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Derivatives | 12 Months Ended
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Dec. 31, 2021
Derivative Instruments and Hedging Activities Disclosure [Abstract] |
Derivatives | Derivatives In the normal course of business, we are exposed to certain risks including changes in the prices of oil, natural gas and NGLs which may impact the cash flows associated with the sale of our future oil and natural gas production. We enter into derivative contracts with lenders under our revolving credit facilities that consist of either a single derivative instrument or a combination of instruments to manage our exposure to these risks. As of December 31, 2021, our commodity derivative instruments consisted of fixed price swaps and collars which are described below: Fixed Price and Basis Swaps: Fixed price swaps receive a fixed price and pay a floating market price to counterparty on the notional amount. Our basis swaps fix the basis differentials between the index price at which we sell our production as compared to the index price used in the basis swap. Under a swap contract, we will receive payment if the settlement price is less than the fixed price and would be required to make a payment to the counterparty if the settlement price is greater than the fixed price. Collars: Collars provide a minimum and maximum price on a notional amount of sales volume. Under a collar, we will receive payment if the settlement price is less than the minimum price of the range and make a payment to the counterparty if the settlement price is greater than the maximum price of the range. We would not be required to make a payment or receive payment if the settlement price falls within the range. The following table details our net volume positions by commodity as of December 31, 2021:
Production Period |  | Volumes |  | Weighted Average Fixed Price |  | Fair Value
|  | (in thousands) |  |  |  |  |  | (in thousands)
Crude oil swaps (Bbls): |  |  |  |  |  |  |  |
WTI |  |  |  |  |  |  |  |
2022 |  | 10,464 |  |  | $60.63 |  | $ | (121,508) |
2023 |  | 7,627 |  |  | $58.50 |  | (59,395) |
2024 |  | 2,975 |  |  | $57.35 |  | (16,542) |
Brent |  |  |  |  |  |  |  |
2022 |  | 500 |  |  | $56.36 |  | (9,258) |
2023 |  | 527 |  |  | $52.52 |  | (9,103) |
2024 |  | 189 |  |  | $63.71 |  | (766) |
Natural gas swaps (MMBtu): |  |  |  |  |  |  |  |
2022 |  | 84,527 |  |  | $2.77 |  | (76,861) |
2023 |  | 56,728 |  |  | $2.54 |  | (47,722) |
2024 |  | 454 |  |  | $2.94 |  | (82) |
NGL swaps (Bbls): |  |  |  |  |  |  |  |
2022 |  | 2,983 |  |  | $22.23 |  | (38,596) |
Crude oil basis swaps (Bbls): |  |  |  |  |  |  |  |
2022 |  | 5,843 |  |  | $(0.11) |  | (4,403) |
Natural gas basis swaps (MMBtu): |  |  |  |  |  |  |  |
2022 |  | 26,061 |  |  | $(0.17) |  | (3,243) |
CMA roll swaps (Bbls): |  |  |  |  |  |  |  |
2022 |  | 1,468 |  |  | $1.08 |  | 563 |
Natural gas collars (MMBtu): |  |  |  |  |  |  |  |
2022 |  | 510 |  |  | $3.00 | - | $3.41 |  | (220) |
2023 |  | 550 |  |  | $2.63 | - | $3.01 |  | (469) |
2024 |  | 9,150 |  |  | $3.00 |  | $3.87 |  | 1,187 |
Total |  |  |  |  |  |  |  | $ | (386,418) |
We have variable rate debt outstanding, which is subject to interest rate risk based on volatility in underlying interest rates. As of December 31, 2020, the fair value of our pay-fixed, receive-variable interest rate swaps was an unrealized loss of $7.0 million. Our interest rate swaps matured in 2021. We use derivative commodity instruments and enter into swap contracts which are governed by International Swaps and Derivatives Association master agreements. The following table shows the effects of master netting arrangements on the fair value of our derivative contracts at December 31, 2021 and 2020:
| Gross Fair Value |  | Effect of Counterparty Netting |  | Net Carrying Value
| (in thousands)
December 31, 2021 |  |  |  |  |
Assets: |  |  |  |  |
Derivative assets – current | $ | 2,983 |  |  | $ | (2,983) |  |  | $ | — |
Derivative assets – noncurrent | 4,834 |  |  | (4,255) |  |  | 579 |
Total assets | $ | 7,817 |  |  | $ | (7,238) |  |  | $ | 579 |
Liabilities: |  |  |  |  |
Derivative liabilities – current | $ | (256,508) |  |  | $ | 2,983 |  |  | $ | (253,525) |
Derivative liabilities – noncurrent | (137,726) |  |  | 4,255 |  |  | (133,471) |
Total liabilities | $ | (394,234) |  |  | $ | 7,238 |  |  | $ | (386,996) |
| Gross Fair Value |  | Effect of Counterparty Netting |  | Net Carrying Value
| (in thousands)
December 31, 2020 |  |  |  |  |
Assets: |  |  |  |  |
Derivative assets – current | $ | 52,833 |  |  | $ | (21,907) |  |  | $ | 30,926 |
Derivative assets – noncurrent | 34,257 |  |  | (11,905) |  |  | 22,352 |
Total assets | $ | 87,090 |  |  | $ | (33,812) |  |  | $ | 53,278 |
Liabilities: |  |  |  |  |
Derivative liabilities – current | $ | (48,299) |  |  | $ | 21,907 |  |  | $ | (26,392) |
Derivative liabilities – noncurrent | (35,863) |  |  | 11,905 |  |  | (23,958) |
Total liabilities | $ | (84,162) |  |  | $ | 33,812 |  |  | $ | (50,350) |
The amount of gain (loss) recognized in gain (loss) on derivatives in our combined and consolidated statements of operations was as follows for the years ended December 31, 2021, 2020 and 2019:
| Years ended December 31,
| 2021 |  | 2020 |  | 2019
| (in thousands)
Derivatives not designated as hedging instruments: |  |  |  |  |
Realized gain (loss) on oil positions | $ | (180,572) |  |  | $ | 149,713 |  |  | $ | (44,265) |
Realized loss on early settlement of certain oil positions | (198,688) |  |  | — |  |  | — |
Realized gain (loss) on natural gas positions | (80,253) |  |  | 32,638 |  |  | 4,245 |
Realized gain (loss) on NGL positions | (68,766) |  |  | 14,458 |  |  | 13,033 |
Realized gain (loss) on interest hedges | (7,373) |  |  | (12,435) |  |  | (2,189) |
Total realized gain (loss) | (535,652) |  |  | 184,374 |  |  | (29,176) |
Unrealized gain (loss) on commodity hedges | (337,715) |  |  | 8,836 |  |  | (94,766) |
Unrealized gain (loss) on interest hedges | 7,347 |  |  | 2,074 |  |  | (3,260) |
Total unrealized gain (loss) | (330,368) |  |  | 10,910 |  |  | (98,026) |
Total gain (loss) on derivatives | $ | (866,020) |  |  | $ | 195,284 |  |  | $ | (127,202) |
During the year ended December 31, 2021, we settled certain of our outstanding derivative oil commodity contracts for open positions associated with calendar years 2022 and 2023. Subsequent to the settlement, we entered into new commodity derivative contracts at prevailing market prices. See NOTE 6 – Fair Value Measurements.

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- 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://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 815 -URI http://asc.fasb.org/topic&trid=2229140 Reference 2: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 815 -SubTopic 40 -Section 50 -Paragraph 5 -Subparagraph (f) -URI http://asc.fasb.org/extlink&oid=123477628&loc=d3e90205-114008 + Details
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