Commitments and Contingencies

12 Months Ended

Dec. 31, 2011

Commitments and Contingencies [Abstract]

Commitments and Contingencies

Note 14—Commitments and Contingencies

The Company is a party to ongoing litigation in the normal course of business. While the outcome of lawsuits or other proceedings against the Company cannot be predicted with certainty, management believes that the effect on its financial condition, results of operations and cash flows, if any, will not be material. At December 31, 2010 the Company had accrued $2.25 million in connection with estimated liabilities related to certain legal matters. All of these matters were settled during 2011, which resulted in an additional charge of $1.43 million included in other expense for the year ended December 31, 2011.

In January 2010, the Company recorded a gain relative to a $9 million cash settlement received from a lawsuit that was originally filed by the Company in 2008 relating to disputed interests in certain oil and gas assets purchased in 2007. The gain was reduced by approximately $0.8 million of costs incurred by the Company directly related to the settlement. In addition to the cash proceeds received, the Company was assigned additional working interests in certain producing properties. The Company recorded an additional $4.2 million non-cash gain representing the estimated fair market value of those interests on the effective date of the settlement, which represents a non-cash investing activity for purposes of the Statement of Cash Flows.

A portion of the production that the Company operates in Oklahoma is committed to a firm transportation agreement. Under the terms of the agreement, the Company must deliver 9.1 Bcf of natural gas per year through October 31, 2013.

Lease Commitments

The Company has operating leases for office space and equipment, which expire on various dates through 2017.

Future minimum lease commitments as of December 31, 2011 under these operating leases are as follows (in thousands):

		September 30,
2012	$	1,100
2013		396
2014		245
2015		228
2016		178
Thereafter		143
	$	2,290

Total rent expense under operating leases was approximately $1,342,000, $1,090,000 and $1,082,000 in 2011, 2010 and 2009, respectively.