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Derivative Activities (Tables) | 9 Months Ended
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Sep. 30, 2017
Derivative Instruments And Hedging Activities Disclosure [Abstract] |
Derivative Volumes Hedged and Average Hedge Prices | The following table sets forth our commodity-based derivative volumes by year as of September 30, 2017, excluding our basis and freight swaps which are discussed separately below:
Period |  | Contract Type |  | Volume Hedged |  | Weighted Average Hedge Price
Natural Gas |  |  |  |  |  |  |  |
2017 |  | Swaps (1) |  | 878,370 Mmbtu/day |  |  | $ 3.21 |
2018 |  | Swaps |  | 477,534 Mmbtu/day |  |  | $ 3.22 |
January-March 2019 |  | Swaps |  | 50,000 Mmbtu/day |  |  | $ 3.01 |
2017 |  | Collars (1) |  | 122,609 Mmbtu/day |  |  | $ 3.45–$ 4.11 |
2018 |  | Collars |  | 60,000 Mmbtu/day |  |  | $ 3.40–$ 3.76 |
2017 |  | Purchased Puts (1) |  | 185,870 Mmbtu/day |  |  | $ 3.50 (2) |
2017 |  | Sold Calls |  | 17,935 Mmbtu/day |  |  | $ 3.75 (3) |
April-December 2018 |  | Swaptions |  | 320,000 Mmbtu/day (4) |  |  | $ 3.04 (4) |
2019 |  | Swaptions |  | 60,000 Mmbtu/day (4) |  |  | $ 3.00 (4) |
Crude Oil |  |  |  |  |  |  |  |
2017 |  | Swaps (1) |  | 9,511 bbls/day |  |  | $ 56.03 |
2018 |  | Swaps |  | 6,000 bbls/day |  |  | $ 52.96 |
2019 |  | Swaps |  | 1,000 bbls/day |  |  | $ 51.50 |
NGLs (C2-Ethane) |  |  |  |  |  |  |  |
2017 |  | Swaps |  | 3,000 bbls/day |  |  | $ 0.27/gallon |
2018 |  | Swaps |  | 250 bbls/day |  |  | $ 0.29/gallon |
NGLs (C3-Propane) |  |  |  |  |  |  |  |
2017 |  | Swaps |  | 17,576 bbls/day |  |  | $ 0.61/gallon |
2018 |  | Swaps |  | 8,935 bbls/day |  |  | $0.66/gallon |
NGLs (NC4-Normal Butane) |  |  |  |  |  |  |  |
2017 |  | Swaps |  | 9,000 bbls/day |  |  | $ 0.76/gallon |
2018 |  | Swaps |  | 4,558 bbls/day |  |  | $ 0.81/gallon |
NGLs (C5-Natural Gasoline) |  |  |  |  |  |  |  |
2017 |  | Swaps |  | 6,416 bbls/day |  |  | $ 1.08/gallon |
2018 |  | Swaps |  | 4,027 bbls/day |  |  | $ 1.17/gallon |
(1) | Includes derivative instruments assumed in connection with the MRD Merger.
(2) | Weighted average deferred premium is ($0.32).
(3) | Weighted average deferred premium is $0.31.
(4) | Contains a combined derivative instrument consisting of a fixed price swap and a sold option to extend or double the volume. For April through December of 2018, we have swaps in place for 160,000 Mmbtu per day on which the counterparty can elect to double the volume at a weighted average price of $3.02. We also have swaps in place for 160,000 Mmbtu per day on which the counterparty can elect to extend the contract through December 2019 at a weighted average price of $3.07. In 2019, if the counterparty elects to double the volume, we would have additional swaps covering 60,000 Mmbtu per day at a weighted average price of $3.00.
Combined Fair Value of Derivatives, by Consolidated Balance Sheets | The combined fair value of derivatives included in the accompanying consolidated balance sheets as of September 30, 2017 and December 31, 2016 is summarized below. The assets and liabilities are netted where derivatives with both gain and loss positions are held by a single counterparty and we have master netting arrangements. The tables below provide additional information relating to our master netting arrangements with our derivative counterparties (in thousands):
|  |  | September 30, 2017 |
|  |  | Gross Amounts of Recognized Assets |  |  | Gross Amounts Offset in the Balance Sheet |  |  | Net Amounts of Assets Presented in the Balance Sheet |
Derivative assets: |  |  |  |  |  |  |  |  |  |  |  |  |
Natural gas | –swaps |  | $ | 37,288 |  |  | $ | (12,385 | ) |  | $ | 24,903 |
| –swaptions |  |  | 9,092 |  |  |  | (8,711 | ) |  |  | 381 |
| –basis swaps |  |  | 3,782 |  |  |  | (2,774 | ) |  |  | 1,008 |
| –collars |  |  | 6,214 |  |  |  | (2,101 | ) |  |  | 4,113 |
| –puts |  |  | 8,547 |  |  |  | (4,238 | ) |  |  | 4,309 |
Crude oil | –swaps |  |  | 7,133 |  |  |  | (2,918 | ) |  |  | 4,215 |
NGLs | –C2 ethane swaps |  |  | 82 |  |  |  | (82 | ) |  |  | — |
| –C3 propane swaps |  |  | — |  |  |  | (2,956 | ) |  |  | (2,956 | )
| –C3 propane basis swaps |  |  | 18,169 |  |  |  | (18,169 | ) |  |  | — |
| –NC4 butane swaps |  |  | 34 |  |  |  | (4,340 | ) |  |  | (4,306 | )
| –C5 natural gasoline swaps |  |  | 115 |  |  |  | (1,094 | ) |  |  | (979 | )
Freight | –swaps |  |  | 47 |  |  |  | (47 | ) |  |  | — |
|  |  | $ | 90,503 |  |  | $ | (59,815 | ) |  | $ | 30,688 |
|  |  | September 30, 2017 |
|  |  | Gross Amounts of Recognized (Liabilities) |  |  | Gross Amounts Offset in the Balance Sheet |  |  | Net Amounts of (Liabilities) Presented in the Balance Sheet |
Derivative liabilities: |  |  |  |  |  |  |  |  |  |  |  |  |
Natural gas | –swaps |  | $ | (10,805 | ) |  | $ | 12,385 |  |  | $ | 1,580 |
| –swaptions |  |  | (16,694 | ) |  |  | 8,711 |  |  |  | (7,983 | )
| –basis swaps |  |  | (8,458 | ) |  |  | 2,774 |  |  |  | (5,684 | )
| –collars |  |  | — |  |  |  | 2,101 |  |  |  | 2,101 |
| –puts |  |  | — |  |  |  | 4,238 |  |  |  | 4,238 |
| –calls |  |  | (29 | ) |  |  | — |  |  |  | (29 | )
Crude oil | –swaps |  |  | (1,031 | ) |  |  | 2,918 |  |  |  | 1,887 |
NGLs | –C2 ethane swaps |  |  | (125 | ) |  |  | 82 |  |  |  | (43 | )
| –C3 propane swaps |  |  | (36,046 | ) |  |  | 2,956 |  |  |  | (33,090 | )
| –C3 propane basis swaps |  |  | (17,072 | ) |  |  | 18,169 |  |  |  | 1,097 |
| –NC4 butane swaps |  |  | (13,700 | ) |  |  | 4,340 |  |  |  | (9,360 | )
| –C5 natural gasoline swaps |  |  | (4,678 | ) |  |  | 1,094 |  |  |  | (3,584 | )
Freight | –swaps |  |  | (2 | ) |  |  | 47 |  |  |  | 45 |
|  |  | $ | (108,640 | ) |  | $ | 59,815 |  |  | $ | (48,825 | )
|  |  | December 31, 2016 |
|  |  | Gross Amounts of Recognized Assets |  |  | Gross Amounts Offset in the Balance Sheet |  |  | Net Amounts of Assets Presented in the Balance Sheet |
Derivative assets: |  |  |  |  |  |  |  |  |  |  |  |  |
Natural gas | –swaps |  | $ | 13,213 |  |  | $ | (11,425 | ) |  | $ | 1,788 |
| –basis swaps |  |  | 12,535 |  |  |  | (9,437 | ) |  |  | 3,098 |
| –collars |  |  | 6,298 |  |  |  | (6,298 | ) |  |  | — |
| –puts |  |  | 18,159 |  |  |  | (15,429 | ) |  |  | 2,730 |
Crude oil | –swaps |  |  | 9,356 |  |  |  | (3,489 | ) |  |  | 5,867 |
NGLs | –C2 ethane swaps |  |  | 53 |  |  |  | (53 | ) |  |  | — |
| –C3 propane basis swaps |  |  | 17,396 |  |  |  | (17,396 | ) |  |  | — |
| –NC4 butane swaps |  |  | 4 |  |  |  | (4 | ) |  |  | — |
Freight | –swaps |  |  | 65 |  |  |  | (65 | ) |  |  | — |
|  |  | $ | 77,079 |  |  | $ | (63,596 | ) |  | $ | 13,483 |
|  |  | December 31, 2016 |
|  |  | Gross Amounts of Recognized (Liabilities) |  |  | Gross Amounts Offset in the Balance Sheet |  |  | Net Amounts of (Liabilities) Presented in the Balance Sheet |
Derivative liabilities: |  |  |  |  |  |  |  |  |  |  |  |  |
Natural gas | –swaps |  | $ | (158,359 | ) |  | $ | 11,425 |  |  | $ | (146,934 | )
| –basis swaps |  |  | (687 | ) |  |  | 9,437 |  |  |  | 8,750 |
| –collars |  |  | (2,625 | ) |  |  | 6,298 |  |  |  | 3,673 |
| –puts |  |  | — |  |  |  | 15,429 |  |  |  | 15,429 |
| –calls |  |  | (1,041 | ) |  |  | — |  |  |  | (1,041 | )
Crude oil | –swaps |  |  | (13,206 | ) |  |  | 3,489 |  |  |  | (9,717 | )
NGLs | –C2 ethane swaps |  |  | (1,008 | ) |  |  | 53 |  |  |  | (955 | )
| –C3 propane swaps |  |  | (32,437 | ) |  |  | — |  |  |  | (32,437 | )
| –C3 propane basis swaps |  |  | (18,138 | ) |  |  | 17,396 |  |  |  | (742 | )
| –NC4 butane swaps |  |  | (13,419 | ) |  |  | 4 |  |  |  | (13,415 | )
| –C5 natural gasoline swaps |  |  | (12,176 | ) |  |  | — |  |  |  | (12,176 | )
Freight | –swaps |  |  | — |  |  |  | 65 |  |  |  | 65 |
|  |  | $ | (253,096 | ) |  | $ | 63,596 |  |  | $ | (189,500 | )
Effects of Derivatives on Consolidated Statements of Operations | The effects of our derivatives on our consolidated statements of operations are summarized below (in thousands):
| Derivative Fair Value (Loss) Income |
|  | Three Months Ended September 30, |  |  |  | Nine Months Ended September 30, |
| 2017 |  |  |  | 2016 |  |  |  | 2017 |  |  |  | 2016 |
Commodity swaps | $ | (87,861 | ) |  | $ | 38,662 |  |  | $ | 172,457 |  |  | $ | (40,270 | )
Swaptions |  | (7,602 | ) |  |  | — |  |  |  | (7,602 | ) |  |  | — |
Collars |  | 956 |  |  |  | 1,320 |  |  |  | 15,221 |  |  |  | 1,320 |
Puts |  | (73 | ) |  |  | 2,842 |  |  |  | 9,646 |  |  |  | 2,842 |
Calls |  | 104 |  |  |  | — |  |  |  | 1,144 |  |  |  | — |
Basis swaps |  | 6,113 |  |  |  | 21,853 |  |  |  | (2,554 | ) |  |  | 24,929 |
Freight swaps |  | (63 | ) |  |  | (121 | ) |  |  | 14 |  |  |  | (155 | )
Total | $ | (88,426 | ) |  | $ | 64,556 |  |  | $ | 188,326 |  |  | $ | (11,334 | )

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