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Fair Value Measurements
 12 Months Ended
Dec. 31, 2011
Fair Value Measurements  
Fair Value Measurements

(18) Fair Value Measurements

        In September 2006, the FASB issued ASC Topic 820 — Fair Value Measurements and Disclosures ("ASC 820"). ASC 820 established a single authoritative definition of fair value when accounting rules require the use of fair value, set out a framework for measuring fair value and required additional disclosures about fair value measurements. ASC 820 clarifies that fair value is an exit price, representing the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants.

        ASC 820 discusses valuation techniques, such as the market approach (prices and other relevant information generated by market conditions involving identical or comparable assets or liabilities), the income approach (techniques to convert future amounts to single present amounts based on market expectations including present value techniques and option-pricing), and the cost approach (amount that would be required to replace the service capacity of an asset which is often referred to as replacement cost). ASC 820 utilizes a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value into three broad levels. The following is a brief description of those three levels:

  • •
    Level 1 — Quoted prices in active market for identical assets and liabilities

    •
    Level 2 — Other significant observable inputs (including quoted prices in active markets for similar assets or liabilities)

    •
    Level 3 — Significant unobservable inputs (including the Company's own assumptions in determining the fair value)

        The following table sets forth the assets and liabilities measured at fair value on a recurring basis, by input level, as of December 31, 2011 and 2010:

 
   December 31, 2011  
 
   Level 1   Level 2   Level 3   Total  
 
   (in thousands)
  

Location and Description

                          

Cash equivalents

   $ 187,327   $ —   $ —   $ 187,327  

Other current assets (marketable securities)

     25     —     —     25  

Other current assets (other derivative agreements)

     —     63,051     —     63,051  

Other long-term assets (other derivative agreements)

     —     18,831     —     18,831  
                   

Total Assets

   $ 187,352   $ 81,882   $ —   $ 269,234  
                   

Other current liabilities (interest rate swap)

     —     (905 )   —     (905 )

Other long-term liabilities (interest rate swap)

     —     (1,483 )   —     (1,483 )
                   

Total Liabilities

   $ —   $ (2,388 ) $ —   $ (2,388 )
                   

 
   December 31, 2010  
 
   Level 1   Level 2   Level 3   Total  
 
   (in thousands)
  

Location and Description

                          

Cash equivalents

   $ 70,052   $ —   $ —   $ 70,052  

Other current assets (marketable securities)

     26     —     —     26  
                   

Total Assets

   $ 70,078   $ —   $ —   $ 70,078  
                   

Other current liabilities (Other derivative agreements)

     —     (4,043 )   —     (4,043 )
                   

Total Liabilities

   $ —   $ (4,043 ) $ —   $ (4,043 )
                   

        As of December 31, 2011, the only financial assets and liabilities that are measured at fair value on a recurring basis are the Company's cash equivalents, available-for-sale marketable securities and derivative instruments. Additionally, the fair value of the Company's Notes is disclosed in Note 13 ("Long-Term Debt"). The Company's commodity derivative contracts giving rise to an asset under Level 2 are valued using broker quoted market prices of similar commodity contracts. The Partnership has an interest rate swap that is measured at fair value on a recurring basis using Level 2 inputs. The fair value of these interest rate swap instruments are based on discounted cash flow models that incorporate the cash flows of the derivatives, as well as the current LIBOR rate and a forward LIBOR curve, along with other observable market inputs. The Company had no transfers of assets or liabilities between any of the above levels during the year ended December 31, 2011.