Fair Value Measurements (Tables)

12 Months Ended

Dec. 31, 2013

Hierarchy of Fair Value, Assets and Liabilities Measured on Recurring Basis

The following tables set forth by level within the fair value hierarchy the Company’s financial assets and liabilities that were accounted for at fair value on a recurring basis:



	At fair value as of December 31, 2013
	Level 1		Level 2		Level 3		Total
	(In thousands)
Assets:
Money market funds	$	742	$	—	$	—	$	742
Commodity derivative instruments (see Note 4)	—		3,597		—		3,597
Total assets	$	742	$	3,597	$	—	$	4,339
Liabilities:
Commodity derivative instruments (see Note 4)	$	—	$	8,327	$	—	$	8,327
Total liabilities	$	—	$	8,327	$	—	$	8,327

	At fair value as of December 31, 2012
	Level 1		Level 2		Level 3		Total
	(In thousands)
Assets:
Money market funds	$	66,387	$	—	$	—	$	66,387
Commodity derivative instruments (see Note 4)	—		23,997		—		23,997
Total assets	$	66,387	$	23,997	$	—	$	90,384
Liabilities:
Commodity derivative instruments (see Note 4)	$	—	$	1,428	$	—	$	1,428
Total liabilities	$	—	$	1,428	$	—	$	1,428

Reconciliation of Changes in Fair Value of Level 3 Derivative Instruments

The following table presents a reconciliation of the changes in fair value of the derivative instruments classified as Level 3 in the fair value hierarchy for the years presented. The Level 3 instruments presented below consist of derivative instruments, which include oil collars, swaps and puts.



	2013		2012			2011
	(In thousands)
Balance as of January 1	$	—	$	(5,050	)	$	(10,486	)
Total gains or (losses):
Included in earnings	—		—			1,595
Included in other comprehensive income	—		—			—
Purchases, issuances and settlements	—		—			3,841
Transfers in and out of Level 3⁽¹⁾	—		5,050			—
Balance as of December 31	$	—	$	—		$	(5,050	)
Change in fair value included in earnings relating to derivatives instruments still held at December 31	$	—	$	—		$	5,436


(1)	During the year ended December 31, 2012, the inputs used to value the Company’s commodity derivative instruments were directly or indirectly observable and those contracts were transferred to Level 2.

- Definition

Tabular disclosure of the fair value measurement of liabilities using significant unobservable inputs (Level 3), a reconciliation of the beginning and ending balances, separately presenting changes attributable to the following: (1) total gains or losses for the period (realized and unrealized), segregating those gains or losses included in earnings (or changes in net assets), and gains or losses recognized in other comprehensive income (loss) and a description of where those gains or losses included in earnings (or changes in net assets) are reported in the statement of income (or activities); (2) purchases, sales, issues, and settlements (each type disclosed separately); and (3) transfers in and transfers out of Level 3 (for example, transfers due to changes in the observability of significant inputs) by class of liability.

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