 

 

(14.0

)

 

 

$

200.1

 

 

$

(129.6

)

 

$

(25.2

)

 

$

143.7

 

 

$

(98.4

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Gross Presentation

 

 

Pro Forma Net Presentation

 

December 31, 2018

Asset

 

 

Liability

 

 

Collateral

 

 

Asset

 

 

Liability

 

Current Position

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Counterparties with offsetting positions or collateral

$

100.0

 

 

$

(33.6

)

 

$

(14.2

)

 

$

70.0

 

 

$

(17.8

)

 

Counterparties without offsetting positions - assets

 

15.3

 

 

 

-

 

 

 

-

 

 

 

15.3

 

 

 

-

 

 

Counterparties without offsetting positions - liabilities

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

 

115.3

 

 

 

(33.6

)

 

 

(14.2

)

 

 

85.3

 

 

 

(17.8

)

Long Term Position

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Counterparties with offsetting positions or collateral

 

8.9

 

 

 

(3.1

)

 

 

-

 

 

 

5.9

 

 

 

(0.1

)

 

Counterparties without offsetting positions - assets

 

25.2

 

 

 

-

 

 

 

-

 

 

 

25.2

 

 

 

-

 

 

Counterparties without offsetting positions - liabilities

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

 

34.1

 

 

 

(3.1

)

 

 

-

 

 

 

31.1

 

 

 

(0.1

)

Total Derivatives

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Counterparties with offsetting positions or collateral

 

108.9

 

 

 

(36.7

)

 

 

(14.2

)

 

 

75.9

 

 

 

(17.9

)

 

Counterparties without offsetting positions - assets

 

40.5

 

 

 

-

 

 

 

-

 

 

 

40.5

 

 

 

-

 

 

Counterparties without offsetting positions - liabilities

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

$

149.4

 

 

$

(36.7

)

 

$

(14.2

)

 

$

116.4

 

 

$

(17.9

)

 

 

Amounts Recorded in Other Comprehensive Income OCI and Amounts Reclassified from OCI to Revenue

The following tables reflect amounts recorded in Other comprehensive income (“OCI”) and amounts reclassified from OCI to revenue for the periods indicated:

 

 

 

Gain (Loss) Recognized in OCI on

Derivatives (Effective Portion)

 

Derivatives in Cash Flow

 

Three Months Ended September 30,

 

 

Nine Months Ended September 30,

 

Hedging Relationships

 

2019

 

 

2018

 

 

2019

 

 

2018

 

Commodity contracts

 

$

118.2

 

 

$

(139.6

)

 

$

167.8

 

 

$

(178.0

)

 

 

 

Gain (Loss) Reclassified from OCI into

Income (Effective Portion)

 

 

 

Three Months Ended September 30,

 

 

Nine Months Ended September 30,

 

Location of Gain (Loss)

 

2019

 

 

2018

 

 

2019

 

 

2018

 

Revenues

 

$

41.5

 

 

$

(23.9

)

 

$

106.1

 

 

$

(58.3

)

Gain (Loss) Recognized in Income on Derivatives For the three and nine months ended September 30, 2019, the unrealized mark-to-market losses are primarily attributable to unfavorable movements in natural gas forward basis prices.

 

 

 

Location of Gain

 

Gain (Loss) Recognized in Income on Derivatives

 

Derivatives Not Designated

 

Recognized in Income on

 

Three Months Ended September 30,

 

 

Nine Months Ended September 30,

 

as Hedging Instruments

 

Derivatives

 

2019

 

 

2018

 

 

2019

 

 

2018

 

Commodity contracts

 

Revenue

 

$

(103.3

)

 

$

(1.1

)

 

$

(113.8

)

 

$

(14.1

)