Commitments and Contingencies

6 Months Ended

Jun. 30, 2011

Commitments and Contingencies

10.        Commitments and Contingencies

Commitments

Our most significant commitments consist of operating lease rentals for equipment and office space, the purchase of oil and gas well drilling services and capacity utilization under firm transportation service agreements, as more fully described in our Annual Report on Form 10-K for the year ended December 31, 2010.

Contingencies - Legal and Regulatory

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 or results of operations. During 2010, we established a $0.9 million reserve for a litigation matter and a $0.5 million reserve for a sales and use tax audit contingency. In addition, as of June 30, 2011, we have recorded AROs of $7.3 million attributable to the plugging of abandoned wells.