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FAIR VALUE MEASUREMENTS (Notes) | 12 Months Ended
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Dec. 31, 2021
Fair Value Disclosures [Abstract] |
FAIR VALUE MEASUREMENTS | FAIR VALUE MEASUREMENTS Recurring Fair Value Measurements - The following tables set forth our recurring fair value measurements for the periods indicated:
|  | December 31, 2021
|  | Level 1 |  | Level 2 |  | Level 3 |  | Total - Gross |  | Netting (a) |  | Total - Net
|  | (Thousands of dollars)
Derivative assets |  |  |  |  |  |  |  |  |  |  |  |
Commodity contracts |  |  |  |  |  |  |  |  |  |  |  |
Financial contracts |  | $ | 22,019 |  |  | $ | 172,833 |  |  | $ | 9,309 |  |  | $ | 204,161 |  |  | $ | (204,161) |  |  | $ | — |
Total derivative assets |  | $ | 22,019 |  |  | $ | 172,833 |  |  | $ | 9,309 |  |  | $ | 204,161 |  |  | $ | (204,161) |  |  | $ | — |
Derivative liabilities |  |  |  |  |  |  |  |  |  |  |  |
Commodity contracts |  |  |  |  |  |  |  |  |  |  |  |
Financial contracts |  | $ | (67,226) |  |  | $ | (112,922) |  |  | $ | (123,592) |  |  | $ | (303,740) |  |  | $ | 303,740 |  |  | $ | — |
Interest-rate contracts |  | — |  |  | (145,524) |  |  | — |  |  | (145,524) |  |  | — |  |  | (145,524) |
Total derivative liabilities |  | $ | (67,226) |  |  | $ | (258,446) |  |  | $ | (123,592) |  |  | $ | (449,264) |  |  | $ | 303,740 |  |  | $ | (145,524) |
(a) - Derivative assets and liabilities are presented in our Consolidated Balance Sheet on a net basis. We net derivative assets and liabilities when a legally enforceable master-netting arrangement exists between the counterparty to a derivative contract and us. At December 31, 2021, we held no cash and posted $157.0 million of cash with various counterparties, including $99.6 million of cash collateral that is offsetting derivative net liability positions under master-netting arrangements in the table above. The remaining $57.4 million of cash collateral in excess of derivative net liability positions is included in other current assets in our Consolidated Balance Sheet.
|  | December 31, 2020
|  | Level 1 |  | Level 2 |  | Level 3 |  | Total - Gross |  | Netting (a) |  | Total - Net
|  | (Thousands of dollars)
Derivative assets |  |  |  |  |  |  |  |  |  |  |  |
Commodity contracts |  |  |  |  |  |  |  |  |  |  |  |
Financial contracts |  | $ | 6,697 |  |  | $ | — |  |  | $ | 103,801 |  |  | $ | 110,498 |  |  | $ | (110,498) |  |  | $ | — |
Total derivative assets |  | $ | 6,697 |  |  | $ | — |  |  | $ | 103,801 |  |  | $ | 110,498 |  |  | $ | (110,498) |  |  | $ | — |
Derivative liabilities |  |  |  |  |  |  |  |  |  |  |  |
Commodity contracts |  |  |  |  |  |  |  |  |  |  |  |
Financial contracts |  | $ | (10,489) |  |  | $ | — |  |  | $ | (135,122) |  |  | $ | (145,611) |  |  | $ | 145,611 |  |  | $ | — |
Interest-rate contracts |  | — |  |  | (203,407) |  |  | — |  |  | (203,407) |  |  | — |  |  | (203,407) |
Total derivative liabilities |  | $ | (10,489) |  |  | $ | (203,407) |  |  | $ | (135,122) |  |  | $ | (349,018) |  |  | $ | 145,611 |  |  | $ | (203,407) |
(a) - Derivative assets and liabilities are presented in our Consolidated Balance Sheet on a net basis. We net derivative assets and liabilities when a legally enforceable master-netting arrangement exists between the counterparty to a derivative contract and us. At December 31, 2020, we held no cash and posted $63.1 million of cash with various counterparties, including $35.1 million of cash collateral that is offsetting derivative net liability positions under master-netting arrangements in the table above. The remaining $28.0 million of cash collateral in excess of derivative net liability positions is included in other current assets in our Consolidated Balance Sheet. The following table sets forth a reconciliation of our Level 3 fair value measurements for the periods indicated:
|  | Years Ended
|  | December 31,
Derivative Assets (Liabilities) |  | 2021 |  | 2020
|  | (Thousands of dollars)
Net assets (liabilities) at beginning of period |  | $ | (31,321) |  |  | $ | 30,772 |
Total changes in fair value: |  |  |  |
Settlements included in net income (a) |  | 31,003 |  |  | (31,660) |
Transfers out of Level 3 derivatives |  | (59,911) |  |  | — |
New Level 3 derivatives included in other comprehensive income (loss) (b) |  | (57,325) |  |  | (36,568) |
Unrealized change included in other comprehensive income (loss) (b) |  | 3,271 |  |  | 6,135 |
Net liabilities at end of period |  | $ | (114,283) |  |  | $ | (31,321) |
(a) - Included in commodity sales revenues/cost of sales and fuel in our Consolidated Statements of Income. (b) - Included in change in fair value of derivatives in our Consolidated Statements of Comprehensive Income. During the year ended December 31, 2021, transfers out of Level 3 related to commodity derivatives associated with certain locations for both NGL and natural gas basis swaps were principally due to improved transparency of market prices as a result of the volume and frequency of transactions in these markets. We consider the valuation of these commodity derivatives transacted through a clearing broker and valued with an unadjusted published price from an exchange as a Level 2 valuation. Our Level 3 fair value measurements continue to include NGL derivatives in other markets valued using forward quotes provided by third-party pricing services that are validated with other unobservable market data. During the year ended December 31, 2020, there were no transfers in or out of Level 3 of the fair value hierarchy. Other Financial Instruments - The approximate fair value of cash and cash equivalents, accounts receivable, accounts payable and short-term borrowings is equal to book value due to the short-term nature of these items. Our cash and cash equivalents are composed of bank and money market accounts and are classified as Level 1. Our short-term borrowings are classified as Level 2 since the estimated fair value of the short-term borrowings can be determined using information available in the commercial paper market. We have investments at December 31, 2021, associated with our supplemental executive retirement plan and nonqualified deferred compensation plan that are carried at fair value and primarily composed of exchange-traded mutual funds classified as Level 1. The estimated fair value of our consolidated long-term debt, including current maturities, was $15.6 billion and $16.3 billion at December 31, 2021 and 2020, respectively. The book value of our consolidated long-term debt, including current maturities, was $13.6 billion and $14.2 billion at December 31, 2021 and 2020, respectively. The estimated fair value of the aggregate senior notes outstanding was determined using quoted market prices for similar issues with similar terms and maturities. The estimated fair value of our consolidated long-term debt is classified as Level 2.

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- Definition The entire disclosure for the fair value of financial instruments (as defined), including financial assets and financial liabilities (collectively, as defined), and the measurements of those instruments as well as disclosures related to the fair value of non-financial assets and liabilities. Such disclosures about the financial instruments, assets, and liabilities would include: (1) the fair value of the required items together with their carrying amounts (as appropriate); (2) for items for which it is not practicable to estimate fair value, disclosure would include: (a) information pertinent to estimating fair value (including, carrying amount, effective interest rate, and maturity, and (b) the reasons why it is not practicable to estimate fair value; (3) significant concentrations of credit risk including: (a) information about the activity, region, or economic characteristics identifying a concentration, (b) the maximum amount of loss the entity is exposed to based on the gross fair value of the related item, (c) policy for requiring collateral or other security and information as to accessing such collateral or security, and (d) the nature and brief description of such collateral or security; (4) quantitative information about market risks and how such risks are managed; (5) for items measured on both a recurring and nonrecurring basis information regarding the inputs used to develop the fair value measurement; and (6) for items presented in the financial statement for which fair value measurement is elected: (a) information necessary to understand the reasons for the election, (b) discussion of the effect of fair value changes on earnings, (c) a description of [similar groups] items for which the election is made and the relation thereof to the balance sheet, the aggregate carrying value of items included in the balance sheet that are not eligible for the election; (7) all other required (as defined) and desired information. + References Reference 1: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 820 -SubTopic 10 -Section 50 -Paragraph 2 -URI http://asc.fasb.org/extlink&oid=123874694&loc=d3e19207-110258 + Details
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