XML 47 R32.htm IDEA: XBRL DOCUMENT v2.4.0.8
Derivative Activities(Tables)
 9 Months Ended
Sep. 30, 2013
Derivative Volumes Hedged and Average Hedge Prices

The following table sets forth our derivative volumes by year as of September 30, 2013:

Period

 

Contract Type

 

Volume Hedged

 

Weighted
Average Hedge Price

Natural Gas

 

 

 

 

 

 

2013

 

Collars

 

280,000 Mmbtu/day

 

$ 4.59–$ 5.05

2014

 

Collars

 

447,500 Mmbtu/day

 

$ 3.84–$ 4.48

2015

 

Collars

 

145,000 Mmbtu/day

 

$ 4.07–$ 4.56

2013

 

Swaps

 

293,370 Mmbtu/day

 

$

  3.82

2014

 

Swaps

 

30,000 Mmbtu/day

 

$

  4.17

2015

 

Swaps

 

7,500 Mmbtu/day

 

$

  4.16

 

 

 

 

 

 

 

Crude Oil

 

 

 

 

 

 

2013

 

Collars

 

3,000 bbls/day

 

$ 90.60–$ 100.00

2014

 

Collars

 

2,000 bbls/day

 

$ 85.55–$ 100.00

2013

 

Swaps

 

6,825 bbls/day

 

$

  96.79

2014

 

Swaps

 

7,000 bbls/day

 

$

  94.14

2015

 

Swaps

 

2,000 bbls day

 

$

  90.20

 

 

 

 

 

 

 

NGLs (Natural Gasoline)

 

 

 

 

 

 

2013

 

Sold Swaps

 

8,000 bbls/day

 

$

  89.64

2013

 

Re-purchased Swaps

 

1,500 bbls/day

 

$

  76.30

 

 

 

 

 

 

 

NGLs (Propane)

 

 

 

 

 

 

2013

 

Swaps

 

11,000 bbls/day

 

$

  37.87

2014

 

Swaps

 

7,000 bbls/day

 

$

  40.38

 

 

 

 

 

 

 

NGLs (Normal butane)

 

 

 

 

 

 

2013

 

Swaps

 

2,000 bbls/day

 

$

  55.44

2014

 

Swaps

 

2,000 bbls/day

 

$

  54.60

 
Derivative Fair Value Income

The following table presents information about the components of derivative fair value (loss) income for the three months and the nine months ended September 30, 2013 and 2012 (in thousands):

 

 

Three Months Ended
September 30,

 

 

Nine Months Ended
September 30,

 

 

2013

 

 

2012

 

 

2013

 

 

2012

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Change in fair value of derivatives that did not qualify or were not designated for hedge accounting (a)

$

(34,219

)

 

$

(53,646

)

 

$

  28,350

 

 

$

  30,075

 

Realized gain (loss) on settlement–natural gas (a) (b)

 

  5,815

 

 

 

—

 

 

 

(17,913

) 

 

 

—

 

Realized (loss) gain on settlement–oil (a) (b)

 

(8,005

)

 

 

  1,955

 

 

 

(8,218

)

 

 

(1,899

)

Realized (loss) gain on settlement–NGLs (a) (b)

 

(3,907

)

 

 

  14,682

 

 

 

(1,759

)

 

 

  20,442

 

Hedge ineffectiveness

 

–realized

 

(854

) 

 

 

  988

 

 

 

(445

)

 

 

  3,451

 

 

 

–unrealized

 

  815

 

 

 

(4,707

)

 

 

(2,485

)

 

 

(5,061

)

Derivative fair value (loss) income

$

(40,355

)

 

$

(40,728

)

 

$

(2,470

)

 

$

  47,008

 

(a) Derivatives that did not qualify or were not designated for hedge accounting. Change in fair value of derivatives line also includes gains of $3.1 million in third quarter 2013 and gains of $25.5 million in the first nine months 2013 related to discontinuance of hedge accounting.

(b) These amounts represent the realized gains and losses on settled derivatives that did not qualify or were not designated for hedge accounting, which before settlement are included in the category in this same table referred to as change in fair value of derivatives that did not qualify or were not designated for hedge accounting.

Schedule of Derivative Off setting Assets and Liabilities Table Text Block

The tables below provide additional information relating to our master netting arrangements with our derivative counterparties (in thousands):

 

 

 

 

September 30, 2013

 

 

 

 

Gross Amounts of
Recognized Assets

 

 

Gross Amounts
Offset in the
Balance Sheet

 

 

Net Amounts of
Assets Presented in the
Balance Sheet

 

 

 

 

 

 

 

 

 

 

Derivative assets:

 

 

 

 

 

 

 

 

Natural gas

 

–swaps

$

  10,965

  

  

$

(2,046

)

  

$

  8,919

 

 

 

–collars

 

  71,699

 

 

 

(1,720

)

 

 

  69,979

 

Crude oil

 

–swaps

 

  2,962

 

 

 

(7,766

)

 

 

(4,804

)

 

 

–collars

 

  137

 

 

 

(1,803

)

 

 

(1,666

)

NGLs

 

–C5 swaps

 

  3,374

 

 

 

(1,461

)

 

 

  1,913

 

 

 

–C3 swaps

 

  7

 

 

 

(552

)

 

 

(545

)

 

 

–C4 swaps

 

  406

 

 

 

(135

)

 

 

  271

 

 

 

 

$

  89,550

 

 

$

(15,483

)

 

$

  74,067

 

 

 

 

 

 

September 30, 2013

 

 

 

 

Gross Amounts of
Recognized (Liabilities)

 

 

Gross Amounts
Offset in the
Balance Sheet

 

 

Net Amounts of
(Liabilities) Presented in the
Balance Sheet

 

 

 

 

 

 

 

 

 

 

Derivative (liabilities):

 

 

 

 

 

 

 

 

Natural gas

 

–swaps

$

(1,219

)

 

$

  2,046

 

 

$

  827

 

 

 

–collars

 

(1,720

)

 

 

  1,720

 

 

 

—

 

Crude oil

 

–swaps

 

(7,766

)

 

 

  7,766

 

 

 

—

 

 

 

–collars

 

(1,803

)

 

 

  1,803

 

 

 

—

 

NGLs

 

–C5 swaps

 

(9

)

 

 

  1,461

 

 

 

  1,452

 

 

 

–C3 swaps

 

(10,469

)

 

 

  552

 

 

 

(9,917

)

 

 

–C4 swaps

 

(571

)

 

 

  135

 

 

 

(436

)

 

 

 

$

(23,557

)

 

$

  15,483

 

 

$

(8,074

)

 

 

 

 

 

 

December 31, 2012

 

 

 

 

Gross Amounts of
Recognized Assets

 

 

Gross Amounts
Offset in the
Balance Sheet

 

 

Net Amounts of
Assets Presented in the
Balance Sheet

 

 

 

 

 

 

 

 

 

 

Derivative assets:

 

 

 

 

 

 

 

 

Natural gas

 

–swaps

$

  10,746

  

 

$

(3,242

)

 

$

  7,504

  

 

 

–collars

 

  128,410

 

 

 

(6,155

)

 

 

  122,255

 

 

 

–basis swaps

 

  993

 

 

 

—

 

 

 

  993

 

Crude oil

 

–swaps

 

  9,650

 

 

 

—

 

 

 

  9,650

 

 

 

–collars

 

  2,222

 

 

 

—

 

 

 

  2,222

 

NGLs

 

–C5  swaps

 

  13,055

 

 

 

(2,412

)

 

 

  10,643

 

 

 

 

$

  165,076

 

 

$

(11,809

)

 

$

  153,267

 

 

 

 

 

December 31, 2012

 

 

 

 

Gross Amounts of
Recognized (Liabilities)

 

Gross Amounts
Offset in the
Balance Sheet

 

 

Net Amounts of
(Liabilities) Presented in the
Balance Sheet

 

 

 

 

 

 

 

 

 

 

 

 

 

Derivative (liabilities):

 

 

 

 

 

 

 

 

 

 

 

Natural gas

 

–swaps

$

(3,242

)

 

$

(221

)

 

$

(3,463

)

 

 

–collars

 

(9,618

)

 

 

  9,618

 

 

 

—

 

NGLs

 

–C5 swaps

 

(137

)

 

 

  2,412

 

 

 

  2,275

 

 

 

–C3 swaps

 

(6,746

)

 

 

—

 

 

 

(6,746

)

 

 

 

$

(19,743

)

 

$

  11,809

 

 

$

(7,934

)

 
Fair Value of Derivative Contracts by Consolidated Balance Sheets

The table below provides data about the fair value of our derivative contracts. Derivative assets and liabilities shown below are presented as gross assets and liabilities, without regard to master netting arrangements, which are considered in the presentation of derivative assets and liabilities in the accompanying consolidated balance sheets (in thousands):

 

 

September 30, 2013

 

 

 

 

December 31, 2012

 

 

Assets

  

  

  

(Liabilities)

 

 

 

 

 

 

Assets

  

  

  

(Liabilities)

 

 

 

 

 

 

Carrying
Value

 

 

Carrying
Value

 

 

Net
Carrying
Value

 

 

Carrying
Value

 

 

Carrying
Value

 

 

Net
Carrying
Value

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Derivatives that qualified for cash flow hedge accounting (before discontinuance of hedge accounting):

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Swaps (a)

$

  7,091

 

  

$

(3,960

)

 

$

  3,131

 

 

$

  22,236

 

  

$

(3,242

)

 

$

  18,994

 

Collars (a)

 

  38,685

 

  

 

(10,356

)

 

 

  28,329

 

 

 

  129,878

 

  

 

(9,721

)

 

 

  120,157

 

 

$

  45,776

 

  

$

(14,316

)

 

$

  31,460

 

 

$

  152,114

 

  

$

(12,963

)

 

$

  139,151

 

Derivatives that did not qualify or were not designated for hedge accounting:

 

 

 

  

 

 

 

 

 

 

 

 

 

 

 

  

 

 

 

 

 

 

 

Sold swaps (a)

$

  16,159

 

  

$

(23,072

)

 

$

(6,913

)

 

$

  7,316

 

  

$

(8,904

)

 

$

(1,588

)

Re-purchased swaps (a)

 

  1,462

 

  

 

—

 

 

 

  1,462

 

 

 

  5,920

 

  

 

—

 

 

 

  5,920

 

Collars (a)

 

  42,943

 

  

 

(2,959

)

 

 

  39,984

 

 

 

  857

 

  

 

—

 

 

 

  857

 

Basis swaps (a)

 

—

 

  

 

—

 

 

 

—

 

 

 

  993

 

  

 

—

 

 

 

  993

 

 

$

  60,564

 

  

$

(26,031

)

 

$

  34,533

 

 

$

  15,086

 

  

$

(8,904

)

 

$

  6,182

  

(a) Included in unrealized derivatives in the accompanying consolidated balance sheets. See additional discussion above regarding the discontinuance of hedge accounting.

Effects of Cash Flow Hedges and Other Hedges on Accumulated Other Comprehensive Income

The effects of our cash flow hedges (or those derivatives that previously qualified for hedge accounting) on accumulated other comprehensive income in the accompanying consolidated balance sheets is summarized below (in thousands):

 

 

 

Three Months Ended September 30,

 

 

Nine Months Ended September 30,

 

 

Change in Hedge
Derivative Fair Value

 

 

Realized Gain (Loss)
Reclassified from OCI
into Revenue (a)

 

 

Change in Hedge
Derivative Fair Value

 

 

Realized Gain (Loss)
Reclassified from OCI
into Revenue (a)

 

 

2013

 

 

2012

 

 

2013

 

 

2012

 

 

2013

 

 

2012

 

 

2013

 

 

2012

 

 

 

 

 

  

 

 

 

 

 

 

 

 

 

 

 

  

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Swaps

$

—

 

  

$

(33,311

)

 

$

  2,765

 

 

$

  18,204

 

  

$

  125

 

 

$

  22,525

 

 

$

  14,687

 

 

$

  69,851

 

Put options

 

—

 

  

 

(994

)

 

 

—

 

 

 

(682

)

  

 

—

 

 

 

(1,908

)

 

 

—

 

 

 

(998

)

Collars

 

—

 

  

 

(51,344

)

 

 

  25,357

 

 

 

  43,945

 

 

 

(7,015

)

 

 

  32,704

 

 

 

  83,630

 

 

 

  128,823

 

Income taxes

 

—

 

  

 

  33,403

 

 

 

(10,967

)

 

 

(23,972

)

  

 

  2,687

 

 

 

(21,780

)

 

 

(38,343

)

 

 

(76,805

)

 

$

—

 

  

$

(52,246

)

 

$

  17,155

 

 

$

  37,495

 

 

$

(4,203

)

 

$

  31,541

 

 

$

  59,974

 

 

$

  120,871

 

(a) For realized gains upon derivative contract settlement, the reduction in AOCI is offset by an increase in revenues, NGLs and oil sales. For realized losses upon derivative contract settlement, the increase in AOCI is offset by a decrease in revenues. See additional discussion above regarding the discontinuance of hedge accounting.

 

 
Effects of Non-Hedge Derivatives on Consolidated Statements of Operations

The effects of our non-hedge derivatives (or those derivatives that do not qualify for hedge accounting) and the ineffective portion of our hedge derivatives on our consolidated statements of operations is summarized below (in thousands):

 

 

 

Three Months Ended September 30,

 

 

Gain (Loss) Recognized in
Income (Non‑hedge Derivatives)

 

 

Gain (Loss) Recognized in
Income (Ineffective Portion)

 

 

Derivative Fair Value
Income (Loss)

 

 

2013

 

 

2012

 

 

2013

 

 

2012

 

 

2013

 

 

2012

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Swaps

$

(48,277

) 

 

$

(45,998

)

 

$

(39

)

 

$

(1,556

)

 

$

(48,316

)

 

$

(47,554

)

Re-purchased swaps

 

  1,595

 

 

 

  12,822

 

 

 

—

 

 

 

—

 

 

 

  1,595

 

 

 

  12,822

 

Collars

 

  6,366

 

 

 

(1,714

)

 

 

—

 

 

 

(2,163

)

 

 

  6,366

 

 

 

(3,877

)

Call options

 

—

 

 

 

(2,119

)

 

 

—

 

 

 

—

 

 

 

—

 

 

 

(2,119

)

Total

$

(40,316

)

 

$

(37,009

)

 

$

(39

)

 

$

(3,719

)

 

$

(40,355

)

 

$

(40,728

)

 

 

Nine Months Ended September 30,

 

 

Gain (Loss) Recognized in
Income (Non‑hedge Derivatives)

 

 

Gain (Loss) Recognized in
Income (Ineffective Portion)

 

 

Derivative Fair Value
Income (Loss)

 

 

2013

 

 

2012

 

 

2013

 

 

2012

 

 

2013

 

 

2012

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Swaps

$

(26,350

)

 

$

  30,330

 

 

$

(2,034

)

 

$

(890

)

 

$

(28,384

)

 

$

  29,440

 

Re-purchased swaps

 

  1,117

 

 

 

  4,078

 

 

 

—

 

 

 

—

 

 

 

  1,117

 

 

 

  4,078

 

Collars

 

  25,783

 

 

 

  3,381

 

 

 

(896

)

 

 

(720

) 

 

 

  24,887

 

 

 

  2,661

 

Call options

 

—

 

 

 

  10,829

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

  10,829

 

Basis swaps

 

(90

)

 

 

—

 

 

 

 

 

 

 

—

 

 

 

(90

)

 

 

—

 

Total

$

  460

 

 

$

  48,618

 

 

$

(2,930

)

 

$

(1,610

)

 

$

(2,470

)

 

$

  47,008