Fair value measurements (Tables)

12 Months Ended

Dec. 31, 2018

Schedule of fair value hierarchy for assets and liabilities measured at fair value on a recurring basis

The following tables summarize the Company's derivatives' fair value hierarchy by commodity and current and noncurrent assets and liabilities on a gross basis and the net presentation included in the "Derivatives" line items on the consolidated balance sheets as of the dates presented:



(in thousands)	Level 1		Level 2			Level 3			Total gross fair value			Amounts offset			Net fair value presented on the consolidated balance sheets
As of December 31, 2018:
Assets
Current:
Oil derivatives	$	—	$	44,425		$	—		$	44,425		$	(7,907	)	$	36,518
NGL derivatives	—		1,974			—			1,974			—			1,974
Natural gas derivatives	—		18,991			—			18,991			(3,267		)	15,724
Oil derivative deferred premiums	—		—			—			—			(14,381		)	(14,381		)
Natural gas derivative deferred premiums	—		—			—			—			—			—
Noncurrent:
Oil derivatives	$	—	$	10,626		$	—		$	10,626		$	—		$	10,626
NGL derivatives	—		1,024			—			1,024			—			1,024
Natural gas derivatives	—		108			—			108			(728		)	(620		)
Oil derivative deferred premiums	—		—			—			—			—			—
Natural gas derivative deferred premiums	—		—			—			—			—			—
Liabilities
Current:
Oil derivatives	$	—	$	(9,059	)	$	—		$	(9,059	)	$	7,907		$	(1,152	)
NGL derivatives	—		—			—			—			—			—
Natural gas derivatives	—		(7,290		)	—			(7,290		)	3,267			(4,023		)
Oil derivative deferred premiums	—		—			(16,565		)	(16,565		)	14,381			(2,184		)
Natural gas derivative deferred premiums	—		—			—			—			—			—
Noncurrent:
Oil derivatives	$	—	$	—		$	—		$	—		$	—		$	—
NGL derivatives	—		—			—			—			—			—
Natural gas derivatives	—		(728		)	—			(728		)	728			—
Oil derivative deferred premiums	—		—			—			—			—			—
Natural gas derivative deferred premiums	—		—			—			—			—			—
Net derivative asset (liability) positions	$	—	$	60,071		$	(16,565	)	$	43,506		$	—		$	43,506



(in thousands)	Level 1		Level 2			Level 3			Total gross fair value			Amounts offset			Net fair value presented on the consolidated balance sheets
As of December 31, 2017:
Assets
Current:
Oil derivatives	$	—	$	7,427		$	—		$	7,427		$	(3,721	)	$	3,706
NGL derivatives	—		—			—			—			—			—
Natural gas derivatives	—		10,546			—			10,546			(4,817		)	5,729
Oil derivative deferred premiums	—		—			—			—			(87		)	(87		)
Natural gas derivative deferred premiums	—		—			—			—			(2,456		)	(2,456		)
Noncurrent:
Oil derivatives	$	—	$	11,613		$	—		$	11,613		$	(6,087	)	$	5,526
NGL derivatives	—		—			—			—			—			—
Natural gas derivatives	—		934			—			934			(934		)	—
Oil derivative deferred premiums	—		—			—			—			(2,113		)	(2,113		)
Natural gas derivative deferred premiums	—		—			—			—			—			—
Liabilities
Current:
Oil derivatives	$	—	$	(12,477	)	$	—		$	(12,477	)	$	3,721		$	(8,756	)
NGL derivatives	—		—			—			—			—			—
Natural gas derivatives	—		—			—			—			4,817			4,817
Oil derivative deferred premiums	—		—			(18,202		)	(18,202		)	87			(18,115		)
Natural gas derivative deferred premiums	—		—			(3,352		)	(3,352		)	2,456			(896		)
Noncurrent:
Oil derivatives	$	—	$	(2,389	)	$	—		$	(2,389	)	$	6,087		$	3,698
NGL derivatives	—		—			—			—			—			—
Natural gas derivatives	—		—			—			—			934			934
Oil derivative deferred premiums	—		—			(7,129		)	(7,129		)	2,113			(5,016		)
Natural gas derivative deferred premiums	—		—			—			—			—			—
Net derivative asset (liability) positions	$	—	$	15,654		$	(28,683	)	$	(13,029	)	$	—		$	(13,029	)

Actual cash payments required for deferred premium contracts

The following table presents payments required for derivative deferred premiums as of December 31, 2018 for the calendar years presented:



(in thousands)	December 31, 2018
2019	$	15,502
2020	1,295
Total	$	16,797

Summary of changes in assets classified as Level 3 measurements

A summary of the changes in net assets and liabilities classified as Level 3 measurements for the periods presented are as follows:



	For the years ended December 31,
(in thousands)	2018			2017			2016
Balance of Level 3 at beginning of year	$	(28,683	)	$	(8,998	)	$	(14,619	)
Change in net present value of derivative deferred premiums⁽¹⁾	(694		)	(394		)	(232		)
Purchases and settlements of derivative deferred premiums:
Purchases	(7,523		)	(25,733		)	(7,715		)
Settlements⁽²⁾	20,335			6,442			13,568
Balance of Level 3 at end of year	$	(16,565	)	$	(28,683	)	$	(8,998	)

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(1)	These amounts are included in the "Interest expense" line item in the consolidated statements of operations.

(2)

The amount for the year ended December 31, 2016 includes $3.9 million that represents the present value of deferred premiums settled in the Company's hedge restructuring upon their early termination.

Schedule of carrying amounts and fair value of debt

The following table presents the carrying amounts and fair values of the Company's debt as of the dates presented:



	December 31, 2018				December 31, 2017
(in thousands)	Long-term debt		Fair value⁽¹⁾		Long-term debt		Fair value⁽¹⁾
January 2022 Notes	$	450,000	$	402,885	$	450,000	$	454,500
March 2023 Notes	350,000		316,624		350,000		364,105
Senior Secured Credit Facility	190,000		190,054		—		—
Total	$	990,000	$	909,563	$	800,000	$	818,605

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(1)

The fair values of the debt outstanding on the January 2022 Notes and the March 2023 Notes were determined using the as of December 31, 2018 and 2017 Level 1 fair value hierarchy quoted market price for each respective instrument. The fair value of the outstanding debt on the Senior Secured Credit Facility as of December 31, 2018 was estimated utilizing the Level 2 fair value hierarchy pricing model for similar instruments. See Note 10.a for information about the fair value hierarchy levels.