Derivative Financial Instruments (Tables)

3 Months Ended

Mar. 31, 2018

Derivative [Line Items]

Schedule of Notional Amounts of Outstanding Derivative Positions [Table Text Block]

As of March 31, 2018, we had the following outstanding derivative contracts. When aggregating multiple contracts, the weighted average contract price is disclosed.

	Collars					Fixed-Price Swaps
Commodity/ Index/ Maturity Period	Quantity (Gas - BBtu Oil - MBbls)	Weighted-Average Contract Price				Quantity (Oil - MBbls Gas and Basis- BBtu  Propane - MBbls)	Weighted- Average Contract Price			Fair Value March 31, 2018 (1) (in millions)
		Floors		Ceilings
Crude Oil
NYMEX
2018	1,784.0	$	46.64	$	57.53	7,704.0	$	52.54		$	(91.4	)
2019	400.0	50.00		60.67		7,800.0	53.20			(42.9		)
Total Crude Oil	2,184.0					15,504.0				$	(134.3	)
Natural Gas
NYMEX
2018	2,735.0	$	3.00	$	3.56	40,335.0	$	2.94		$	5.1
2019	—	—		—		4,004.0	2.77			(0.1		)
Total Natural Gas	2,735.0					44,339.0				$	5.0
Basis Protection - Crude Oil
Midland Cushing
2018	—	$	—	$	—	1,456.1	$	(0.10	)	$	5.4
Total Basis Protection - Crude Oil	—					1,456.1				$	5.4
Basis Protection - Natural Gas
CIG
2018	—	$	—	$	—	31,409.9	$	(0.43	)	$	12.3
2019	—	—		—		4,004.0	(0.88		)	(0.1		)
Waha
2018	—	—		—		4,923.8	(0.50		)	3.4
El Paso
2018	—	—		—		2,450.0	(0.62		)	1.6
Total Basis Protection - Natural Gas	—					42,787.7				$	17.2
Propane
Mont Belvieu
2018	—	$	—	$	—	714.4	$	32.52		$	—
Total Propane	—					714.4				$	—
Rollfactor (2)
Crude Oil CMA
2018	—	$	—	$	—	4,192	$	0.12		$	(1.8	)
Total Rollfactor	—					4,192				$	(1.8	)
Commodity Derivatives Fair Value										$	(108.5	)

_____________

(1) Approximately 21.5 percent of the fair value of our commodity derivative assets and 10.9 percentof the fair value of our commodity derivative liabilities were measured using significant unobservable inputs (Level 3).

(2) These positions hedge the timing risk associated with our physical sales. We generally sell crude oil for the delivery month at a sales price based on the average NYMEX West Texas Intermediate price during that month, plus an adjustment calculated as a spread between the weighted average prices of the delivery month, the next month and the following month during the period when the delivery month is the first month.

^[1],[2]

Schedule of Derivatives Instruments Statements of Financial Performance and Financial Position, Location [Table Text Block]

The following table presents the balance sheet location and fair value amounts of our derivative instruments on the condensed consolidated balance sheets:

			Fair Value
Derivative instruments:		Condensed consolidated balance sheet line item	March 31, 2018			December 31, 2017
			(in thousands)
Derivative assets:	Current
	Commodity derivative contracts	Fair value of derivatives	$	5,958		$	7,340
	Basis protection derivative contracts	Fair value of derivatives	22,652			6,998
			28,610			14,338
	Non-current		—			—
Total derivative assets			$	28,610		$	14,338
Derivative liabilities:	Current
	Commodity derivative contracts	Fair value of derivatives	108,763			77,999
	Basis protection derivative contracts	Fair value of derivatives	122			234
	Rollfactor derivative contracts	Fair value of derivatives	1,798			1,069
			110,683			79,302
	Non-current
	Commodity derivative contracts	Fair value of derivatives	26,447			22,343
	Basis protection derivative contracts	Fair value of derivatives	(21		)	—
			26,426			22,343
Total derivative liabilities			$	137,109		$	101,645

The following table presents the impact of our derivative instruments on our condensed consolidated statements of operations:

	Three Months Ended March 31,
Condensed consolidated statement of operations line item	2018			2017
	(in thousands)
Commodity price risk management gain (loss), net
Net settlements	$	(26,038	)	$	551
Net change in fair value of unsettled derivatives	(21,202		)	80,153
Total commodity price risk management gain (loss), net	$	(47,240	)	$	80,704

Schedule of Other Derivatives Not Designated as Hedging Instruments, Statements of Financial Performance and Financial Position, Location [Table Text Block]

The following table presents the balance sheet location and fair value amounts of our derivative instruments on the condensed consolidated balance sheets:

			Fair Value
Derivative instruments:		Condensed consolidated balance sheet line item	March 31, 2018			December 31, 2017
			(in thousands)
Derivative assets:	Current
	Commodity derivative contracts	Fair value of derivatives	$	5,958		$	7,340
	Basis protection derivative contracts	Fair value of derivatives	22,652			6,998
			28,610			14,338
	Non-current		—			—
Total derivative assets			$	28,610		$	14,338
Derivative liabilities:	Current
	Commodity derivative contracts	Fair value of derivatives	108,763			77,999
	Basis protection derivative contracts	Fair value of derivatives	122			234
	Rollfactor derivative contracts	Fair value of derivatives	1,798			1,069
			110,683			79,302
	Non-current
	Commodity derivative contracts	Fair value of derivatives	26,447			22,343
	Basis protection derivative contracts	Fair value of derivatives	(21		)	—
			26,426			22,343
Total derivative liabilities			$	137,109		$	101,645

The following table presents the impact of our derivative instruments on our condensed consolidated statements of operations:

	Three Months Ended March 31,
Condensed consolidated statement of operations line item	2018			2017
	(in thousands)
Commodity price risk management gain (loss), net
Net settlements	$	(26,038	)	$	551
Net change in fair value of unsettled derivatives	(21,202		)	80,153
Total commodity price risk management gain (loss), net	$	(47,240	)	$	80,704

Net settlements of commodity derivatives and net change in fair value of unsettled derivatives decreased for the three months ended March 31, 2018 as compared to the three months ended March 31, 2017 as a result of the increase in future commodity prices during the first quarter of 2018 compared to a decrease during the first quarter of 2017. 

All of our financial derivative agreements contain master netting provisions that provide for the net settlement of all contracts through a single payment in the event of early termination. We have elected not to offset the fair value positions recorded on our condensed consolidated balance sheets.

The following table reflects the impact of netting agreements on gross derivative assets and liabilities:

As of March 31, 2018	Derivative instruments, recorded in condensed consolidated balance sheet, gross		Effect of master netting agreements			Derivative instruments, net
	(in thousands)
Asset derivatives:
Derivative instruments, at fair value	$	28,610	$	(27,971	)	$	639
Liability derivatives:
Derivative instruments, at fair value	$	137,109	$	(27,971	)	$	109,138

As of December 31, 2017	Derivative instruments, recorded in condensed consolidated balance sheet, gross		Effect of master netting agreements			Derivative instruments, net
	(in thousands)
Asset derivatives:
Derivative instruments, at fair value	$	14,338	$	(14,173	)	$	165
Liability derivatives:
Derivative instruments, at fair value	$	101,645	$	(14,173	)	$	87,472

[1] Approximately 21.5 percent of the fair value of our commodity derivative assets and 10.9 percent of the fair value of our commodity derivative liabilities were measured using significant unobservable inputs (Level 3).

[2] These positions hedge the timing risk associated with our physical sales. We generally sell crude oil for the delivery month at a sales price based on the average NYMEX West Texas Intermediate price during that month, plus an adjustment calculated as a spread between the weighted average prices of the delivery month, the next month and the following month during the period when the delivery month is the first month.