DERIVATIVE INSTRUMENTS (Tables)

6 Months Ended

Jun. 30, 2011

DERIVATIVE INSTRUMENTS

Schedule of outstanding commodity swaps and costless collars

The table below sets forth Forest’s outstanding commodity swaps and costless collars as of June 30, 2011.

Commodity Swaps and Collars

	Natural Gas (NYMEX HH)			Oil (NYMEX WTI)				NGLs (OPIS Refined Products)
Remaining Term	Bbtu Per Day	Weighted Average Hedged Price per MMBtu		Barrels Per Day	Weighted Average Hedged Price per Bbl			Barrels Per Day	Weighted Average Hedged Price per Bbl
Swaps:
July 2011 - December 2011(1)	180	$	5.38	1,000	$	85.00		5,000	$	38.15
Calendar 2012(2)	130	5.26		500	104.25			2,000	45.22
Collars:
July 2011 - December 2011	—	—		3,000	75.00/90.20		(3)	—	—

(1) Includes derivative agreements entered into by LPR Canada for 30 Bbtu per day of gas swaps at a weighted average hedged price per MMBtu of $4.85.

(2) Includes derivative agreements entered into by LPR Canada for (i) 25 Bbtu per day of gas swaps at a weighted average hedged price per MMBtu of $5.09 and (ii) 500 barrels per day of oil swaps at a hedged price per barrel of $104.25.

(3) Represents the weighted average hedged floor and ceiling price per Bbl.

Schedule of outstanding commodity options

The table below sets forth the outstanding options as of June 30, 2011 (as of August 2, 2011, none of the options in the table have been exercised by the counterparties).

Commodity Options

			Natural Gas (NYMEX HH)			Oil (NYMEX WTI)
Instrument	Option Expiration	Underlying Swap Term	Underlying Swap Bbtu Per Day	Underlying Swap Weighted Average Hedged Price per MMBtu		Underlying Swap Barrels Per Day	Underlying Swap Hedged Price per Bbl
Gas Swaptions	December 2011	Calendar 2012	50	$	5.28	—	$	—
Oil Swaptions	December 2011	Calendar 2012	—	—		3,000	90.00
Oil Swaptions	December 2012	Calendar 2013	—	—		2,000	120.00
Oil Call Option	Monthly in 2011	Monthly in 2011	—	—		1,000	90.00

Schedule of commodity swaps granted subsequent to the balance sheet date

Subsequent to June 30, 2011, through August 2, 2011, LPR Canada entered into the following swaps:

Commodity Swaps

	Oil (NYMEX WTI)
Swap Term	Barrels Per Day	Weighted Average Hedged Price per Bbl
August 2011 - December 2011	2,000	$	100.29
Calendar 2012	1,500	101.72

Schedule of outstanding fixed-to-floating interest rate swaps

The table below sets forth Forest’s outstanding fixed-to-floating interest rate swaps as of June 30, 2011.

Interest Rate Swaps

Remaining Swap Term	Notional Amount (In Thousands)		Weighted Average Floating Rate	Weighted Average Fixed Rate
July 2011 - February 2014	$	500,000	1 month LIBOR + 5.89%	8.50	%

Summary of location and fair value amounts of derivative instruments reported in the Condensed Consolidated Balance Sheets

	June 30, 2011		December 31, 2010
	(In Thousands)
Assets:
Commodity derivatives:
Current assets: derivative instruments	$	41,713	$	49,415
Derivative instruments	8,463		—
Interest rate derivatives:
Current assets: derivative instruments	10,894		10,767
Derivative instruments	9,879		8,244
Total assets	70,949		68,426
Liabilities:
Commodity derivatives:
Current liabilities: derivative instruments	42,428		36,413
Derivative instruments	5,390		—
Total liabilities	47,818		36,413
Net derivative fair value	$	23,131	$	32,013

Summary of the amount of derivative instrument gains and losses reported in the condensed consolidated statements of operations

	Three Months Ended June 30,						Six Months Ended June 30,
	2011			2010			2011			2010
	(In Thousands)
Commodity derivatives:
Realized gains	$	(2,271	)	$	(31,215	)	$	(12,839	)	$	(37,663	)
Unrealized (gains) losses	(35,716		)	25,005			10,642			(54,617		)
Interest rate derivatives:
Realized gains	(2,872		)	(3,310		)	(5,842		)	(6,831		)
Unrealized gains	(5,188		)	(15,511		)	(1,762		)	(19,131		)
Realized and unrealized gains on derivative instruments, net	$	(46,047	)	$	(25,031	)	$	(9,801	)	$	(118,242	)