2. Revenue Recognition

Revenues from the sale of oil, NGLs, and gas are recognized as the product is delivered to our customers’ custody transfer points and collectability is reasonably assured. We fulfill the performance obligations under our customer contracts through daily delivery of oil, NGLs and gas to our customers’ custody transfer points and revenues are recorded on a monthly basis. The prices received for oil, NGLs and natural gas sales under our contracts are generally derived from stated market prices which are then adjusted to reflect deductions including transportation, fractionation and processing. As a result, our revenues from the sale of oil, natural gas and NGLs will decrease if market prices decline. The sales of oil, NGLs and gas as presented on the Consolidated Statements of Operations represent the Company’s share of revenues net of royalties and excluding revenue interests owned by others. When selling oil, NGLs and gas on behalf of royalty owners or working interest owners, the Company is acting as an agent and thus reports the revenue on a net basis. To the extent actual volumes and prices of oil and natural gas sales are unavailable for a given reporting period because of timing or information not received from third parties, the expected sales volumes and prices for those properties are estimated and recorded.

The following table presents our disaggregated revenue by major source for the three and nine months ended September 30, 2018, and 2017 (in thousands).

	Three Months Ended					Nine Months Ended
	September 30,					September 30,
	2018			2017		2018			2017
Revenues (in thousands):
Oil	$	18,160		$	12,464	$	52,547		$	38,666
NGLs		10,690			7,093		26,874			19,172
Gas		3,797			6,051		12,262			19,094
Total revenue from contracts with customers		32,647			25,608		91,683			76,932
Commodity derivatives designated as cash flow hedges		(85	)		—		(23	)		—
Total oil, NGLs and gas sales	$	32,562		$	25,608	$	91,660		$	76,932