CONCENTRATION OF RISK

12 Months Ended

Dec. 31, 2011

Concentration Risks, Types, No Concentration Percentage [Abstract]

Concentration Risk Disclosure [Text Block]

CONCENTRATION OF RISK

Accounts Receivable. The following table presents the components of accounts receivable, net.

	As of December 31,
	2011			2010
	(in thousands)
Natural gas, NGL and crude oil sales	$	42,388		$	27,730
Joint interest billings	7,465			12,142
Natural gas marketing	6,225			8,279
Other	4,766			6,513
Allowance for doubtful accounts	(921		)	(686		)
Accounts receivable, net	$	59,923		$	53,978

Our accounts receivable are primarily from purchasers of our natural gas, NGL and crude oil production, derivative counterparties and other third parties which own working interests in the properties that we operate. Inherent to our industry is the concentration of natural gas, NGL and crude oil sales to a few customers. This industry concentration has the potential to impact our overall exposure to credit risk, either positively or negatively, in that our customers may be similarly affected by changes in economic and financial conditions, commodity prices or other conditions. We record an allowance for doubtful accounts for receivables that we estimate to be uncollectible. In making our

estimate, we consider, among other things, our historical write-offs and overall creditworthiness of our customers. Further, consideration is given to well production data for receivables related to well operations. It is reasonably possible that our estimate of uncollectible amounts will change periodically. For the each of the years in the three-year period ended December 31, 2011, amounts written off to allowance for doubtful accounts were not material. As of December 31, 2011, we had one customer representing 10% or greater of our accounts receivable balance, Suncor Energy Marketing, Inc., which represented 16% of our accounts receivable balance.

Major Customers. The following table presents the individual customers constituting 10% or more of total revenues.

	Year Ended December 31,
Customer	2011		2010		2009
Suncor Energy Marketing, Inc.	25.7	%	19.6	%	18.6	%
Williams Production RMT Company	9.9	%	12.5	%	16.1	%
DCP Midstream, LP	11.5	%	9.6	%	11.9	%

Derivative Counterparties. A significant portion of our liquidity is concentrated in derivative instruments that enable us to manage a portion of our exposure to price volatility from producing natural gas and crude oil. These arrangements expose us to credit risk of nonperformance by our counterparties. We primarily use financial institutions, who are also major lenders in our credit facility agreement, as counterparties to our derivative contracts. To date, we have had no counterparty default losses. We have evaluated the credit risk of our derivative assets from our counterparties using relevant credit market default rates, giving consideration to amounts outstanding for each counterparty and the duration of each outstanding derivative position. Based on our evaluation, the impact of the nonperformance of our counterparties on the fair value of our derivative instruments is not significant.

The following table presents the counterparties that expose us to credit risk as of December 31, 2011, with regard to our derivative assets.

	Fair Value of Derivative Assets
Counterparty Name	As of December 31, 2011
	(in thousands)
JPMorgan Chase Bank, N.A. (1)	$	48,855
Crèdit Agricole CIB (1)	21,597
Wells Fargo Bank, N.A. (1)	20,519
Various (2)	11,013
Total	$	101,984

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(1)Major lender in our credit facility, see Note 8.

(2)Represents a total of 14 counterparties, including three lenders in our credit facility.