Commitments and Contingencies

The following table sets forth our significant commitments as of December 31, 2013, by category, for the next five years and thereafter:



Year	Minimum Rentals		Drilling and Completion		Firm Transportation		Other Commitments
2014	$	1,884	$	88,398	$	2,002	$	4,021
2015	1,808		4,615		2,002		4,429
2016	1,702		—		1,095		5,138
2017	652		—		1,095		—
2018	666		—		1,095		—
Thereafter	681		—		10,767		—
Total	$	7,393	$	93,013	$	18,056	$	13,588

Rental Commitments

Operating lease rental expense in the years ended December 31, 2013, 2012 and 2011 was $9.4 million, $11.0 million and $11.4 million, respectively, related primarily to field equipment, office equipment and office leases.

Drilling and Completion Commitments

We have agreements to purchase oil and gas well drilling and well completion services from third parties with original terms of up to two years. As of December 31, 2013, there were no well drilling or well completion agreements with terms that extended beyond December 31, 2014. The well drilling agreements include early termination provisions that would require us to pay penalties if we terminate the agreements prior to the end of their original terms. The amount of penalty is based on the number of days remaining in the contractual term. As of December 31, 2013, the penalty amount would have been $19.0 million if we had terminated our agreements on that date.

Firm Transportation Commitments

We have entered into contracts that provide firm transportation capacity rights for specified volumes per day on various pipeline systems with terms that range from 1 to 15 years. The contracts require us to pay transportation demand charges regardless of the amount of pipeline capacity we use. We may sell excess capacity to third parties at our discretion.

Other Commitments

We have entered into certain contractual arrangements for other products and services. We have purchase commitments for certain bulk equipment and materials utilized in the construction of our production facilities, minimum commitments under a natural gas gathering and compression service agreement for a portion of our natural gas and NGL production, information technology licensing and service agreements and certain consulting agreements, among others.

Legal

We are involved, from time to time, in various legal proceedings arising in the ordinary course of business. While the ultimate results of these proceedings cannot be predicted with certainty, our management believes that these claims will not have a material effect on our financial position, results of operations or cash flows. During 2010, we established a $0.9 million reserve for a litigation matter pertaining to certain properties that remains outstanding as of December 31, 2013. In addition to the reserve for litigation, we maintain a suspense account which includes approximately $1.9 million representing the excess of revenues received over costs incurred attributable to these properties. As discussed in Note 3, we are involved in an arbitration with the seller in connection with our 2013 EF Acquisition.

Environmental Compliance

Extensive federal, state and local laws govern oil and gas operations, regulate the discharge of materials into the environment or otherwise relate to the protection of the environment. Numerous governmental departments issue rules and regulations to implement and enforce such laws that are often difficult and costly to comply with and which carry substantial administrative, civil and even criminal penalties for failure to comply. Some laws, rules and regulations relating to protection of the environment may, in certain circumstances, impose “strict liability” for environmental contamination, rendering a person liable for environmental and natural resource damages and cleanup costs without regard to negligence or fault on the part of such person. Other laws, rules and regulations may restrict the rate of oil and gas production below the rate that would otherwise exist or even prohibit exploration or production activities in sensitive areas. In addition, state laws often require some form of remedial action to prevent pollution from former operations, such as plugging of abandoned wells. As of December 31, 2013, we have recorded AROs of $6.4 million attributable to these activities. The regulatory burden on the oil and gas industry increases its cost of doing business and consequently affects its profitability. These laws, rules and regulations affect our operations, as well as the oil and gas exploration and production industry in general. We believe that we are in substantial compliance with current applicable environmental laws, rules and regulations and that continued compliance with existing requirements will not have a material impact on our financial condition or results of operations. Nevertheless, changes in existing environmental laws or the adoption of new environmental laws, including any significant limitation on the use of hydraulic fracturing, have the potential to adversely affect our operations.