Commitments and Contingencies

9 Months Ended

Sep. 30, 2011

Commitments and Contingencies

10.    Commitments and Contingencies

Commitments

Our most significant commitments consist of the purchase of oil and gas well drilling services, fracturing chemicals and compression services, capacity utilization under firm transportation service agreements and operating lease rentals for equipment and office space, 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 the quarter ended September 30, 2011, we recorded a $0.3 million reserve for litigation attributable to certain properties that were previously sold. During 2010, we established a $0.9 million reserve for a litigation matter pertaining to certain properties that remains outstanding as of September 30, 2011. During 2010, we also established a $0.5 million reserve for a sales and use tax audit contingency, which was ultimately resolved during the quarter ended September 30, 2011 for $0.3 million. In addition, as of September 30, 2011, we have an ARO liability of approximately $6.0 million attributable to the plugging of abandoned wells.