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Derivative Instruments (Tables)
 6 Months Ended
Jun. 30, 2014
Derivative Instruments  
Derivatives designated and not designated as hedging instruments

 

 

 

 

Three Months Ended

 

Six Months Ended

 

 

 

June 30,

 

June 30,

 

 

 

2014

 

2013

 

2014

 

2013

 

 

 

(Thousands)

Commodity derivatives designated as cash flow hedges

 

 

 

 

 

 

 

 

 

Amount of (loss) gain recognized in OCI (effective portion), net of tax

 

$

(13,455)

 

$

73,429

 

$

(52,649)

 

$

20,828

 

Amount of gain reclassified from accumulated OCI, net of tax, into gain on sale / exchange of assets due to forecasted transactions probable to not occur

 

16,735

 

–

 

16,735

 

–

 

Amount of (loss) gain reclassified from accumulated OCI into operating revenues (effective portion), net of tax

 

(10,883)

 

10,490

 

(28,146)

 

36,323

 

Amount of gain (loss) recognized in operating revenues (ineffective portion) (a)

 

987

 

(7,473)

 

(21,273)

 

(7,954)

 

 

 

 

 

 

 

 

 

 

 

Interest rate derivatives designated as cash flow hedges

 

 

 

 

 

 

 

 

 

Amount of loss reclassified from accumulated OCI, net of tax, into interest expense (effective portion)

 

$

36

 

$

36

 

$

72

 

$

72

 

 

 

 

 

 

 

 

 

 

 

Commodity derivatives designated as fair value hedges (b)

 

 

 

 

 

 

 

 

 

 

Amount of gain (loss) recognized in operating revenues for fair value commodity contracts

 

$

–

 

$

2,700

 

$

–

 

$

(839)

 

Fair value (loss) gain recognized in operating revenues for inventory designated as hedged item

 

–

 

(4,075)

 

 

–

 

462

 

 

 

 

 

 

 

 

 

 

 

Derivatives not designated as hedging instruments

 

 

 

 

 

 

 

 

 

Amount of (loss) gain recognized in operating revenues

 

$

(8,525)

 

$

1,512

 

$

(17,879)

 

$

1,250

 

 

(a)     No amounts have been excluded from effectiveness testing of cash flow hedges.

 

(b)     For the three months ended June 30, 2013, the net impact on operating revenues consisted of a $0.8 million gain due to the exclusion of the spot/forward differential from the assessment of effectiveness of the fair value hedges and a $2.2 million loss due to changes in basis. For the six months ended June 30, 2013, the net impact on operating revenues consisted of a $2.1 million gain due to the exclusion of the spot/forward differential from the assessment of effectiveness of the fair value hedges and a $2.5 million loss due to changes in basis.
Asset and liability derivatives

 

 

 

As of
June 30,

 

As of
December 31,

 

 

 

2014

 

2013

 

 

 

(Thousands)  

 

Asset derivatives

 

 

 

 

 

Commodity derivatives designated as hedging instruments

 

$

33,942

 

$

104,430

 

Commodity derivatives not designated as hedging instruments

 

32,466

 

3,217

 

Total asset derivatives

 

$

66,408

 

$

107,647

 

 

 

 

 

 

 

Liability derivatives

 

 

 

 

 

Commodity derivatives designated as hedging instruments

 

$

47,713

 

$

27,618

 

Commodity derivatives not designated as hedging instruments

 

10,403

 

2,033

 

Total liability derivatives

 

$

58,116

 

$

29,651

 

 
Schedule of impact of netting agreements and margin deposits on gross derivative assets and liabilities

 

 

As of June 30, 2014

 

Derivative
instruments,
recorded in the
Condensed
Consolidated
Balance
Sheet, gross

 

Derivative
instruments
subject to
master
netting
agreements

 

Margin
deposits
remitted to
counterparties

 

Derivative
instruments,
net

 

 

 

(Thousands)

Asset derivatives:

 

 

 

 

 

 

 

 

 

Derivative instruments, at fair value

 

$

66,408

 

$

(26,331)

 

$

–

 

$

40,077

 

 

 

 

 

 

 

 

 

 

 

Liability derivatives:

 

 

 

 

 

 

 

 

 

Derivative instruments, at fair value

 

$

58,116

 

$

(26,331)

 

$

(103)

 

$

31,682

 

 

As of December 31, 2013

 

Derivative
instruments,
recorded in the
Condensed
Consolidated
Balance
Sheet, gross

 

Derivative
instruments
subject to 
master
netting
agreements

 

Margin
deposits
remitted to
counterparties

 

Derivative
instruments,
net

 

 

 

(Thousands)

 

Asset derivatives:

 

 

 

 

 

 

 

 

 

Derivative instruments, at fair value

 

$

107,647

 

$

(20,843)

 

$

–

 

$

86,804

 

 

 

 

 

 

 

 

 

 

 

Liability derivatives:

 

 

 

 

 

 

 

 

 

Derivative instruments, at fair value

 

$

29,651

 

$

(20,843)

 

$

(266)

 

$

8,542