XML 38 R17.htm IDEA: XBRL DOCUMENT
v2.4.0.8

Derivative Financial Instruments | 3 Months Ended
--- | ---
Mar. 31, 2014
Derivative Instruments and Hedging Activities Disclosure [Abstract] |
Derivative Financial Instruments | Note 10 - Derivative Financial Instruments Summary of Oil, Gas, and NGL Derivative Contracts in Place The Company has entered into various commodity derivative contracts to mitigate a portion of its exposure to potentially adverse market changes in commodity prices and the associated impact on cash flows. All contracts are entered into for other-than-trading purposes. The Company’s derivative contracts include swap and costless collar arrangements for oil, gas, and NGLs. As of March 31, 2014, and through the filing date of this report, the Company has commodity derivative contracts outstanding through the second quarter of 2018 for a total of 17.0 million Bbls of oil production, 216.6 million MMBtu of gas production, and 2.9 million Bbls of NGL production. In a typical commodity swap agreement, if the agreed upon published third-party index price is lower than the swap fixed price, the Company receives the difference between the index price and the agreed upon swap fixed price. If the index price is higher than the swap fixed price, the Company pays the difference. For collar agreements, the Company receives the difference between an agreed upon index and the floor price if the index price is below the floor price. The Company pays the difference between the agreed upon ceiling price and the index price if the index price is above the ceiling price. No amounts are paid or received if the index price is between the floor and ceiling prices. The following tables summarize the approximate volumes and average contract prices of contracts the Company had in place as of March 31, 2014, and through the filing date of this report: Oil Contracts Oil Swaps
Contract Period |  | NYMEX WTI Volumes |  | Weighted-Average Contract Price
|  | (Bbls) |  | (per Bbl)
Second quarter 2014 |  | 2,373,000 |  |  | $ | 94.95 |
Third quarter 2014 |  | 1,533,000 |  |  | $ | 96.04 |
Fourth quarter 2014 |  | 1,353,000 |  |  | $ | 94.88 |
2015 |  | 3,308,000 |  |  | $ | 89.34 |
2016 |  | 2,704,000 |  |  | $ | 85.19 |
All oil swaps |  | 11,271,000 |  |  |
Oil Collars
Contract Period |  | NYMEX WTI Volumes |  | Weighted- Average Floor Price |  | Weighted- Average Ceiling Price
|  | (Bbls) |  | (per Bbl) |  | (per Bbl)
Second quarter 2014 |  | 431,000 |  |  | $ | 85.00 |  |  | $ | 102.50 |
Third quarter 2014 |  | 973,000 |  |  | $ | 85.00 |  |  | $ | 102.58 |
Fourth quarter 2014 |  | 923,000 |  |  | $ | 85.00 |  |  | $ | 102.63 |
2015 |  | 3,366,000 |  |  | $ | 85.00 |  |  | $ | 94.25 |
All oil collars |  | 5,693,000 |  |  |  |  |
Gas Contracts Gas Swaps
Contract Period |  | Volumes |  | Weighted-Average Contract Price
|  | (MMBtu) |  | (per MMBtu)
Second quarter 2014 |  | 23,758,000 |  |  | $ | 3.98 |
Third quarter 2014 |  | 24,541,000 |  |  | $ | 4.02 |
Fourth quarter 2014 |  | 22,014,000 |  |  | $ | 4.02 |
2015 |  | 57,943,000 |  |  | $ | 4.04 |
2016 |  | 37,472,000 |  |  | $ | 4.17 |
2017 |  | 23,430,000 |  |  | $ | 4.21 |
2018 |  | 10,200,000 |  |  | $ | 4.31 |
All gas swaps* |  | 199,358,000 |  |  |
*Gas swaps are comprised of IF El Paso Permian (3%), IF HSC (83%), IF NGPL TXOK (2%), IF NNG Ventura (3%), IF Reliant N/S (8%), and IF CIG N System (1%). Gas Collars
Contract Period |  | Volumes |  | Weighted- Average Floor Price |  | Weighted- Average Ceiling Price
|  | (MMBtu) |  | (per MMBtu) |  | (per MMBtu)
Second quarter 2014 |  | 4,194,000 |  |  | $ | 4.38 |  |  | $ | 5.29 |
2015 |  | 13,002,000 |  |  | $ | 3.98 |  |  | $ | 4.30 |
All gas collars* |  | 17,196,000 |  |  |  |  |
*Gas collars are comprised of IF El Paso Permian (3%), IF HSC (64%), IF NGPL TXOK (3%), IF NNG Ventura (6%), IF Reliant N/S (16%), and IF TETCO STX (8%). NGL Contracts NGL Swaps
Contract Period |  | Volumes |  | Weighted-Average Contract Price
|  | (Bbls) |  | (per Bbl)
Second quarter 2014 |  | 1,096,000 |  |  | $ | 58.04 |
Third quarter 2014 |  | 960,000 |  |  | $ | 58.06 |
Fourth quarter 2014 |  | 861,000 |  |  | $ | 58.06 |
All NGL swaps* |  | 2,917,000 |  |  |
*NGL swaps are comprised of Oil Price Information System (“OPIS”) Mont Belvieu LDH Propane (72%) and OPIS Mont Belvieu NON-LDH Natural Gasoline (28%). Derivative Assets and Liabilities Fair Value The Company’s commodity derivatives are measured at fair value and are included in the accompanying balance sheets as derivative assets and liabilities. The fair value of the commodity derivative contracts was a net liability of $47.2 million and net asset of $21.5 million at March 31, 2014, and December 31, 2013, respectively. The following tables detail the fair value of derivatives recorded in the accompanying balance sheets, by category:
| As of March 31, 2014
| Derivative Assets |  | Derivative Liabilities
| Balance Sheet Classification |  | Fair Value |  | Balance Sheet Classification |  | Fair Value
| (in thousands)
Commodity contracts | Current assets |  | $ | 7,450 |  |  | Current liabilities |  | $ | 60,684 |
Commodity contracts | Noncurrent assets |  | 13,886 |  |  | Noncurrent liabilities |  | 7,885 |
Derivatives not designated as hedging instruments |  |  | $ | 21,336 |  |  |  |  | $ | 68,569 |
| As of December 31, 2013
| Derivative Assets |  | Derivative Liabilities
| Balance Sheet Classification |  | Fair Value |  | Balance Sheet Classification |  | Fair Value
| (in thousands)
Commodity contracts | Current assets |  | $ | 21,559 |  |  | Current liabilities |  | $ | 26,380 |
Commodity contracts | Noncurrent assets |  | 30,951 |  |  | Noncurrent liabilities |  | 4,640 |
Derivatives not designated as hedging instruments |  |  | $ | 52,510 |  |  |  |  | $ | 31,020 |
Offsetting of Derivative Assets and Liabilities As of March 31, 2014, and December 31, 2013, all derivative instruments held by the Company were subject to enforceable master netting arrangements held by various financial institutions. In general, the terms of the Company’s agreements provide for offsetting of amounts payable or receivable between it and the counterparty, at the election of both parties, for settlements that occur on the same date and in the same currency. The Company’s agreements also provide that in the event of an early termination, the counterparties have the right to offset amounts owed or owing under that and any other agreement with the same counterparty. The Company’s accounting policy is to not offset these positions in its accompanying balance sheets. The following table provides a reconciliation between the gross assets and liabilities reflected on the accompanying balance sheets and the potential effects of master netting arrangements on the fair value of the Company’s derivative contracts:
|  | Derivative Assets |  | Derivative Liabilities
|  | As of |  | As of
Offsetting of Derivative Assets and Liabilities |  | March 31, 2014 |  | December 31, 2013 |  | March 31, 2014 |  | December 31, 2013
|  | (in thousands)
Gross amounts presented in the accompanying balance sheets |  | $ | 21,336 |  |  | $ | 52,510 |  |  | $ | (68,569 | ) |  | $ | (31,020 | )
Amounts not offset in the accompanying balance sheets |  | (21,336 | ) |  | (30,652 | ) |  | 21,336 |  |  | 30,652 |
Net amounts |  | $ | — |  |  | $ | 21,858 |  |  | $ | (47,233 | ) |  | $ | (368 | )
The following table summarizes the components of the derivative loss presented in the accompanying statements of operations:
| For the Three Months Ended March 31,
| 2014 |  | 2013
| (in thousands)
Derivative cash settlement loss (gain): |  |  |
Oil contracts | $ | 6,758 |  |  | $ | 277 |
Gas contracts | 13,404 |  |  | (9,824 | )
NGL contracts | 8,778 |  |  | (2,245 | )
Total derivative cash settlement loss (gain) (1) | 28,940 |  |  | (11,792 | )
Derivative loss (gain): |  |  |
Oil contracts | 25,192 |  |  | 3,789 |
Gas contracts | 46,057 |  |  | 40,069 |
NGL contracts | (2,527 | ) |  | (1,494 | )
Total derivative loss (2) | $ | 97,662 |  |  | $ | 30,572 |
____________________________________________
(1) | Total derivative cash settlement loss (gain) is reported in the derivative cash settlement (loss) gain line item on the condensed consolidated statements of cash flows within net cash provided by operating activities.
(2) | Total derivative loss is reported in the derivative loss line item on the condensed consolidated statements of cash flows within cash provided by operating activities.
Credit Related Contingent Features As of March 31, 2014, and through the filing date of this report, all of the Company’s derivative counterparties were members of the Company’s credit facility lender group. The Company’s obligations under its derivative contracts are secured by liens on at least 75 percent of the Company’s proved oil and gas properties.

X
- Details
Name: | us-gaap_DerivativeInstrumentsAndHedgingActivitiesDisclosureAbstract
Namespace Prefix: | us-gaap_
Data Type: | xbrli:stringItemType
Balance Type: | na
Period Type: | duration

X
- Definition The entire disclosure for derivative instruments and hedging activities including, but not limited to, risk management strategies, non-hedging derivative instruments, assets, liabilities, revenue and expenses, and methodologies and assumptions used in determining the amounts. + References Reference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 815 -SubTopic 30 -Section 50 -Paragraph 1 -URI http://asc.fasb.org/extlink&oid=7668309&loc=d3e80748-113994 Reference 2: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 815 -SubTopic 10 -Section 50 -Paragraph 3 -URI http://asc.fasb.org/extlink&oid=7476318&loc=d3e41635-113959 Reference 3: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 815 -SubTopic 10 -Section 50 -Paragraph 4K -URI http://asc.fasb.org/extlink&oid=7476318&loc=SL5708775-113959 Reference 4: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 815 -SubTopic 25 -Section 50 -Paragraph 1 -URI http://asc.fasb.org/extlink&oid=6886632&loc=d3e76258-113986 Reference 5: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 815 -SubTopic 10 -Section 50 -Paragraph 4A -URI http://asc.fasb.org/extlink&oid=7476318&loc=SL5618551-113959 Reference 6: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 815 -SubTopic 30 -Section 45 -Paragraph 1 -URI http://asc.fasb.org/extlink&oid=6441202&loc=d3e80720-113993 Reference 7: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 235 -SubTopic 10 -Section S99 -Paragraph 1 -Subparagraph (SX 210.4-08.(n)) -URI http://asc.fasb.org/extlink&oid=26873400&loc=d3e23780-122690 Reference 8: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 815 -SubTopic 10 -Section 50 -Paragraph 4H -URI http://asc.fasb.org/extlink&oid=7476318&loc=SL5624258-113959 Reference 9: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 815 -SubTopic 10 -Section 50 -Paragraph 4B -URI http://asc.fasb.org/extlink&oid=7476318&loc=SL5624163-113959 Reference 10: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 815 -SubTopic 10 -Section 50 -Paragraph 4E -URI http://asc.fasb.org/extlink&oid=7476318&loc=SL5624181-113959 Reference 11: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 815 -SubTopic 10 -Section 50 -Paragraph 4J -URI http://asc.fasb.org/extlink&oid=7476318&loc=SL5708773-113959 Reference 12: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 815 -SubTopic 30 -Section 50 -Paragraph 2 -URI http://asc.fasb.org/extlink&oid=7668309&loc=d3e80784-113994 Reference 13: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 815 -SubTopic 10 -Section 50 -Paragraph 2 -URI http://asc.fasb.org/extlink&oid=7476318&loc=d3e41620-113959 Reference 14: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 815 -SubTopic 10 -Section 50 -Paragraph 4D -URI http://asc.fasb.org/extlink&oid=7476318&loc=SL5624177-113959 Reference 15: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 815 -SubTopic 10 -Section 50 -Paragraph 1A -URI http://asc.fasb.org/extlink&oid=7476318&loc=SL5579245-113959 Reference 16: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 815 -SubTopic 10 -Section 50 -Paragraph 1B -URI http://asc.fasb.org/extlink&oid=7476318&loc=SL5580258-113959 Reference 17: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 815 -SubTopic 10 -Section 50 -Paragraph 1 -URI http://asc.fasb.org/extlink&oid=7476318&loc=SL5579240-113959 Reference 18: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 815 -SubTopic 10 -Section 50 -Paragraph 5 -URI http://asc.fasb.org/extlink&oid=7476318&loc=d3e41641-113959 Reference 19: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 815 -SubTopic 10 -Section 50 -Paragraph 4 -URI http://asc.fasb.org/extlink&oid=7476318&loc=d3e41638-113959 Reference 20: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 815 -SubTopic 10 -Section 50 -Paragraph 4C -URI http://asc.fasb.org/extlink&oid=7476318&loc=SL5624171-113959 + Details
Name: | us-gaap_DerivativeInstrumentsAndHedgingActivitiesDisclosureTextBlock
Namespace Prefix: | us-gaap_
Data Type: | nonnum:textBlockItemType
Balance Type: | na
Period Type: | duration