Document_and_Entity_Informatio
Document and Entity Information Document | 9 Months Ended | |
Sep. 30, 2013 | Nov. 05, 2013 | |
Entity Information [Line Items] | ' | ' |
Entity Registrant Name | 'LEGACY RESERVES LP | ' |
Entity Central Index Key | '0001358831 | ' |
Current Fiscal Year End Date | '--12-31 | ' |
Entity Filer Category | 'Large Accelerated Filer | ' |
Document Type | '10-Q | ' |
Document Period End Date | 30-Sep-13 | ' |
Document Fiscal Year Focus | '2013 | ' |
Document Fiscal Period Focus | 'Q3 | ' |
Amendment Flag | 'false | ' |
Entity Common Stock, Shares Outstanding | ' | 57,513,535 |
Condensed_Consolidated_Balance
Condensed Consolidated Balance Sheets (USD $) | Sep. 30, 2013 | Dec. 31, 2012 |
In Thousands, unless otherwise specified | ||
Current assets: | ' | ' |
Cash and cash equivalents | $4,053 | $3,509 |
Accounts receivable, net: | ' | ' |
Oil and natural gas | 54,039 | 37,547 |
Joint interest owners | 14,546 | 27,851 |
Other | 435 | 551 |
Fair value of derivatives (Notes 6 and 7) | 2,765 | 15,158 |
Prepaid expenses and other current assets | 4,335 | 3,294 |
Total current assets | 80,173 | 87,910 |
Oil and natural gas properties, at cost: | ' | ' |
Proved oil and natural gas properties using the successful efforts method of accounting | 2,220,213 | 2,078,961 |
Unproved properties | 70,849 | 65,968 |
Accumulated depletion, depreciation, amortization and impairment | -696,391 | -573,003 |
Total assets | 1,594,671 | 1,571,926 |
Other property and equipment, net of accumulated depreciation and amortization of $5,622 and $4,618, respectively | 3,688 | 2,646 |
Deposits on pending acquisitions | 902 | 0 |
Operating rights, net of amortization of $3,901 and $3,531, respectively | 3,116 | 3,486 |
Fair value of derivatives (Notes 6 and 7) | 19,211 | 15,834 |
Other assets, net of amortization of $9,529 and $7,909, respectively | 18,499 | 7,804 |
Investments in equity method investees | 4,122 | 393 |
Total assets | 1,724,382 | 1,689,999 |
Current liabilities: | ' | ' |
Accounts payable | 6,058 | 1,822 |
Accrued oil and natural gas liabilities (Note 1) | 73,182 | 50,162 |
Fair value of derivatives (Notes 6 and 7) | 14,124 | 10,801 |
Asset retirement obligation (Note 8) | 2,338 | 29,501 |
Other (Note 10) | 19,076 | 11,437 |
Total current liabilities | 114,778 | 103,723 |
Long-term debt (Note 2) | 844,307 | 775,838 |
Asset retirement obligation (Note 8) | 170,768 | 132,682 |
Fair value of derivatives (Notes 6 and 7) | 2,827 | 5,590 |
Other long-term liabilities | 1,780 | 1,886 |
Total liabilities | 1,134,460 | 1,019,719 |
Commitments and contingencies (Note 5) | ' | ' |
Unitholders' equity: | ' | ' |
Limited partners' equity - 57,279,449 and 57,038,942 units issued and outstanding at September 30, 2013 and December 31, 2012, respectively | 589,833 | 670,183 |
General partner's equity (approximately 0.03%) | 89 | 97 |
Total unitholders' equity | 589,922 | 670,280 |
Total liabilities and unitholders' equity | $1,724,382 | $1,689,999 |
Condensed_Consolidated_Balance1
Condensed Consolidated Balance Sheets (Parenthetical) (USD $) | Sep. 30, 2013 | Dec. 31, 2012 |
In Thousands, except Share data, unless otherwise specified | ||
Statement of Financial Position [Abstract] | ' | ' |
Other property and equipment, accumulated depreciation and amortization | $5,622 | $4,618 |
Operating rights, amortization | 3,901 | 3,531 |
Other assets, amortization | $9,529 | $7,909 |
Units issued (in shares) | 57,279,449 | 57,038,942 |
Units outstanding (in shares) | 57,279,449 | 57,038,942 |
General partner's equity | 0.03% | 0.03% |
Condensed_Consolidated_Stateme
Condensed Consolidated Statements of Operations (USD $) | 3 Months Ended | 9 Months Ended | ||
In Thousands, except Per Share data, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 |
Revenues: | ' | ' | ' | ' |
Oil sales | $116,396 | $70,173 | $304,606 | $212,097 |
Natural gas liquids (NGL) sales | 3,686 | 3,492 | 10,188 | 10,742 |
Natural gas sales | 16,101 | 10,531 | 48,654 | 33,166 |
Total revenues | 136,183 | 84,196 | 363,448 | 256,005 |
Expenses: | ' | ' | ' | ' |
Oil and natural gas production | 39,701 | 30,728 | 112,236 | 82,023 |
Production and other taxes | 8,385 | 5,137 | 22,083 | 15,040 |
General and administrative | 7,933 | 6,993 | 21,279 | 18,604 |
Depletion, depreciation, amortization and accretion | 37,717 | 24,833 | 118,482 | 73,042 |
Impairment of long-lived assets | 835 | 7,277 | 23,352 | 22,556 |
(Gain) loss on disposal of assets | 758 | 260 | 493 | -3,064 |
Total expenses | 95,329 | 75,228 | 297,925 | 208,201 |
Operating income | 40,854 | 8,968 | 65,523 | 47,804 |
Other income (expense): | ' | ' | ' | ' |
Interest income | 227 | 3 | 568 | 11 |
Interest expense (Notes 2, 6 and 7) | -14,206 | -5,285 | -36,104 | -14,256 |
Equity in income of equity method investees | 172 | 30 | 357 | 87 |
Net gains (losses) on commodity derivatives (Notes 6 and 7) | -30,424 | -27,177 | -18,098 | 34,084 |
Other | -16 | -51 | -11 | -87 |
Income (loss) before income taxes | -3,393 | -23,512 | 12,235 | 67,643 |
Income tax expense | -29 | -54 | -608 | -878 |
Net income (loss) | ($3,422) | ($23,566) | $11,627 | $66,765 |
Income (loss) per unit - basic and diluted (Note 9) | ($0.06) | ($0.49) | $0.20 | $1.40 |
Weighted average number of units used in computing net income (loss) per unit - | ' | ' | ' | ' |
Basic (in shares) | 57,275 | 47,869 | 57,200 | 47,840 |
Diluted (in shares) | 57,275 | 47,869 | 57,295 | 47,840 |
Condensed_Consolidated_Stateme1
Condensed Consolidated Statements of Unitholders' Equity (USD $) | Total | Limited Partner | General Partner |
In Thousands, unless otherwise specified | |||
Partners' Capital Beginning Balance at Dec. 31, 2012 | $670,280 | $670,183 | $97 |
Partners' Capital Account, Units Beginning Balance (in shares) at Dec. 31, 2012 | ' | 57,039 | ' |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ' | ' | ' |
Units issued to Legacy Board of Directors for services (in shares) | ' | 18 | ' |
Units issued to Legacy Board of Directors for services | 509 | 509 | ' |
Unit-based compensation | 2,549 | 2,549 | ' |
Vesting of restricted units (in shares) | ' | 69 | ' |
Offering costs associated with the issuance of units | -10 | -10 | ' |
Units issued in exchange for invesment in equity method investee (in shares) | ' | 153 | ' |
Units issued in exchange for invesment in equity method investee | 4,001 | 4,001 | ' |
Redemption of investment | -12 | ' | -12 |
Distributions to unitholders, $1.725 per unit | -99,022 | -99,022 | ' |
Net income | 11,627 | 11,623 | 4 |
Partners' Capital Ending Balance at Sep. 30, 2013 | $589,922 | $589,833 | $89 |
Partners' Capital Account, Units Ending Balance (in shares) at Sep. 30, 2013 | ' | 57,279 | ' |
Condensed_Consolidated_Stateme2
Condensed Consolidated Statements of Unitholders' Equity (Parenthetical) (USD $) | Sep. 30, 2013 |
Statement of Stockholders' Equity [Abstract] | ' |
Distributions to unitholders (in dollars per share) | $1.73 |
Condensed_Consolidated_Stateme3
Condensed Consolidated Statement of Cash Flows (USD $) | 9 Months Ended | |
In Thousands, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 |
Cash flows from operating activities: | ' | ' |
Net income | $11,627 | $66,765 |
Adjustments to reconcile net income to net cash provided by operating activities: | ' | ' |
Depletion, depreciation, amortization and accretion | 118,482 | 73,042 |
Amortization of debt discount and issuance costs | 2,826 | 1,143 |
Impairment of long-lived assets | 23,352 | 22,556 |
(Gains) losses on derivatives | 14,241 | -35,141 |
Equity in income of equity method investees | -357 | -87 |
Unit-based compensation | 1,978 | 333 |
(Gain) loss on disposal of assets | 493 | -3,064 |
Changes in assets and liabilities: | ' | ' |
(Increase) decrease in accounts receivable, oil and natural gas | -16,492 | 328 |
(Increase) decrease in accounts receivable, other | 13,305 | -3,023 |
(Increase) decrease in accounts receivable, other | 116 | -190 |
Increase in other assets | -315 | -619 |
Increase in accounts payable | 4,236 | 2,938 |
Increase in accrued oil and natural gas liabilities | 23,020 | 6,911 |
Increase (decrease) in other liabilities | 4,989 | -2,453 |
Total adjustments | 189,874 | 62,674 |
Net cash provided by operating activities | 201,501 | 129,439 |
Cash flows from investing activities: | ' | ' |
Investment in oil and natural gas properties | -160,836 | -164,322 |
Increase in deposits on pending acquisitions | 902 | 930 |
Proceeds from (payments related to) sale of assets | -173 | 9,102 |
Investment in other equipment | -2,046 | -1,014 |
Goodwill | 0 | -7,770 |
Net cash settlements on commodity derivatives | -4,666 | 2,018 |
Distribution from equity method investee | 631 | 0 |
Net cash used in investing activities | -167,992 | -162,916 |
Cash flows from financing activities: | ' | ' |
Proceeds from long-term debt | 664,263 | 335,000 |
Payments of long-term debt | -597,000 | -220,000 |
Payments of debt issuance costs | -1,184 | -462 |
Offering costs associated with the issuance of units | -10 | -2 |
Distributions to unitholders | -99,022 | -79,844 |
Redemption of investment | -12 | 0 |
Net cash provided by (used in) financing activities | -32,965 | 34,692 |
Net increase in cash and cash equivalents | 544 | 1,215 |
Cash and cash equivalents, beginning of period | 3,509 | 3,151 |
Cash and cash equivalents, end of period | 4,053 | 4,366 |
Non-cash investing and financing activities: | ' | ' |
Asset retirement obligations associated with property acquisitions | 9,853 | 6,036 |
Units issued in exchange for equity method investee | 4,001 | 0 |
Note receivable received in exchange for the sale of oil and natural gas properties | $11,857 | ' |
Summary_of_Significant_Account
Summary of Significant Accounting Policies | 9 Months Ended | |||||||
Sep. 30, 2013 | ||||||||
Accounting Policies [Abstract] | ' | |||||||
Summary of Significant Accounting Policies | ' | |||||||
Summary of Significant Accounting Policies | ||||||||
(a) | Organization, Basis of Presentation and Description of Business | |||||||
Legacy Reserves LP and its affiliated entities are referred to as Legacy, LRLP or the Partnership in these financial statements. | ||||||||
The accompanying condensed consolidated financial statements have been prepared on the accrual basis of accounting whereby revenues are recognized when earned, and expenses are recognized when incurred. These condensed consolidated financial statements as of September 30, 2013 and for the three and nine months ended September 30, 2013 and 2012 are unaudited. In the opinion of management, such financial statements include the adjustments and accruals, all of which are of a normal recurring nature, which are necessary for a fair presentation of the results for the interim periods. These interim results are not necessarily indicative of results for a full year. | ||||||||
Certain information and footnote disclosures normally included in the financial statements prepared in accordance with generally accepted accounting principles in the United States (“GAAP”) have been condensed or omitted in this Form 10-Q pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”). These condensed consolidated financial statements should be read in connection with the consolidated financial statements and notes thereto included in the Partnership’s Annual Report on Form 10-K for the year ended December 31, 2012. | ||||||||
LRLP, a Delaware limited partnership, was formed by its general partner, Legacy Reserves GP, LLC (“LRGPLLC”), on October 26, 2005 to own and operate oil and natural gas properties. LRGPLLC is a Delaware limited liability company formed on October 26, 2005, and owns an approximate 0.03% general partner interest in LRLP. | ||||||||
Significant information regarding rights of the limited partners includes the following: | ||||||||
•Right to receive, within 45 days after the end of each quarter, distributions of available cash, if distributions are declared. | ||||||||
•No limited partner shall have any management power over LRLP’s business and affairs; the general partner shall conduct, direct and manage LRLP’s activities. | ||||||||
•The general partner may be removed if such removal is approved by the unitholders holding at least 66 2/3 percent of the outstanding units, including units held by LRLP’s general partner and its affiliates, provided that a unit majority has elected a successor general partner. | ||||||||
•Right to receive information reasonably required for tax reporting purposes within 90 days after the close of the calendar year. | ||||||||
In the event of liquidation, all property and cash in excess of that required to discharge all liabilities will be distributed to the unitholders and LRLP’s general partner in proportion to their capital account balances, as adjusted to reflect any gain or loss upon the sale or other disposition of Legacy’s assets in liquidation. | ||||||||
Legacy owns and operates oil and natural gas producing properties located primarily in the Permian Basin (West Texas and Southeast New Mexico), Mid-Continent and Rocky Mountain regions of the United States. Legacy has acquired oil and natural gas producing properties and undrilled leaseholds. | ||||||||
(b) | Accrued Oil and Natural Gas Liabilities | |||||||
Below are the components of accrued oil and natural gas liabilities as of September 30, 2013 and December 31, 2012. | ||||||||
September 30, | December 31, | |||||||
2013 | 2012 | |||||||
(In thousands) | ||||||||
Revenue payable to joint interest owners | $ | 24,996 | $ | 24,903 | ||||
Accrued lease operating expense | 12,334 | 8,507 | ||||||
Accrued capital expenditures | 9,672 | 5,213 | ||||||
Accrued ad valorem tax | 13,677 | 4,806 | ||||||
Other | 12,503 | 6,733 | ||||||
$ | 73,182 | $ | 50,162 | |||||
LongTerm_Debt
Long-Term Debt | 9 Months Ended | ||||||||
Sep. 30, 2013 | |||||||||
Debt Disclosure [Abstract] | ' | ||||||||
Long-Term Debt | ' | ||||||||
Long-Term Debt | |||||||||
Long-term debt consists of the following as of September 30, 2013 and December 31, 2012: | |||||||||
September 30, | December 31, | ||||||||
2013 | 2012 | ||||||||
(In thousands) | |||||||||
Credit Facility due 2016 | $ | 314,000 | $ | 488,000 | |||||
8% Senior Notes due 2020 | 300,000 | 300,000 | |||||||
6.625% Senior Notes due 2021 | 250,000 | — | |||||||
864,000 | 788,000 | ||||||||
Unamortized discount on Senior Notes | (19,693 | ) | (12,162 | ) | |||||
Total Long-Term Debt | $ | 844,307 | $ | 775,838 | |||||
Credit Facility | |||||||||
On March 10, 2011, Legacy entered into an amended and restated five-year $1 billion secured revolving credit facility with BNP Paribas as administrative agent (as amended, the "Credit Agreement"). Effective April 20, 2012, Wells Fargo Bank, National Association ("Wells Fargo"), replaced BNP Paribas as administrative agent as a result of the sale of BNP Paribas' energy lending practice to Wells Fargo. Borrowings under the Credit Agreement mature on March 10, 2016. The amount available for borrowing at any one time is limited to the borrowing base with a $2 million sub-limit for letters of credit. In conjunction with Legacy's issuance of 6.625% Senior Notes due 2021 (the "2021 Senior Notes"), on May 28, 2013, the borrowing base under the Credit Agreement was automatically decreased to $737.5 million. The borrowing base is subject to semi-annual redeterminations on or around April 1 and October 1 of each year. Additionally, either Legacy or the lenders may, once during each calendar year, elect to redetermine the borrowing base between scheduled redeterminations. Legacy also has the right, once during each calendar year, to request the redetermination of the borrowing base upon the proposed acquisition of oil and natural gas properties where the purchase price is greater than 10% of the borrowing base. Under the Credit Agreement, interest on debt outstanding is charged based on Legacy's selection of a one-, two-, three- or six-month LIBOR rate plus 1.75% to 2.75%, or the alternate base rate ("ABR") which equals the highest of the prime rate, the Federal funds effective rate plus 0.50% or one-month LIBOR plus 1.00%, plus an applicable margin from 0.75% to 1.75% per annum, determined by the percentage of the borrowing base then in effect that is drawn. | |||||||||
The Credit Agreement permits Legacy to issue up to $750 million in aggregate principal amount of senior notes or new debt issued to refinance senior notes, subject to specified conditions in the Credit Agreement, which include that upon the issuance of such senior notes or new debt, the borrowing base will be reduced by an amount equal to (i) in the case of senior notes, 25% of the stated principal amount of the senior notes and (ii) in the case of new debt, 25% of the portion of the new debt that exceeds the original principal amount of the senior notes. As of November 5, 2013, Legacy had $550 million in aggregate principal amount of senior notes outstanding, leaving $200 million available for incremental new issuance subject to the provisions above. | |||||||||
As of September 30, 2013, Legacy had outstanding borrowings of $314 million at a weighted-average interest rate of 2.21% and approximately $423.4 million of availability remaining under the Credit Agreement. For the nine-month period ended September 30, 2013, Legacy paid in cash $9.1 million of interest expense on the Credit Agreement. Legacy’s Credit Agreement also contains covenants that, among other things, require us to maintain specified ratios or conditions as follows: | |||||||||
• | total debt as of the last day of the most recent quarter to EBITDA (as defined in the Credit Agreement) over the last four quarters of not more than 4.0 to 1.0; and | ||||||||
• | consolidated current assets, as of the last day of the most recent quarter and including the unused amount of the total commitments, to consolidated current liabilities as of the last day of the most recent quarter of not less than 1.0 to 1.0, excluding non-cash assets and liabilities under Accounting Standards Codification ("ASC") 815, which includes the current portion of oil, natural gas and interest rate derivatives. | ||||||||
At September 30, 2013, Legacy was in compliance with all covenants of the Credit Agreement. | |||||||||
8% Senior Notes Due 2020 | |||||||||
On December 4, 2012, Legacy and its 100% owned subsidiary Legacy Reserves Finance Corporation completed a private placement offering to eligible purchasers of an aggregate principal amount of $300 million of our 8% Senior Notes due 2020 (the "2020 Senior Notes"). The 2020 Senior Notes were issued at 97.848% of par. Legacy received approximately $286.7 million of net cash proceeds, after deducting the discount to initial purchasers and offering expenses payable by Legacy. During the nine months ended September 30, 2013, Legacy amortized $1.0 million of this discount. | |||||||||
Legacy will have the option to redeem the 2020 Senior Notes, in whole or in part, at any time on or after December 1, 2016, at the specified redemption prices set forth below together with any accrued and unpaid interest, if any, to the date of redemption if redeemed during the twelve-month period beginning on December 1 of the years indicated below. | |||||||||
Year | Percentage | ||||||||
2016 | 104 | % | |||||||
2017 | 102 | % | |||||||
2018 and thereafter | 100 | % | |||||||
Prior to December 1, 2016, Legacy may redeem all or any part of the 2020 Senior Notes at the “make-whole” redemption price as defined in the indenture. In addition, prior to December 1, 2015, Legacy may at its option, redeem up to 35% of the aggregate principal amount of the 2020 Senior Notes at the redemption price of 108% with the net proceeds of a public or private equity offering. Legacy may be required to offer to repurchase the 2020 Senior Notes at a purchase price of 101% of the principal amount, plus accrued and unpaid interest, if any, to the redemption date, in the event of a change of control as defined by the indenture. Legacy's and Legacy Reserves Finance Corporation's obligations under the 2020 Senior Notes are guaranteed by its 100% owned subsidiaries Legacy Reserves Operating GP, LLC, Legacy Reserves Operating LP and Legacy Reserves Services, Inc., which constitute all of Legacy's wholly-owned subsidiaries other than Legacy Reserves Finance Corporation. In the future, the guarantees may be released or terminated under the following circumstances: (i) in connection with any sale or other disposition of all or substantially all of the properties of the guarantor; (ii) in connection with any sale or other disposition of sufficient capital stock of the guarantor so that it no longer qualifies as our Restricted Subsidiary (as defined in the indenture); (iii) if designated to be an unrestricted subsidiary; (iv) upon legal defeasance, covenant defeasance or satisfaction and discharge of the indenture; (v) upon the liquidation or dissolution of the guarantor provided no default or event of default has occurred or is occurring; (vi) at such time the guarantor does not have outstanding guarantees of its, or any other guarantor's, other, debt; or (vii) upon merging into, or transferring all of its properties to Legacy or another guarantor and ceasing to exist. Refer to Note 11 - Subsidiary Guarantors for further details on Legacy's guarantors. | |||||||||
The indenture governing the 2020 Senior Notes limits Legacy's ability and the ability of certain of its subsidiaries to (i) sell assets; (ii) pay distributions on, repurchase or redeem equity interests or purchase or redeem Legacy's subordinated debt, provided that such subsidiaries may pay dividends to the holders of their equity interests (including Legacy) and Legacy may pay distributions to the holders of its equity interests subject to the absence of certain defaults, the satisfaction of a fixed charge coverage ratio test and so long as the amount of such distributions does not exceed the sum of available cash (as defined in the partnership agreement) at Legacy, net proceeds from the sales of certain securities and return of or reductions to capital from restricted investments; (iii) make certain investments; (iv) incur or guarantee additional indebtedness or issue preferred units; (v) create or incur certain liens; (vi) enter into agreements that restrict distributions or other payments from certain of its subsidiaries to Legacy; (vii) consolidate, merge or transfer all or substantially all of Legacy's assets; (viii) engage in certain transactions with affiliates; (ix) create unrestricted subsidiaries; and (x) engage in certain business activities. These covenants are subject to a number of important exceptions and qualifications. If at any time when the 2020 Senior Notes are rated investment grade by each of Moody's Investors Service, Inc. and Standard & Poor's Ratings Services and no Default (as defined in the indenture) has occurred and is continuing, many of such covenants will terminate and Legacy and its subsidiaries will cease to be subject to such covenants. The indenture also includes customary events of default. The Partnership is in compliance with all financial and other covenants of the 2020 Senior Notes. | |||||||||
Interest is payable on June 1 and December 1 of each year. | |||||||||
6.625% Senior Notes Due 2021 | |||||||||
On May 28, 2013, Legacy and its 100% owned subsidiary Legacy Reserves Finance Corporation completed a private placement offering to eligible purchasers of an aggregate principal amount of $250 million of our 6.625% Senior Notes due 2021 (the "2021 Senior Notes"). The 2021 Senior Notes were issued at 98.405% of par. Legacy received approximately $240.7 million of net cash proceeds, after deducting the discount to initial purchasers and offering expenses payable by Legacy. During the nine months ended September 30, 2013, Legacy amortized $0.2 million of this discount. | |||||||||
Legacy will have the option to redeem the 2021 Senior Notes, in whole or in part, at any time on or after June 1, 2017, at the specified redemption prices set forth below together with any accrued and unpaid interest, if any, to the date of redemption if redeemed during the twelve-month period beginning on June 1 of the years indicated below. | |||||||||
Year | Percentage | ||||||||
2017 | 103.313 | % | |||||||
2018 | 101.656 | % | |||||||
2019 and thereafter | 100 | % | |||||||
Prior to June 1, 2017, Legacy may redeem all or any part of the 2021 Senior Notes at the “make-whole” redemption price as defined in the indenture. In addition, prior to June 1, 2016, Legacy may at its option, redeem up to 35% of the aggregate principal amount of the 2021 Senior Notes at the redemption price of 106.625% with the net proceeds of a public or private equity offering. Legacy may be required to offer to repurchase the 2021 Senior Notes at a purchase price of 101% of the principal amount, plus accrued and unpaid interest, if any, to the redemption date, in the event of a change of control as defined by the indenture. Legacy's and Legacy Reserves Finance Corporation's obligations under the 2021 Senior Notes are guaranteed by its 100% owned subsidiaries Legacy Reserves Operating GP, LLC, Legacy Reserves Operating LP and Legacy Reserves Services, Inc., which constitute all of Legacy's wholly-owned subsidiaries other than Legacy Reserves Finance Corporation. In the future, the guarantees may be released or terminated under the following circumstances: (i) in connection with any sale or other disposition of all or substantially all of the properties of the guarantor; (ii) in connection with any sale or other disposition of sufficient capital stock of the guarantor so that it no longer qualifies as our Restricted Subsidiary (as defined in the indenture); (iii) if designated to be an unrestricted subsidiary; (iv) upon legal defeasance, covenant defeasance or satisfaction and discharge of the indenture; (v) upon the liquidation or dissolution of the guarantor provided no default or event of default has occurred or is occurring; (vi) at such time the guarantor does not have outstanding guarantees of its, or any other guarantor's, other, debt; or (vii) upon merging into, or transferring all of its properties to Legacy or another guarantor and ceasing to exist. Refer to Note 11 - Subsidiary Guarantors for further details on Legacy's guarantors. | |||||||||
The indenture governing the 2021 Senior Notes limits Legacy's ability and the ability of certain of its subsidiaries to (i) sell assets; (ii) pay distributions on, repurchase or redeem equity interests or purchase or redeem Legacy's subordinated debt, provided that such subsidiaries may pay dividends to the holders of their equity interests (including Legacy) and Legacy may pay distributions to the holders of its equity interests subject to the absence of certain defaults, the satisfaction of a fixed charge coverage ratio test and so long as the amount of such distributions does not exceed the sum of available cash (as defined in the partnership agreement) at Legacy, net proceeds from the sales of certain securities and return of or reductions to capital from restricted investments; (iii) make certain investments; (iv) incur or guarantee additional indebtedness or issue preferred units; (v) create or incur certain liens; (vi) enter into agreements that restrict distributions or other payments from certain of its subsidiaries to Legacy; (vii) consolidate, merge or transfer all or substantially all of Legacy's assets; (viii) engage in certain transactions with affiliates; (ix) create unrestricted subsidiaries; and (x) engage in certain business activities. These covenants are subject to a number of important exceptions and qualifications. If at any time when the 2021 Senior Notes are rated investment grade by each of Moody's Investors Service, Inc. and Standard & Poor's Ratings Services and no Default (as defined in the indenture) has occurred and is continuing, many of such covenants will terminate and Legacy and its subsidiaries will cease to be subject to such covenants. The indenture also includes customary events of default. The Partnership is in compliance with all financial and other covenants of the 2021 Senior Notes. | |||||||||
Interest is payable on June 1 and December 1 of each year, beginning December 1, 2013. | |||||||||
Long-term debt consists of the following as of September 30, 2013 and December 31, 2012: | |||||||||
September 30, | December 31, | ||||||||
2013 | 2012 | ||||||||
(In thousands) | |||||||||
Credit Facility due 2016 | $ | 314,000 | $ | 488,000 | |||||
8% Senior Notes due 2020 | 300,000 | 300,000 | |||||||
6.625% Senior Notes due 2021 | 250,000 | — | |||||||
864,000 | 788,000 | ||||||||
Unamortized discount on Senior Notes | (19,693 | ) | (12,162 | ) | |||||
Total Long-Term Debt | $ | 844,307 | $ | 775,838 | |||||
Acquisitions
Acquisitions | 9 Months Ended | ||||||||
Sep. 30, 2013 | |||||||||
Business Combinations [Abstract] | ' | ||||||||
Acquisitions | ' | ||||||||
Acquisitions | |||||||||
COG 2012 Acquisition | |||||||||
On December 20, 2012, Legacy purchased certain oil and natural gas properties located primarily in the Permian Basin from COG Operating LLC and Concho Oil and Gas LLC, both wholly-owned subsidiaries of Concho Resources Inc., for a net cash purchase price of $502.6 million. The purchase price was financed with net proceeds from Legacy’s November 2012 public offering of units and the 2020 Senior Notes. The effective date of this purchase was October 1, 2012. The operating results from these COG 2012 Acquisition properties have been included from the closing date of their acquisition on December 20, 2012. | |||||||||
The allocation of the purchase price to the fair value of the acquired assets and liabilities assumed was as follows (in thousands): | |||||||||
Proved oil and natural gas properties including related equipment | $ | 495,897 | |||||||
Unproved properties | 37,994 | ||||||||
Total assets | 533,891 | ||||||||
Future abandonment costs | (31,274 | ) | |||||||
Fair value of net assets acquired | $ | 502,617 | |||||||
Pro Forma Operating Results | |||||||||
The following table reflects the unaudited pro forma results of operations as though the COG 2012 Acquisition had occurred on January 1, 2011. The pro forma amounts are not necessarily indicative of the results that may be reported in the future. | |||||||||
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||
2012 | 2012 | ||||||||
(In thousands) | |||||||||
Revenues | $ | 115,819 | $ | 369,601 | |||||
Net income (loss) | $ | (18,475 | ) | $ | 87,883 | ||||
Income (loss) per unit — basic and diluted | $ | (0.32 | ) | $ | 1.54 | ||||
Units used in computing income per unit: | |||||||||
Basic and Diluted | 57,039 | 57,010 | |||||||
The amounts of revenues and revenues in excess of direct operating expenses included in our consolidated statements of operations for the COG 2012 Acquisition are shown in the table that follows. Direct operating expenses include lease operating expenses and production and other taxes. | |||||||||
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||
2013 | 2013 | ||||||||
(In thousands) | |||||||||
Revenues | $ | 30,683 | $ | 86,548 | |||||
Excess of revenues over direct operating expenses | $ | 21,633 | $ | 59,128 | |||||
Related_Party_Transactions
Related Party Transactions | 9 Months Ended |
Sep. 30, 2013 | |
Related Party Transactions [Abstract] | ' |
Related Party Transactions | ' |
Related Party Transactions | |
Cary D. Brown, Chairman, President and Chief Executive Officer of Legacy's general partner, and Kyle A. McGraw, Director, Executive Vice President and Chief Development Officer of Legacy's general partner, own partnership interests in entities which, in turn, own a combined non-controlling 4.16% interest as limited partners in the partnership which owns the building that Legacy occupies. Monthly rent is $57,170, without respect to property taxes, insurance and operating expenses. The lease expires in September 2015. | |
During the year ended December 31, 2012, Legacy acquired a 5% working interest in approximately 129,428 acres of prospective Cline Shale acreage from FireWheel Energy, LLC ("FireWheel"), the operator of the properties, for $7.2 million. During the nine months ended September 30, 2013, Legacy acquired an additional 24,510 acres from Firewheel for $1.2 million. FireWheel is a private-equity funded oil and natural gas exploration company in which Alan Brown, son of Dale Brown, a director of Legacy, and brother of Cary D. Brown, is a principal. The interests acquired by Legacy were marketed to numerous industry participants and are governed by an industry standard Participation Agreement and Joint Operating Agreement. |
Commitments_and_Contingencies
Commitments and Contingencies | 9 Months Ended |
Sep. 30, 2013 | |
Commitments and Contingencies Disclosure [Abstract] | ' |
Commitments and Contingencies | ' |
Commitments and Contingencies | |
From time to time Legacy is a party to various legal proceedings arising in the ordinary course of business. While the outcome of lawsuits cannot be predicted with certainty, Legacy is not currently a party to any proceeding that it believes could have a potential material adverse effect on its financial condition, results of operations or cash flows. | |
Legacy is subject to numerous laws and regulations governing the discharge of materials into the environment or otherwise relating to environmental protection. To the extent laws are enacted or other governmental action is taken that restricts drilling or imposes environmental protection requirements that result in increased costs to the oil and natural gas industry in general, the business and prospects of Legacy could be adversely affected. | |
Legacy has employment agreements with its officers that specify that if the officer is terminated by Legacy for other than cause or following a change in control, the officer shall receive severance pay ranging from 24 to 36 months salary plus bonus and COBRA benefits, respectively. |
Fair_Value_Measurements
Fair Value Measurements | 9 Months Ended | ||||||||||||||||
Sep. 30, 2013 | |||||||||||||||||
Fair Value Disclosures [Abstract] | ' | ||||||||||||||||
Fair Value Measurements | ' | ||||||||||||||||
Fair Value Measurements | |||||||||||||||||
As defined in Financial Accounting Standards Board ("FASB") ASC 820-10, fair value is the price that would be received upon the sale of an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. ASC 820-10 requires disclosure that establishes a framework for measuring fair value and expands disclosure about fair value measurements. The statement requires fair value measurements be classified and disclosed in one of the following categories: | |||||||||||||||||
Level 1: | Unadjusted quoted prices in active markets that are accessible at the measurement date for identical, unrestricted assets or liabilities. Legacy considers active markets as those in which transactions for the assets or liabilities occur in sufficient frequency and volume to provide pricing information on an ongoing basis. | ||||||||||||||||
Level 2: | Quoted prices in markets that are not active, or inputs which are observable, either directly or indirectly, for substantially the full term of the asset or liability. This category includes those derivative instruments that Legacy values using observable market data. Substantially all of these inputs are observable in the marketplace throughout the term of the derivative instrument, can be derived from observable data, or are supported by observable levels at which transactions are executed in the marketplace. Instruments in this category include non-exchange traded derivatives such as over-the-counter commodity price swaps and interest rate swaps as well as long-term incentive plan liabilities calculated using the Black-Scholes model to estimate the fair value as of the measurement date. | ||||||||||||||||
Level 3: | Measured based on prices or valuation models that require inputs that are both significant to the fair value measurement and less observable from objective sources (i.e. supported by little or no market activity). Legacy’s valuation models are primarily industry standard models that consider various inputs including: (a) quoted forward prices for commodities, (b) time value, and (c) current market and contractual prices for the underlying instruments, as well as other relevant economic measures. Level 3 instruments primarily include derivative instruments, such as natural gas derivative swaps for those derivatives indexed to the West Texas Waha, ANR-Oklahoma and CIG indices, enhanced swaps, commodity collars and Midland-Cushing crude oil differential swaps. Although Legacy utilizes third party broker quotes to assess the reasonableness of its prices and valuation techniques, Legacy does not have sufficient corroborating evidence to support classifying these assets and liabilities as Level 2. | ||||||||||||||||
As required by ASC 820-10, financial assets and liabilities are classified based on the lowest level of input that is significant to the fair value measurement. Legacy’s assessment of the significance of a particular input to the fair value measurement requires judgment, and may affect the valuation of the fair value of assets and liabilities and their placement within the fair value hierarchy levels. | |||||||||||||||||
Fair Value on a Recurring Basis | |||||||||||||||||
The following table sets forth by level within the fair value hierarchy Legacy’s financial assets and liabilities that were accounted for at fair value on a recurring basis as of September 30, 2013: | |||||||||||||||||
Fair Value Measurements at September 30, 2013 Using | |||||||||||||||||
Quoted Prices in Active Markets for Identical Assets | Significant Other Observable Inputs | Significant Unobservable Inputs | Total Carrying Value as of | ||||||||||||||
Description | (Level 1) | (Level 2) | (Level 3) | September 30, 2013 | |||||||||||||
(In thousands) | |||||||||||||||||
LTIP liability (a) | $ | — | $ | (2,085 | ) | $ | — | $ | (2,085 | ) | |||||||
Oil and natural gas swaps | — | (12,360 | ) | 8,597 | (3,763 | ) | |||||||||||
Oil collars | — | — | 14,478 | 14,478 | |||||||||||||
Interest rate swaps | — | (5,690 | ) | — | (5,690 | ) | |||||||||||
Total | $ | — | $ | (20,135 | ) | $ | 23,075 | $ | 2,940 | ||||||||
(a) | See Note 10 for further discussion on unit-based compensation expenses and the related LTIP liability for certain grants accounted for under the liability method. | ||||||||||||||||
Legacy estimates the fair values of the swaps based on published forward commodity price curves for the underlying commodities as of the date of the estimate for those commodities for which published forward pricing is readily available. For those commodity derivatives for which forward commodity price curves are not readily available, Legacy estimates, with the assistance of third-party pricing experts, the forward curves as of the date of the estimate. Legacy estimates the option value of the contract floors and ceilings using an option pricing model which takes into account market volatility, market prices, contract parameters and discount rates based on published LIBOR rates and interest swap rates. Due to the lack of an active market for periods beyond one-month from the balance sheet date for our oil price differential swaps, Legacy has reviewed historical differential prices and known economic influences to estimate a reasonable forward curve of future pricing scenarios based upon these factors. Significant changes in the quoted forward prices for commodities and changes in market volatility generally lead to corresponding changes in the fair value measurement of our oil and natural gas derivative contracts. In order to estimate the fair value of our interest rate swaps, Legacy uses a yield curve based on money market rates and interest rate swaps, extrapolates a forecast of future interest rates, estimates each future cash flow, derives discount factors to value the fixed and floating rate cash flows of each swap, and then discounts to present value all known (fixed) and forecasted (floating) swap cash flows. Curve building and discounting techniques used to establish the theoretical market value of interest bearing securities are based on readily available money market rates and interest swap market data. The determination of the fair values above incorporates various factors including the impact of our non-performance risk and the credit standing of the counterparties involved in the Partnership’s derivative contracts. The risk of nonperformance by the majority of the Partnership’s counterparties is mitigated by the fact that such counterparties (or their affiliates) are also bank lenders under the Partnership’s revolving credit facility. In addition, Legacy routinely monitors the creditworthiness of its counterparties including those who are no longer lenders under the revolving credit facility. The factors described above are based on significant assumptions made by management, and therefore, these assumptions are the most sensitive to change. | |||||||||||||||||
The following table sets forth a reconciliation of changes in the fair value of financial assets and liabilities classified as Level 3 in the fair value hierarchy: | |||||||||||||||||
Significant Unobservable Inputs | |||||||||||||||||
(Level 3) | |||||||||||||||||
Three Months Ended | Nine Months Ended | ||||||||||||||||
September 30, | September 30, | ||||||||||||||||
2013 | 2012 | 2013 | 2012 | ||||||||||||||
(In thousands) | |||||||||||||||||
Beginning balance | $ | 32,386 | $ | 41,851 | $ | 29,966 | $ | 30,054 | |||||||||
Total gains (losses) | (8,788 | ) | (8,111 | ) | (2,475 | ) | 13,260 | ||||||||||
Settlements, net | (523 | ) | (5,224 | ) | (4,416 | ) | (14,798 | ) | |||||||||
Ending balance | $ | 23,075 | $ | 28,516 | $ | 23,075 | $ | 28,516 | |||||||||
Losses included in earnings relating to derivatives still held as of September 30, 2013 and 2012 | $ | (9,311 | ) | $ | (13,335 | ) | $ | (6,891 | ) | $ | (1,538 | ) | |||||
Fair Value on a Non-Recurring Basis | |||||||||||||||||
Legacy follows the provisions of ASC 820-10 for nonfinancial assets and liabilities measured at fair value on a non-recurring basis. As it relates to Legacy, ASC 820-10 applies to certain nonfinancial assets and liabilities as may be acquired in a business combination and thereby measured at fair value; measurements of oil and natural gas property impairments; and the initial recognition of asset retirement obligations for which fair value is used. | |||||||||||||||||
The asset retirement obligation estimates are derived from historical costs as well as management’s expectation of future cost environments. As there is no corroborating market activity to support the assumptions used, Legacy has designated these liabilities as Level 3. A reconciliation of the beginning and ending balances of Legacy’s asset retirement obligation is presented in Note 8. | |||||||||||||||||
Assets measured at fair value during the nine-month period ended September 30, 2013 include: | |||||||||||||||||
Fair Value Measurements at September 30, 2013 Using | |||||||||||||||||
Quoted Prices in Active Markets for Identical Assets | Significant Other Observable Inputs | Significant Unobservable Inputs | |||||||||||||||
Description | (Level 1) | (Level 2) | (Level 3) | ||||||||||||||
(In thousands) | |||||||||||||||||
Assets: | |||||||||||||||||
Impairment (a) | $ | — | $ | — | $ | 27,553 | |||||||||||
Acquisitions (b) | $ | — | $ | — | $ | 95,369 | |||||||||||
Total | $ | — | $ | — | $ | 122,922 | |||||||||||
(a) | Legacy utilizes ASC 360-10-35 to periodically review oil and natural gas properties for impairment when facts and circumstances indicate that their carrying value may not be recoverable. Legacy compares net capitalized costs of proved oil and natural gas properties to estimated undiscounted future net cash flows using management’s expectations of future oil and natural gas prices. These future price scenarios reflect Legacy’s estimation of future price volatility. During the nine-month period ended September 30, 2013, Legacy incurred impairment charges of $23.4 million as oil and natural gas properties with a net cost basis of $50.9 million were written down to their fair value of $27.5 million. In order to determine fair value, Legacy compares net capitalized costs of proved oil and natural gas properties to estimated undiscounted future net cash flows using management’s expectations of future oil and natural gas prices. These future price scenarios reflect Legacy’s estimation of future price volatility. If the net capitalized cost exceeds the undiscounted future net cash flows, Legacy writes the net cost basis down to the discounted future net cash flows, which is management's estimate of fair value. Significant inputs used to determine the fair value include estimates of: (i) reserves; (ii) future operating and development costs; (iii) future commodity prices; and (iv) a market-based weighted average cost of capital rate. The underlying commodity prices embedded in the Company's estimated cash flows are the product of a process that begins with NYMEX forward curve pricing, adjusted for estimated location and quality differentials, as well as other factors that Legacy's management believes will impact realizable prices. The inputs used by management for the fair value measurements utilized in this review include significant unobservable inputs, and therefore, the fair value measurements employed are classified as Level 3 for these types of assets. | ||||||||||||||||
(b) | Legacy utilizes ASC 805-10 to identify and record the fair value of assets and liabilities acquired in a business combination. During the nine-month period ended September 30, 2013, Legacy acquired oil and natural gas properties, inclusive of unproved acreage acquisitions, with a fair value of $95.4 million in 12 individually immaterial transactions. Properties acquired are recorded at fair value, which correlates to the discounted future net cash flow. Significant inputs used to determine the fair value include estimates of: (i) reserves; (ii) future operating and development costs; (iii) future commodity prices; and (iv) a market-based weighted average cost of capital rate. The underlying commodity prices embedded in the Company's estimated cash flows are the product of a process that begins with NYMEX forward curve pricing, adjusted for estimated location and quality differentials, as well as other factors that Legacy's management believes will impact realizable prices. For acquired unproved properties, the market-based weighted average cost of capital rate is subjected to additional project specific risking factors. The inputs used by management for the fair value measurements of these acquired oil and natural gas properties include significant unobservable inputs, and therefore, the fair value measurements employed are classified as Level 3 for these types of assets. | ||||||||||||||||
The carrying amount of the revolving long-term debt of $314 million as of September 30, 2013 approximates fair value because Legacy's current borrowing rate does not materially differ from market rates for similar bank borrowings. Legacy has classified the revolving long-term debt as a Level 2 item within the fair value hierarchy. As of September 30, 2013, the fair values of the 2020 Senior Notes and the 2021 Senior Notes were $304.5 million and $235.9 million, respectively. As these valuations are based on unadjusted quoted prices in an active market, the fair values are classified as Level 1 items within the fair value hierarchy. |
Derivative_Financial_Instrumen
Derivative Financial Instruments | 9 Months Ended | ||||||||||||||||
Sep. 30, 2013 | |||||||||||||||||
Derivative Instruments and Hedging Activities Disclosure [Abstract] | ' | ||||||||||||||||
Derivative Financial Instruments | ' | ||||||||||||||||
Derivative Financial Instruments | |||||||||||||||||
Commodity derivative transactions | |||||||||||||||||
Due to the volatility of oil and natural gas prices, Legacy periodically enters into price-risk management transactions (e.g., swaps or collars) for a portion of its oil and natural gas production to achieve a more predictable cash flow, as well as to reduce exposure to price fluctuations. While the use of these arrangements limits Legacy’s ability to benefit from increases in the prices of oil and natural gas, it also reduces Legacy’s potential exposure to adverse price movements. Legacy’s arrangements, to the extent it enters into any, apply to only a portion of its production, provide only partial price protection against declines in oil and natural gas prices and limit Legacy’s potential gains from future increases in prices. None of these instruments are used for trading or speculative purposes. Each of these instruments were costless contracts with no upfront premium paid or payable to our counterparty. | |||||||||||||||||
All of these price risk management transactions are considered derivative instruments and are accounted for in accordance with FASB Accounting Standards Codification 815, Derivatives and Hedging Activities ("ASC 815"). These derivative instruments are intended to reduce Legacy’s price risk and may be considered hedges for economic purposes, but Legacy has chosen not to designate them as cash flow hedges for accounting purposes. Therefore, all derivative instruments are recorded on the balance sheet at fair value as of September 30, 2013 and December 31, 2012 with changes in fair value being recorded in earnings for the three and nine months ended September 30, 2013 and 2012. | |||||||||||||||||
By using derivative instruments to mitigate exposures to changes in commodity prices, Legacy is exposed to credit risk and market risk. Credit risk is the failure of the counterparty to perform under the terms of the derivative contract. When the fair value of a derivative contract is positive, the counterparty owes Legacy, which creates repayment risk. Legacy minimizes the credit or repayment risk in derivative instruments by entering into transactions with high-quality counterparties that are parties to its Credit Agreement. | |||||||||||||||||
The following table sets forth a reconciliation of the changes in fair value of Legacy's commodity derivatives for the three and nine months ended September 30, 2013 and 2012. | |||||||||||||||||
Three Months Ended | Nine Months Ended | ||||||||||||||||
September 30, | September 30, | ||||||||||||||||
2013 | 2012 | 2013 | 2012 | ||||||||||||||
(In thousands) | |||||||||||||||||
Beginning fair value of commodity derivatives | $ | 35,187 | $ | 56,907 | $ | 24,148 | $ | (8,443 | ) | ||||||||
Total gain (loss) - oil derivatives | (31,151 | ) | (24,088 | ) | (18,942 | ) | 32,962 | ||||||||||
Total gain (loss) - natural gas derivatives | 727 | (3,089 | ) | 844 | 1,122 | ||||||||||||
Oil derivative cash settlements paid (received) | 8,006 | (2,108 | ) | 9,711 | 10,948 | ||||||||||||
Natural gas derivative cash settlements received | (2,054 | ) | (4,000 | ) | (5,046 | ) | (12,967 | ) | |||||||||
Ending fair value of commodity derivatives | $ | 10,715 | $ | 23,622 | $ | 10,715 | $ | 23,622 | |||||||||
As of September 30, 2013, Legacy had the following NYMEX West Texas Intermediate ("WTI") crude oil swaps paying floating prices and receiving fixed prices for a portion of its future oil production as indicated below: | |||||||||||||||||
Average | |||||||||||||||||
Time Period | Volumes (Bbls) | Price per Bbl | Price Range per Bbl | ||||||||||||||
October-December 2013 | 620,854 | $92.90 | $80.10 | - | $107.20 | ||||||||||||
2014 | 1,776,264 | $91.67 | $87.50 | - | $103.75 | ||||||||||||
2015 | 545,351 | $91.98 | $88.50 | - | $100.20 | ||||||||||||
2016 | 228,600 | $87.94 | $86.30 | - | $99.85 | ||||||||||||
2017 | 182,500 | $84.75 | $84.75 | ||||||||||||||
As of September 30, 2013, Legacy had the following Midland to Cushing crude oil differential swaps paying a floating differential and receiving a fixed differential for a portion of its future oil production as indicated below: | |||||||||||||||||
Average | |||||||||||||||||
Time Period | Volumes (Bbls) | Price per Bbl | Price Range per Bbl | ||||||||||||||
October-December 2013 | 736,000 | ($1.47) | ($1.25) | - | ($1.75) | ||||||||||||
As of September 30, 2013, Legacy had the following NYMEX WTI crude oil derivative three-way collar contracts that combine a long put, a short put and a short call as indicated below: | |||||||||||||||||
Average Short | Average Long | Average Short | |||||||||||||||
Time Period | Volumes (Bbls) | Put Price per Bbl | Put Price per Bbl | Call Price per Bbl | |||||||||||||
October-December 2013 | 315,560 | $66.34 | $91.56 | $108.15 | |||||||||||||
2014 | 1,818,880 | $66.43 | $91.58 | $108.62 | |||||||||||||
2015 | 1,308,500 | $64.67 | $89.67 | $112.21 | |||||||||||||
2016 | 621,300 | $63.37 | $88.37 | $106.40 | |||||||||||||
2017 | 72,400 | $60.00 | $85.00 | $104.20 | |||||||||||||
As of September 30, 2013, Legacy had the following NYMEX WTI crude oil enhanced swap contracts that combine a short put, a long put and a fixed-price swap as indicated below: | |||||||||||||||||
Average Long | Average Short | Average | |||||||||||||||
Time Period | Volumes (Bbls) | Put Price per Bbl | Put Price per Bbl | Swap Price per Bbl | |||||||||||||
2015 | 365,000 | $60.00 | $80.00 | $92.35 | |||||||||||||
2016 | 183,000 | $57.00 | $82.00 | $91.70 | |||||||||||||
2017 | 182,500 | $57.00 | $82.00 | $90.85 | |||||||||||||
2018 | 127,750 | $57.00 | $82.00 | $90.50 | |||||||||||||
As of September 30, 2013, Legacy had the following NYMEX West Texas Waha, ANR-OK and CIG-Rockies natural gas swaps paying floating natural gas prices and receiving fixed prices for a portion of its future natural gas production as indicated below: | |||||||||||||||||
Average | |||||||||||||||||
Time Period | Volumes (MMBtu) | Price per MMBtu | Price Range per MMBtu | ||||||||||||||
October-December 2013 | 2,467,851 | $4.33 | $3.23 | - | $6.89 | ||||||||||||
2014 | 8,271,254 | $4.32 | $3.61 | - | $6.47 | ||||||||||||
2015 | 1,339,300 | $5.65 | $5.14 | - | $5.82 | ||||||||||||
2016 | 219,200 | $5.30 | $5.30 | ||||||||||||||
Interest rate derivative transactions | |||||||||||||||||
Due to the volatility of interest rates, Legacy periodically enters into interest rate risk management transactions in the form of interest rate swaps for a portion of its outstanding debt balance. These transactions allow Legacy to reduce exposure to interest rate fluctuations. While the use of these arrangements limits Legacy’s ability to benefit from decreases in interest rates, it also reduces Legacy’s potential exposure to increases in interest rates. Legacy’s arrangements, to the extent it enters into any, apply to only a portion of its outstanding debt balance, provide only partial protection against interest rate increases and limit Legacy’s potential savings from future interest rate declines. It is never management’s intention to hold or issue derivative instruments for speculative trading purposes. Conditions sometimes arise where actual borrowings are less than notional amounts hedged, which has, and could result in overhedged amounts. | |||||||||||||||||
Legacy accounts for these interest rate swaps pursuant to ASC 815 which establishes accounting and reporting standards requiring that derivative instruments be recorded at fair market value and included in the balance sheet as assets or liabilities. | |||||||||||||||||
Legacy does not specifically designate these derivative transactions as cash flow hedges, even though they reduce its exposure to changes in interest rates. Therefore, the mark-to-market of these instruments is recorded in current earnings as a component of interest expense. The total impact on interest expense from the mark-to-market and settlements was as follows: | |||||||||||||||||
Three Months Ended | Nine Months Ended | ||||||||||||||||
September 30, | September 30, | ||||||||||||||||
2013 | 2012 | 2013 | 2012 | ||||||||||||||
(In thousands) | |||||||||||||||||
Interest rate swap settlements | $ | 1,436 | $ | 1,768 | $ | 4,786 | $ | 5,244 | |||||||||
Unrealized change in fair value - interest rate swaps | (788 | ) | (301 | ) | (3,857 | ) | (1,057 | ) | |||||||||
Total increase to interest expense, net | $ | 648 | $ | 1,467 | $ | 929 | $ | 4,187 | |||||||||
The table below summarizes the interest rate swap position as of September 30, 2013: | |||||||||||||||||
Estimated Fair Market Value at | |||||||||||||||||
Notional Amount | Fixed Rate | Effective Date | Maturity Date | September 30, 2013 | |||||||||||||
(Dollars in thousands) | |||||||||||||||||
$ | 29,000 | 3.07 | % | 10/16/07 | 10/16/15 | $ | (1,579 | ) | |||||||||
$ | 13,000 | 3.112 | % | 11/16/07 | 11/16/15 | (750 | ) | ||||||||||
$ | 12,000 | 3.131 | % | 11/28/07 | 11/28/15 | (684 | ) | ||||||||||
$ | 50,000 | 3.1 | % | 10/10/08 | 10/10/13 | (122 | ) | ||||||||||
$ | 50,000 | 0.71 | % | 8/10/11 | 8/10/14 | (82 | ) | ||||||||||
$ | 50,000 | 2.295 | % | 12/18/08 | 12/18/13 | (257 | ) | ||||||||||
$ | 50,000 | 0.702 | % | 8/10/11 | 8/10/14 | (79 | ) | ||||||||||
$ | 50,000 | 2.5 | % | 10/10/08 | 10/10/15 | (2,137 | ) | ||||||||||
Total fair market value of interest rate derivatives | $ | (5,690 | ) |
Asset_Retirement_Obligation
Asset Retirement Obligation | 9 Months Ended | ||||||||
Sep. 30, 2013 | |||||||||
Asset Retirement Obligation [Abstract] | ' | ||||||||
Asset Retirement Obligation | ' | ||||||||
Asset Retirement Obligation | |||||||||
ASC 410-20 requires that an asset retirement obligation (“ARO”) associated with the retirement of a tangible long-lived asset be recognized as a liability in the period in which it is incurred and becomes determinable. Under this method, when liabilities for dismantlement and abandonment costs, excluding salvage values, are initially recorded, the carrying amount of the related oil and natural gas properties is increased. The fair value of the ARO asset and liability is measured using expected future cash outflows discounted at Legacy’s credit-adjusted risk-free interest rate. Accretion of the liability is recognized each period using the interest method of allocation, and the capitalized cost is depleted over the useful life of the related asset. | |||||||||
The following table reflects the changes in the ARO during the nine months ended September 30, 2013 and year ended December 31, 2012: | |||||||||
September 30, | December 31, | ||||||||
2013 | 2012 | ||||||||
(In thousands) | |||||||||
Asset retirement obligation - beginning of period | $ | 162,183 | $ | 120,274 | |||||
Liabilities incurred with properties acquired | 9,853 | 38,857 | |||||||
Liabilities incurred with properties drilled | — | 878 | |||||||
Liabilities settled during the period | (1,891 | ) | (2,412 | ) | |||||
Liabilities associated with properties sold | (1,590 | ) | — | ||||||
Current period accretion | 4,551 | 4,586 | |||||||
Asset retirement obligation - end of period | $ | 173,106 | $ | 162,183 | |||||
Earnings_Per_Unit
Earnings Per Unit | 9 Months Ended | ||||||||||||||||
Sep. 30, 2013 | |||||||||||||||||
Earnings Per Unit [Abstract] | ' | ||||||||||||||||
Earnings Per Unit | ' | ||||||||||||||||
Earnings Per Unit | |||||||||||||||||
The following table sets forth the computation of basic and diluted net earnings per unit: | |||||||||||||||||
Three Months Ended | Nine Months Ended | ||||||||||||||||
September 30, | September 30, | ||||||||||||||||
2013 | 2012 | 2013 | 2012 | ||||||||||||||
(In thousands) | |||||||||||||||||
Income (loss) available to unitholders | $ | (3,422 | ) | $ | (23,566 | ) | $ | 11,627 | $ | 66,765 | |||||||
Weighted average number of units outstanding | 57,275 | 47,869 | 57,200 | 47,840 | |||||||||||||
Effect of dilutive securities: | |||||||||||||||||
Restricted and phantom units | — | — | 95 | — | |||||||||||||
Weighted average units and potential units outstanding | 57,275 | 47,869 | 57,295 | 47,840 | |||||||||||||
Basic and diluted earnings (loss) per unit | $ | (0.06 | ) | $ | (0.49 | ) | $ | 0.2 | $ | 1.4 | |||||||
For the three and nine months ended September 30, 2013, 425,195 and 330,116 restricted and phantom units, respectively, were excluded from the calculation of diluted earnings per unit due to their anti-dilutive effect. For the three and nine months ended September 30, 2012, 227,477 restricted units were excluded from the calculation of diluted earnings per unit due to their anti-dilutive effect. |
Unit_Based_Compensation
Unit Based Compensation | 9 Months Ended | |||||||||||||
Sep. 30, 2013 | ||||||||||||||
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | ' | |||||||||||||
Unit Based Compensation | ' | |||||||||||||
Unit-Based Compensation | ||||||||||||||
Long-Term Incentive Plan | ||||||||||||||
On March 15, 2006, a Long-Term Incentive Plan (“LTIP”) for Legacy was implemented for its employees, consultants and directors, its affiliates and its general partner. The awards under the LTIP may include unit grants, restricted units, phantom units, unit options and unit appreciation rights ("UARs"). The LTIP permits the grant of awards covering an aggregate of 2,000,000 units. As of September 30, 2013, grants of awards net of forfeitures and, in the case of UARs and phantom units, historical exercises covering 1,626,924 units had been made, comprised of 266,014 unit option awards, 615,043 UARs, 438,486 restricted unit awards, 195,143 phantom unit awards and 112,238 unit awards. The LTIP is administered by the compensation committee (the “Compensation Committee”) of the board of directors of Legacy’s general partner. | ||||||||||||||
ASC 718 requires companies to measure the cost of employee services in exchange for an award of equity instruments based on a grant-date fair value of the award (with limited exceptions), and that cost must generally be recognized over the vesting period of the award. However, ASC 718 stipulates that “if an entity that nominally has the choice of settling awards by issuing stock predominately settles in cash, or if the entity usually settles in cash whenever an employee asks for cash settlement, the entity is settling a substantive liability rather than repurchasing an equity instrument.” Due to Legacy's historical practice of settling unit options, UARs and phantom unit awards in cash, Legacy accounts for unit options, UARs and certain phantom unit awards by utilizing the liability method as described in ASC 718. The liability method requires companies to measure the cost of the employee services in exchange for a cash award based on the fair value of the underlying security at the end of each reporting period. Compensation cost is recognized based on the change in the liability between periods. However, during 2013, the Compensation Committee revised the executive compensation plan and amended certain historical phantom unit award agreements to eliminate the Compensation Committee's option of settling phantom unit awards for executive officers in cash. Due to the elimination of the cash settlement option, Legacy now accounts for executive phantom unit awards under the equity method as described in ASC 718. Legacy treated the amendment as a cancellation of the historical awards and a grant of new awards in the period, though the award amounts and vesting terms remained unchanged. | ||||||||||||||
Unit Appreciation Rights and Unit Options | ||||||||||||||
A unit appreciation right is a notional unit that entitles the holder, upon vesting, to receive cash valued at the difference between the closing price of units on the exercise date and the exercise price, as determined on the date of grant. Because these awards are settled in cash, Legacy is accounting for the UARs by utilizing the liability method. | ||||||||||||||
During the year ended December 31, 2012, Legacy issued 82,400 UARs to employees which vest ratably over a three-year period and 60,336 UARs to employees which vest at the end of a three-year period. During the nine-month period ended September 30, 2013, Legacy issued 123,650 UARs to employees which vest ratably over a three-year period and 74,506 UARs to employees which vest at the end of a three-year period. All UARs granted in 2012 and 2013 expire seven years from the grant date and are exercisable when they vest. | ||||||||||||||
For the nine-month periods ended September 30, 2013 and 2012, Legacy recorded $0.7 million and $0.5 million, respectively, of compensation expense due to the change in liability from December 31, 2012 and 2011, respectively, based on its use of the Black-Scholes model to estimate the September 30, 2013 and 2012 fair value of these UARs and unit options (see Note 6). As of September 30, 2013, there was a total of approximately $1.6 million of unrecognized compensation costs related to the unexercised and non-vested portion of these UARs. At September 30, 2013, this cost was expected to be recognized over a weighted-average period of approximately 2.3 years. Compensation expense is based upon the fair value as of September 30, 2013 and is recognized as a percentage of the service period satisfied. Since Legacy's trading history does not yet match the term of the outstanding UAR and unit option awards, it has used an estimated volatility factor of approximately 51% based upon the historical trends of a representative group of publicly-traded companies in the energy industry and employed the Black-Scholes model to estimate the September 30, 2013 fair value to be realized as compensation cost based on the percentage of service period satisfied. Based on historical data, Legacy has assumed an estimated forfeiture rate of 3.7%. As required by ASC 718, Legacy will adjust the estimated forfeiture rate based upon actual experience. Legacy has assumed an annual distribution rate of $2.32 per unit. | ||||||||||||||
A summary of UAR and unit option activity for the nine months ended September 30, 2013 is as follows: | ||||||||||||||
Units | Weighted-Average Exercise Price | Weighted-Average Remaining Contractual Term | Aggregate Intrinsic Value | |||||||||||
Outstanding at January 1, 2013 | 516,219 | $ | 24.71 | |||||||||||
Granted | 198,156 | 26.41 | ||||||||||||
Exercised | (83,666 | ) | 19.92 | |||||||||||
Forfeited | (15,666 | ) | 26.46 | |||||||||||
Outstanding at September 30, 2013 | 615,043 | $ | 25.86 | 5.3 | $ | 1,063,605 | ||||||||
UARs and unit options exercisable at September 30, 2013 | 235,154 | $ | 23.63 | 3.9 | $ | 897,780 | ||||||||
The following table summarizes the status of Legacy’s non-vested UARs since January 1, 2013: | ||||||||||||||
Non-Vested UARs | ||||||||||||||
Number of Units | Weighted-Average Exercise Price | |||||||||||||
Non-vested at January 1, 2013 | 347,650 | $ | 26.73 | |||||||||||
Granted | 198,156 | 26.41 | ||||||||||||
Vested | (151,917 | ) | 24.96 | |||||||||||
Forfeited | (14,000 | ) | 27.35 | |||||||||||
Non-vested at September 30, 2013 | 379,889 | $ | 27.25 | |||||||||||
Legacy has used a weighted-average risk-free interest rate of 1.4% in its Black-Scholes calculation of fair value, which approximates the U.S. Treasury interest rates at September 30, 2013 whose terms are consistent with the expected life of the UARs and unit options. Expected life represents the period of time that UARs and unit options are expected to be outstanding and is based on Legacy’s best estimate. The following table represents the weighted-average assumptions used for the Black-Scholes option-pricing model. | ||||||||||||||
Nine Months Ended | ||||||||||||||
September 30, | ||||||||||||||
2013 | ||||||||||||||
Expected life (years) | 5.52 | |||||||||||||
Risk free interest rate | 1.4 | % | ||||||||||||
Annual distribution rate per unit | $2.32 | |||||||||||||
Volatility | 51 | % | ||||||||||||
Phantom Units | ||||||||||||||
Legacy has also issued phantom units under the LTIP to both executive officers, as described below, and certain other employees. A phantom unit is a notional unit that entitles the holder, upon vesting, to receive, in the case of non-executive employees, cash valued at the closing price of units on the vesting date, or, at the discretion of the Compensation Committee, the same number of Partnership units. Because Legacy’s current intent is to settle these non-executive phantom unit awards in cash, Legacy is accounting for these phantom units by utilizing the liability method. As mentioned above, in the case of executive employees, the Compensation Committee revised the historical grants for all executive phantom units to eliminate any election for cash payment. As these awards can now only be settled in Partnership units, Legacy is accounting for these phantom units by utilizing the equity method as described in ASC 718. | ||||||||||||||
On September 21, 2009, the board of directors of Legacy’s general partner, upon the recommendation of the Compensation Committee, implemented an equity-based incentive compensation policy applicable to the executive officers of Legacy. In addition to cash bonus awards, under the compensation plan, the executives are eligible for both subjective and objective grants of phantom units. The subjective, or service-based, grants may be awarded up to a maximum percentage of annual salary as determined by the Compensation Committee. Once granted, these phantom units vest ratably over a three-year period. The objective, or performance-based, grants may be awarded up to a maximum percentage of annual salary as determined by the Compensation Committee. However, the amount to vest each year for the three-year vesting period will be determined on each vesting date based on a three-step process, with the first two steps each comprising 50% of the total vesting amount while the third step is the sum of the first two steps. The first step in the process will be a function of Total Unitholder Return (“TUR”) for the Partnership and the percentage rank of the Legacy TUR among a peer group of upstream master limited partnerships, as determined by the Compensation Committee at the beginning of each year. In the second step, the Legacy TUR will be compared to the TUR of a group of master limited partnerships included in the Alerian MLP Index. The third step is the addition of the above two steps to determine the total performance-based awards to vest. Performance based phantom units subject to vesting which do not vest in a given year will be forfeited. With respect to both the subjective and objective units awarded under this compensation policy, distribution equivalent rights ("DERs") will accumulate and accrue based on the total number of actual amounts vested and will be payable at the date of vesting. However, due to the aforementioned revision for executive employees, accrued DERs paid at the date of vesting will be treated as distributions in the period paid rather than being recognized as compensation expense over the life of the award. | ||||||||||||||
On February 1, 2012 and February 2, 2012, the Compensation Committee approved the award of 30,828 subjective, or service-based, phantom units and 57,189 objective, or performance based, phantom units to Legacy’s executive officers. On March 7, 2013, the Compensation Committee approved the award of 46,430 subjective, or service-based, phantom units and 76,723 objective, or performance based, phantom units to Legacy’s executive officers. | ||||||||||||||
Compensation expense related to the phantom units and associated DERs was $0.7 million and $1.5 million for the nine months ended September 30, 2013 and 2012, respectively. | ||||||||||||||
Restricted Units | ||||||||||||||
During the year ended December 31, 2012, Legacy issued an aggregate of 173,645 restricted units to both non-executive employees and certain executives not previously covered under the executive compensation plan. These restricted units awarded mostly vest ratably over a three-year period, ratably over a two-year period or cliff-vest at the end of a five year period, all beginning on or around the date of grant. During the nine-month period ended September 30, 2013, Legacy issued an aggregate of 84,528 restricted units to non-executive employees. These restricted units awarded vest either ratably over a three or five-year period, all beginning on or around the date of grant. Compensation expense related to restricted units was $1.7 million and $1.2 million for the nine months ended September 30, 2013 and 2012, respectively. As of September 30, 2013, there was a total of $5.4 million of unrecognized compensation expense related to the unvested portion of these restricted units. At September 30, 2013, this cost was expected to be recognized over a weighted-average period of 2.8 years. Pursuant to the provisions of ASC 718, Legacy’s issued units, as reflected in the accompanying consolidated balance sheet at September 30, 2013, do not include 236,052 units related to unvested restricted unit awards. | ||||||||||||||
Board and Additional Executive Units | ||||||||||||||
On May 9, 2012, Legacy granted and issued 3,509 units to each of its five non-employee directors and 2,500 units to an executive officer. The value of each unit was $28.34 at the time of issuance. On May 14, 2013, Legacy granted and issued 3,715 units to each of its five non-employee directors. The value of each unit was $27.39 at the time of issuance. |
Subsidiary_Guarantors
Subsidiary Guarantors | 9 Months Ended |
Sep. 30, 2013 | |
Guarantees [Abstract] | ' |
Subsidiary Guarantors | ' |
Subsidiary Guarantors | |
On September 6, 2011, we filed a post-effective amendment to a registration statement on Form S-3 with the Securities and Exchange Commission ("SEC") to register the issuance and sale of, among other securities, our debt securities, which may be co-issued by Legacy Reserves Finance Corporation. The registration statement also registered guarantees of debt securities by Legacy Reserves Operating GP, LLC, Legacy Reserves Operating LP and Legacy Reserves Services, Inc. The Partnership's 2020 Senior Notes were issued in a private offering on December 4, 2012 and are currently unregistered but we have agreed to register them by January 8, 2014 or be subject to certain penalties. The Partnership's 2021 Senior Notes were issued in a private offering on May 28, 2013 and are currently unregistered but we have agreed to register them by July 2, 2014 or be subject to certain penalties. The 2020 Senior Notes and the 2021 Senior Notes are guaranteed by our 100% owned subsidiaries Legacy Reserves Operating GP, LLC, Legacy Reserves Operating LP and Legacy Reserves Services, Inc., which constitute all of our wholly-owned subsidiaries other than Legacy Reserves Finance Corporation, and certain other future subsidiaries (the “Guarantors”, together with any future 100% owned subsidiaries that guarantee the Partnership's 2020 Senior Notes and 2021 Senior Notes, the “Subsidiaries”). The Subsidiaries are 100% owned by the Partnership and the guarantees by the Subsidiaries are full and unconditional, except for customary release provisions described in Note 2 - Long-Term Debt. The Partnership has no assets or operations independent of the Subsidiaries, and there are no significant restrictions upon the ability of the Subsidiaries to distribute funds to the Partnership. The guarantees constitute joint and several obligations of the Guarantors. |
Subsequent_Events
Subsequent Events | 9 Months Ended |
Sep. 30, 2013 | |
Subsequent Events [Abstract] | ' |
Subsequent Events | ' |
Subsequent Events | |
On October 22, 2013, Legacy’s board of directors approved a distribution of $0.585 per unit payable on November 14, 2013 to unitholders of record on November 1, 2013, representing an increase of $0.005 per unit over the last quarterly distribution. | |
On October 15, 2013, the borrowing base under our Credit Agreement was increased to $800.0 million from $737.5 million. The next redetermination is scheduled on or around April 2014. |
Summary_of_Significant_Account1
Summary of Significant Accounting Policies (Tables) | 9 Months Ended | |||||||
Sep. 30, 2013 | ||||||||
Accounting Policies [Abstract] | ' | |||||||
Schedule of components of accrued oil and natural gas liabilities | ' | |||||||
Below are the components of accrued oil and natural gas liabilities as of September 30, 2013 and December 31, 2012. | ||||||||
September 30, | December 31, | |||||||
2013 | 2012 | |||||||
(In thousands) | ||||||||
Revenue payable to joint interest owners | $ | 24,996 | $ | 24,903 | ||||
Accrued lease operating expense | 12,334 | 8,507 | ||||||
Accrued capital expenditures | 9,672 | 5,213 | ||||||
Accrued ad valorem tax | 13,677 | 4,806 | ||||||
Other | 12,503 | 6,733 | ||||||
$ | 73,182 | $ | 50,162 | |||||
LongTerm_Debt_Tables
Long-Term Debt (Tables) | 9 Months Ended | |||
Sep. 30, 2013 | ||||
Debt Disclosure [Abstract] | ' | |||
Schedule of 8% Senior Note Redemption Premium | ' | |||
Legacy will have the option to redeem the 2020 Senior Notes, in whole or in part, at any time on or after December 1, 2016, at the specified redemption prices set forth below together with any accrued and unpaid interest, if any, to the date of redemption if redeemed during the twelve-month period beginning on December 1 of the years indicated below. | ||||
Year | Percentage | |||
2016 | 104 | % | ||
2017 | 102 | % | ||
2018 and thereafter | 100 | % | ||
Schedule of 6.625% Senior Note Redemption Premium | ' | |||
Legacy will have the option to redeem the 2021 Senior Notes, in whole or in part, at any time on or after June 1, 2017, at the specified redemption prices set forth below together with any accrued and unpaid interest, if any, to the date of redemption if redeemed during the twelve-month period beginning on June 1 of the years indicated below. | ||||
Year | Percentage | |||
2017 | 103.313 | % | ||
2018 | 101.656 | % | ||
2019 and thereafter | 100 | % |
Acquisitions_Tables
Acquisitions (Tables) (COG 2012 Acquisition [Domain]) | 9 Months Ended | ||||||||||||
Sep. 30, 2013 | Sep. 30, 2012 | ||||||||||||
COG 2012 Acquisition [Domain] | ' | ' | |||||||||||
Significant Acquisitions and Disposals [Line Items] | ' | ' | |||||||||||
Schedule of allocation of the purchase price to the fair value of the acquired assets and liabilities assumed | ' | ' | |||||||||||
The allocation of the purchase price to the fair value of the acquired assets and liabilities assumed was as follows (in thousands): | |||||||||||||
Proved oil and natural gas properties including related equipment | $ | 495,897 | |||||||||||
Unproved properties | 37,994 | ||||||||||||
Total assets | 533,891 | ||||||||||||
Future abandonment costs | (31,274 | ) | |||||||||||
Fair value of net assets acquired | $ | 502,617 | |||||||||||
Schedule of pro forma operating results | ' | ' | |||||||||||
The following table reflects the unaudited pro forma results of operations as though the COG 2012 Acquisition had occurred on January 1, 2011. The pro forma amounts are not necessarily indicative of the results that may be reported in the future. | |||||||||||||
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||
2012 | 2012 | ||||||||||||
(In thousands) | |||||||||||||
Revenues | $ | 115,819 | $ | 369,601 | |||||||||
Net income (loss) | $ | (18,475 | ) | $ | 87,883 | ||||||||
Income (loss) per unit — basic and diluted | $ | (0.32 | ) | $ | 1.54 | ||||||||
Units used in computing income per unit: | |||||||||||||
Basic and Diluted | 57,039 | 57,010 | |||||||||||
The amounts of revenues and revenues in excess of direct operating expenses included in our consolidated statements of operations for the COG 2012 Acquisition are shown in the table that follows. Direct operating expenses include lease operating expenses and production and other taxes. | |||||||||||||
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||
2013 | 2013 | ||||||||||||
(In thousands) | |||||||||||||
Revenues | $ | 30,683 | $ | 86,548 | |||||||||
Excess of revenues over direct operating expenses | $ | 21,633 | $ | 59,128 | |||||||||
Fair_Value_Measurements_Tables
Fair Value Measurements (Tables) | 9 Months Ended | ||||||||||||||||
Sep. 30, 2013 | |||||||||||||||||
Fair Value Disclosures [Abstract] | ' | ||||||||||||||||
Schedule of Fair Value, Assets and Liabilities Measured on Recurring Basis | ' | ||||||||||||||||
The following table sets forth by level within the fair value hierarchy Legacy’s financial assets and liabilities that were accounted for at fair value on a recurring basis as of September 30, 2013: | |||||||||||||||||
Fair Value Measurements at September 30, 2013 Using | |||||||||||||||||
Quoted Prices in Active Markets for Identical Assets | Significant Other Observable Inputs | Significant Unobservable Inputs | Total Carrying Value as of | ||||||||||||||
Description | (Level 1) | (Level 2) | (Level 3) | September 30, 2013 | |||||||||||||
(In thousands) | |||||||||||||||||
LTIP liability (a) | $ | — | $ | (2,085 | ) | $ | — | $ | (2,085 | ) | |||||||
Oil and natural gas swaps | — | (12,360 | ) | 8,597 | (3,763 | ) | |||||||||||
Oil collars | — | — | 14,478 | 14,478 | |||||||||||||
Interest rate swaps | — | (5,690 | ) | — | (5,690 | ) | |||||||||||
Total | $ | — | $ | (20,135 | ) | $ | 23,075 | $ | 2,940 | ||||||||
(a) | See Note 10 for further discussion on unit-based compensation expenses and the related LTIP liability for certain grants accounted for under the liability method. | ||||||||||||||||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation | ' | ||||||||||||||||
The following table sets forth a reconciliation of changes in the fair value of financial assets and liabilities classified as Level 3 in the fair value hierarchy: | |||||||||||||||||
Significant Unobservable Inputs | |||||||||||||||||
(Level 3) | |||||||||||||||||
Three Months Ended | Nine Months Ended | ||||||||||||||||
September 30, | September 30, | ||||||||||||||||
2013 | 2012 | 2013 | 2012 | ||||||||||||||
(In thousands) | |||||||||||||||||
Beginning balance | $ | 32,386 | $ | 41,851 | $ | 29,966 | $ | 30,054 | |||||||||
Total gains (losses) | (8,788 | ) | (8,111 | ) | (2,475 | ) | 13,260 | ||||||||||
Settlements, net | (523 | ) | (5,224 | ) | (4,416 | ) | (14,798 | ) | |||||||||
Ending balance | $ | 23,075 | $ | 28,516 | $ | 23,075 | $ | 28,516 | |||||||||
Losses included in earnings relating to derivatives still held as of September 30, 2013 and 2012 | $ | (9,311 | ) | $ | (13,335 | ) | $ | (6,891 | ) | $ | (1,538 | ) | |||||
Fair Value Measurements, Nonrecurring | ' | ||||||||||||||||
Assets measured at fair value during the nine-month period ended September 30, 2013 include: | |||||||||||||||||
Fair Value Measurements at September 30, 2013 Using | |||||||||||||||||
Quoted Prices in Active Markets for Identical Assets | Significant Other Observable Inputs | Significant Unobservable Inputs | |||||||||||||||
Description | (Level 1) | (Level 2) | (Level 3) | ||||||||||||||
(In thousands) | |||||||||||||||||
Assets: | |||||||||||||||||
Impairment (a) | $ | — | $ | — | $ | 27,553 | |||||||||||
Acquisitions (b) | $ | — | $ | — | $ | 95,369 | |||||||||||
Total | $ | — | $ | — | $ | 122,922 | |||||||||||
Derivative_Financial_Instrumen1
Derivative Financial Instruments (Tables) | 9 Months Ended | ||||||||||||||||
Sep. 30, 2013 | |||||||||||||||||
Derivative Instruments and Hedging Activities Disclosure [Abstract] | ' | ||||||||||||||||
Schedule of Derivative Instruments in Statement of Financial Position, Fair Value | ' | ||||||||||||||||
The total impact on interest expense from the mark-to-market and settlements was as follows: | |||||||||||||||||
Three Months Ended | Nine Months Ended | ||||||||||||||||
September 30, | September 30, | ||||||||||||||||
2013 | 2012 | 2013 | 2012 | ||||||||||||||
(In thousands) | |||||||||||||||||
Interest rate swap settlements | $ | 1,436 | $ | 1,768 | $ | 4,786 | $ | 5,244 | |||||||||
Unrealized change in fair value - interest rate swaps | (788 | ) | (301 | ) | (3,857 | ) | (1,057 | ) | |||||||||
Total increase to interest expense, net | $ | 648 | $ | 1,467 | $ | 929 | $ | 4,187 | |||||||||
Schedule of Derivative Instruments, Gain (Loss) in Statement of Financial Performance | ' | ||||||||||||||||
or the three and nine months ended September 30, 2013 and 2012. | |||||||||||||||||
Three Months Ended | Nine Months Ended | ||||||||||||||||
September 30, | September 30, | ||||||||||||||||
2013 | 2012 | 2013 | 2012 | ||||||||||||||
(In thousands) | |||||||||||||||||
Beginning fair value of commodity derivatives | $ | 35,187 | $ | 56,907 | $ | 24,148 | $ | (8,443 | ) | ||||||||
Total gain (loss) - oil derivatives | (31,151 | ) | (24,088 | ) | (18,942 | ) | 32,962 | ||||||||||
Total gain (loss) - natural gas derivatives | 727 | (3,089 | ) | 844 | 1,122 | ||||||||||||
Oil derivative cash settlements paid (received) | 8,006 | (2,108 | ) | 9,711 | 10,948 | ||||||||||||
Natural gas derivative cash settlements received | (2,054 | ) | (4,000 | ) | (5,046 | ) | (12,967 | ) | |||||||||
Ending fair value of commodity derivatives | $ | 10,715 | $ | 23,622 | $ | 10,715 | $ | 23,622 | |||||||||
Schedule of Notional Amounts of Outstanding Derivative Positions | ' | ||||||||||||||||
As of September 30, 2013, Legacy had the following NYMEX West Texas Intermediate ("WTI") crude oil swaps paying floating prices and receiving fixed prices for a portion of its future oil production as indicated below: | |||||||||||||||||
Average | |||||||||||||||||
Time Period | Volumes (Bbls) | Price per Bbl | Price Range per Bbl | ||||||||||||||
October-December 2013 | 620,854 | $92.90 | $80.10 | - | $107.20 | ||||||||||||
2014 | 1,776,264 | $91.67 | $87.50 | - | $103.75 | ||||||||||||
2015 | 545,351 | $91.98 | $88.50 | - | $100.20 | ||||||||||||
2016 | 228,600 | $87.94 | $86.30 | - | $99.85 | ||||||||||||
2017 | 182,500 | $84.75 | $84.75 | ||||||||||||||
As of September 30, 2013, Legacy had the following Midland to Cushing crude oil differential swaps paying a floating differential and receiving a fixed differential for a portion of its future oil production as indicated below: | |||||||||||||||||
Average | |||||||||||||||||
Time Period | Volumes (Bbls) | Price per Bbl | Price Range per Bbl | ||||||||||||||
October-December 2013 | 736,000 | ($1.47) | ($1.25) | - | ($1.75) | ||||||||||||
As of September 30, 2013, Legacy had the following NYMEX WTI crude oil derivative three-way collar contracts that combine a long put, a short put and a short call as indicated below: | |||||||||||||||||
Average Short | Average Long | Average Short | |||||||||||||||
Time Period | Volumes (Bbls) | Put Price per Bbl | Put Price per Bbl | Call Price per Bbl | |||||||||||||
October-December 2013 | 315,560 | $66.34 | $91.56 | $108.15 | |||||||||||||
2014 | 1,818,880 | $66.43 | $91.58 | $108.62 | |||||||||||||
2015 | 1,308,500 | $64.67 | $89.67 | $112.21 | |||||||||||||
2016 | 621,300 | $63.37 | $88.37 | $106.40 | |||||||||||||
2017 | 72,400 | $60.00 | $85.00 | $104.20 | |||||||||||||
As of September 30, 2013, Legacy had the following NYMEX WTI crude oil enhanced swap contracts that combine a short put, a long put and a fixed-price swap as indicated below: | |||||||||||||||||
Average Long | Average Short | Average | |||||||||||||||
Time Period | Volumes (Bbls) | Put Price per Bbl | Put Price per Bbl | Swap Price per Bbl | |||||||||||||
2015 | 365,000 | $60.00 | $80.00 | $92.35 | |||||||||||||
2016 | 183,000 | $57.00 | $82.00 | $91.70 | |||||||||||||
2017 | 182,500 | $57.00 | $82.00 | $90.85 | |||||||||||||
2018 | 127,750 | $57.00 | $82.00 | $90.50 | |||||||||||||
As of September 30, 2013, Legacy had the following NYMEX West Texas Waha, ANR-OK and CIG-Rockies natural gas swaps paying floating natural gas prices and receiving fixed prices for a portion of its future natural gas production as indicated below: | |||||||||||||||||
Average | |||||||||||||||||
Time Period | Volumes (MMBtu) | Price per MMBtu | Price Range per MMBtu | ||||||||||||||
October-December 2013 | 2,467,851 | $4.33 | $3.23 | - | $6.89 | ||||||||||||
2014 | 8,271,254 | $4.32 | $3.61 | - | $6.47 | ||||||||||||
2015 | 1,339,300 | $5.65 | $5.14 | - | $5.82 | ||||||||||||
2016 | 219,200 | $5.30 | $5.30 | ||||||||||||||
Schedule of Interest Rate Derivatives | ' | ||||||||||||||||
The table below summarizes the interest rate swap position as of September 30, 2013: | |||||||||||||||||
Estimated Fair Market Value at | |||||||||||||||||
Notional Amount | Fixed Rate | Effective Date | Maturity Date | September 30, 2013 | |||||||||||||
(Dollars in thousands) | |||||||||||||||||
$ | 29,000 | 3.07 | % | 10/16/07 | 10/16/15 | $ | (1,579 | ) | |||||||||
$ | 13,000 | 3.112 | % | 11/16/07 | 11/16/15 | (750 | ) | ||||||||||
$ | 12,000 | 3.131 | % | 11/28/07 | 11/28/15 | (684 | ) | ||||||||||
$ | 50,000 | 3.1 | % | 10/10/08 | 10/10/13 | (122 | ) | ||||||||||
$ | 50,000 | 0.71 | % | 8/10/11 | 8/10/14 | (82 | ) | ||||||||||
$ | 50,000 | 2.295 | % | 12/18/08 | 12/18/13 | (257 | ) | ||||||||||
$ | 50,000 | 0.702 | % | 8/10/11 | 8/10/14 | (79 | ) | ||||||||||
$ | 50,000 | 2.5 | % | 10/10/08 | 10/10/15 | (2,137 | ) | ||||||||||
Total fair market value of interest rate derivatives | $ | (5,690 | ) |
Asset_Retirement_Obligation_Ta
Asset Retirement Obligation (Tables) | 9 Months Ended | ||||||||
Sep. 30, 2013 | |||||||||
Asset Retirement Obligation [Abstract] | ' | ||||||||
Schedule of Change in Asset Retirement Obligation | ' | ||||||||
The following table reflects the changes in the ARO during the nine months ended September 30, 2013 and year ended December 31, 2012: | |||||||||
September 30, | December 31, | ||||||||
2013 | 2012 | ||||||||
(In thousands) | |||||||||
Asset retirement obligation - beginning of period | $ | 162,183 | $ | 120,274 | |||||
Liabilities incurred with properties acquired | 9,853 | 38,857 | |||||||
Liabilities incurred with properties drilled | — | 878 | |||||||
Liabilities settled during the period | (1,891 | ) | (2,412 | ) | |||||
Liabilities associated with properties sold | (1,590 | ) | — | ||||||
Current period accretion | 4,551 | 4,586 | |||||||
Asset retirement obligation - end of period | $ | 173,106 | $ | 162,183 | |||||
Earnings_Per_Unit_Tables
Earnings Per Unit (Tables) | 9 Months Ended | ||||||||||||||||
Sep. 30, 2013 | |||||||||||||||||
Earnings Per Unit [Abstract] | ' | ||||||||||||||||
Schedule of Earnings Per Share, Basic and Diluted | ' | ||||||||||||||||
The following table sets forth the computation of basic and diluted net earnings per unit: | |||||||||||||||||
Three Months Ended | Nine Months Ended | ||||||||||||||||
September 30, | September 30, | ||||||||||||||||
2013 | 2012 | 2013 | 2012 | ||||||||||||||
(In thousands) | |||||||||||||||||
Income (loss) available to unitholders | $ | (3,422 | ) | $ | (23,566 | ) | $ | 11,627 | $ | 66,765 | |||||||
Weighted average number of units outstanding | 57,275 | 47,869 | 57,200 | 47,840 | |||||||||||||
Effect of dilutive securities: | |||||||||||||||||
Restricted and phantom units | — | — | 95 | — | |||||||||||||
Weighted average units and potential units outstanding | 57,275 | 47,869 | 57,295 | 47,840 | |||||||||||||
Basic and diluted earnings (loss) per unit | $ | (0.06 | ) | $ | (0.49 | ) | $ | 0.2 | $ | 1.4 | |||||||
Unit_Based_Compensation_Tables
Unit Based Compensation (Tables) | 9 Months Ended | |||||||||||||
Sep. 30, 2013 | ||||||||||||||
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | ' | |||||||||||||
Schedule of Share-based Payment Award, Stock Options, Valuation Assumptions | ' | |||||||||||||
The following table represents the weighted-average assumptions used for the Black-Scholes option-pricing model. | ||||||||||||||
Nine Months Ended | ||||||||||||||
September 30, | ||||||||||||||
2013 | ||||||||||||||
Expected life (years) | 5.52 | |||||||||||||
Risk free interest rate | 1.4 | % | ||||||||||||
Annual distribution rate per unit | $2.32 | |||||||||||||
Volatility | 51 | % | ||||||||||||
Schedule of Share-based Compensation, Stock Options, Activity | ' | |||||||||||||
A summary of UAR and unit option activity for the nine months ended September 30, 2013 is as follows: | ||||||||||||||
Units | Weighted-Average Exercise Price | Weighted-Average Remaining Contractual Term | Aggregate Intrinsic Value | |||||||||||
Outstanding at January 1, 2013 | 516,219 | $ | 24.71 | |||||||||||
Granted | 198,156 | 26.41 | ||||||||||||
Exercised | (83,666 | ) | 19.92 | |||||||||||
Forfeited | (15,666 | ) | 26.46 | |||||||||||
Outstanding at September 30, 2013 | 615,043 | $ | 25.86 | 5.3 | $ | 1,063,605 | ||||||||
UARs and unit options exercisable at September 30, 2013 | 235,154 | $ | 23.63 | 3.9 | $ | 897,780 | ||||||||
Schedule of Nonvested Share Activity | ' | |||||||||||||
The following table summarizes the status of Legacy’s non-vested UARs since January 1, 2013: | ||||||||||||||
Non-Vested UARs | ||||||||||||||
Number of Units | Weighted-Average Exercise Price | |||||||||||||
Non-vested at January 1, 2013 | 347,650 | $ | 26.73 | |||||||||||
Granted | 198,156 | 26.41 | ||||||||||||
Vested | (151,917 | ) | 24.96 | |||||||||||
Forfeited | (14,000 | ) | 27.35 | |||||||||||
Non-vested at September 30, 2013 | 379,889 | $ | 27.25 | |||||||||||
Summary_of_Significant_Account2
Summary of Significant Accounting Policies (Details) (USD $) | 9 Months Ended | |
In Thousands, unless otherwise specified | Sep. 30, 2013 | Dec. 31, 2012 |
Accounting Policies [Abstract] | ' | ' |
General partner interest | 0.03% | ' |
Partners right to receive distribution term | '45 days | ' |
Percentage required to remove general partner | 66.67% | ' |
Right to receive tax information term | '90 days | ' |
Revenue payable to joint interest owners | $24,996 | $24,903 |
Accrued lease operating expense | 12,334 | 8,507 |
Accrued capital expenditures | 9,672 | 5,213 |
Accrued ad valorem tax | 13,677 | 4,806 |
Other | 12,503 | 6,733 |
Accrued oil and natural gas liabilities | $73,182 | $50,162 |
LongTerm_Debt_Schedule_of_Debt
Long-Term Debt - Schedule of Debt (Details) (USD $) | Sep. 30, 2013 | Dec. 31, 2012 |
In Thousands, unless otherwise specified | ||
Debt Instrument [Line Items] | ' | ' |
Long-term Debt, Gross | $864,000 | $788,000 |
Unamortized discount on Senior Notes | 19,693 | 12,162 |
Total Long-Term Debt | 844,307 | 775,838 |
Revolving Credit Facility [Member] | ' | ' |
Debt Instrument [Line Items] | ' | ' |
Line of Credit Facility, Amount Outstanding | 314,000 | 488,000 |
8% Senior Notes [Member] | ' | ' |
Debt Instrument [Line Items] | ' | ' |
Debt Instrument, Face Amount | 300,000 | 300,000 |
6.625% Senior Notes [Member] | ' | ' |
Debt Instrument [Line Items] | ' | ' |
Debt Instrument, Face Amount | $250,000 | $0 |
LongTerm_Debt_Details
Long-Term Debt (Details) (USD $) | 0 Months Ended | 9 Months Ended | 12 Months Ended | 0 Months Ended | 9 Months Ended | 9 Months Ended | 12 Months Ended | ||||||||||||||||
Mar. 28, 2013 | Mar. 10, 2011 | Sep. 30, 2013 | Sep. 30, 2012 | Dec. 04, 2013 | Oct. 15, 2013 | Mar. 28, 2013 | Sep. 30, 2013 | Dec. 31, 2012 | Mar. 10, 2011 | Sep. 30, 2013 | Sep. 30, 2013 | Dec. 31, 2012 | Sep. 30, 2013 | Dec. 04, 2013 | Dec. 31, 2012 | Dec. 04, 2012 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | |
6.625% Senior Notes [Member] | 6.625% Senior Notes [Member] | 6.625% Senior Notes [Member] | 6.625% Senior Notes [Member] | Senior Notes [Member] | Revolving Credit Facility [Member] | Revolving Credit Facility [Member] | 8% Senior Notes [Member] | 8% Senior Notes [Member] | 8% Senior Notes [Member] | 8% Senior Notes [Member] | Redemption Premium Year Four [Member] | Redemption Premium Year Five [Member] | Redemption Premium Year Six [Member] | Redemption Premium Year Six [Member] | Redemption Premium Year Five [Member] | Redemption Premium Year Four [Member] | |||||||
Debt Instrument [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Line of Credit Facility, Maximum Borrowing Capacity | ' | $1,000,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Borrowing Base sub-limit for Letters of Credit | ' | 2,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Debt Instrument, Interest Rate, Stated Percentage | ' | ' | ' | ' | ' | ' | ' | ' | ' | 6.63% | ' | ' | ' | ' | ' | ' | 8.00% | ' | ' | ' | ' | ' | ' |
Line of Credit Facility, Current Borrowing Capacity | ' | 737,500,000 | ' | ' | ' | 800,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Purchase Price of Properties as a Percentage of Borrowing Base Required for Potential Re-determination of Borrowing Base, Minimum | ' | 10.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Subsidiary of Limited Liability Company or Limited Partnership, Ownership Interest | 100.00% | ' | ' | ' | 100.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Debt Instrument, Basis Spread on Variable LIBOR Rate Low End | ' | 1.75% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Debt Instrument, Basis Spread on Variable LIBOR Rate High End | ' | 2.75% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Debt Instrument, Basis Spread on Variable Fed Funds Rate | ' | 0.50% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Debt Instrument, Incremental LIBOR spread on Alternate Base Rate | ' | 1.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Debt Instrument, Basis Spread on Variable Rate Low End | ' | 0.75% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Debt Instrument, Basis Spread on Variable Rate High End | ' | 1.75% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Amount of Subordinated Notes Allowable under Current Credit Facility | ' | ' | 750,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Percentage Reduction in Borrowing Base relative to Senior Debt Issuance | ' | ' | 25.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Percentage Reduction in Borrowing Base relative to New Debt Issuance | ' | ' | 25.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Debt Instrument, Face Amount | ' | ' | ' | ' | ' | ' | ' | 250,000,000 | 0 | ' | 550,000,000 | ' | ' | 300,000,000 | ' | 300,000,000 | ' | ' | ' | ' | ' | ' | ' |
Allowable subordinated debt remaining | ' | ' | 200,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Line of Credit Facility, Amount Outstanding | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 314,000,000 | 488,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Line of Credit Facility, Interest Rate at Period End | ' | ' | 2.21% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Line of Credit Facility, Remaining Borrowing Capacity | ' | ' | 423,400,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Interest Paid | ' | ' | 9,100,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Ratio of Indebtedness to Earnings Before Interest, Taxes, Depreciation and Amortization | ' | ' | 4 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Ratio of Consolidated Current Assets to Consolidated Current Liabilities, Excluding Non-Cash Assets and Liabilities | ' | ' | 1 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Debt Instrument, Interest Rate, Effective Percentage | ' | ' | ' | ' | ' | ' | 98.41% | ' | ' | ' | ' | ' | ' | ' | ' | ' | 97.85% | ' | ' | ' | ' | ' | ' |
Proceeds from long-term debt | ' | ' | 664,263,000 | 335,000,000 | ' | ' | 240,700,000 | ' | ' | ' | ' | ' | ' | ' | 286,700,000 | ' | ' | ' | ' | ' | ' | ' | ' |
Amortization of Debt Discount (Premium) | ' | ' | ' | ' | ' | ' | ' | $200,000 | ' | ' | ' | ' | ' | $1,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Debt redemption premium | ' | ' | ' | ' | ' | ' | ' | 106.63% | ' | ' | ' | ' | ' | 108.00% | ' | ' | ' | 103.31% | 101.66% | 100.00% | 100.00% | 102.00% | 104.00% |
Percentage of Notes Eligible for Early Redemption | ' | ' | ' | ' | ' | ' | ' | 35.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Premium to Par required at Change of Control | ' | ' | ' | ' | ' | ' | ' | 101.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Acquisitions_Details
Acquisitions (Details) (USD $) | 3 Months Ended | 9 Months Ended | |||||
Share data in Thousands, except Per Share data, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 20, 2012 |
COG 2012 Acquisition [Member] | |||||||
Business Acquisition [Line Items] | ' | ' | ' | ' | ' | ' | ' |
Purchase price | ' | ' | ' | ' | ' | ' | $502,600,000 |
Proved oil and natural gas properties using the successful efforts method of accounting | 2,220,213,000 | ' | 2,220,213,000 | ' | 2,078,961,000 | ' | 495,897,000 |
Unproved properties | 70,849,000 | ' | 70,849,000 | ' | 65,968,000 | ' | 37,994,000 |
Total assets | 1,594,671,000 | ' | 1,594,671,000 | ' | 1,571,926,000 | ' | 533,891,000 |
Future abandonment costs | -173,106,000 | ' | -173,106,000 | ' | -162,183,000 | -120,274,000 | -31,274,000 |
Fair value of net assets acquired | ' | ' | ' | ' | ' | ' | 502,617,000 |
Revenues | ' | 115,819,000 | ' | 369,601,000 | ' | ' | ' |
Net income (loss) | ' | -18,475,000 | ' | 87,883,000 | ' | ' | ' |
Income (loss) per unit b basic and diluted | ' | ($0.32) | ' | $1.54 | ' | ' | ' |
Basic and Diluted | ' | 57,039 | ' | 57,010 | ' | ' | ' |
Revenues | 30,683,000 | ' | 86,548,000 | ' | ' | ' | ' |
Excess of revenues over direct operating expenses | $21,633,000 | ' | $59,128,000 | ' | ' | ' | ' |
Related_Party_Transactions_Det
Related Party Transactions (Details) (USD $) | Sep. 30, 2013 | Dec. 31, 2012 | Sep. 30, 2013 |
acre | acre | Partnership in Which Entity's Chairman and Executive Vice President Own a Noncontrolling Interest [Member] | |
Related Party Transaction [Line Items] | ' | ' | ' |
Related Party Transactions, Noncontrolling Ownership Interest in Third Party by Related Party | ' | ' | 4.16% |
Related Party Transaction, Monthly Rent Expense | ' | ' | $57,170 |
Working Interest Associated with Prospective Acreage | ' | 5.00% | ' |
Prospective acreage acquired in related party transaction | 24,510 | 129,428 | ' |
Prospective Acreage, Actual Purchase Price | $1,200,000 | $7,200,000 | ' |
Fair_Value_Measurements_Detail
Fair Value Measurements (Details) (USD $) | 3 Months Ended | 9 Months Ended | ||||||||
Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | Jun. 30, 2013 | Dec. 31, 2012 | Jun. 30, 2012 | Dec. 31, 2011 | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ||
Debt Instrument, Fair Value Disclosure | $314,000,000 | ' | $314,000,000 | ' | ' | ' | ' | ' | ||
Impairment of long-lived assets | 835,000 | 7,277,000 | 23,352,000 | 22,556,000 | ' | ' | ' | ' | ||
Oil and Gas Property, Successful Effort Method, Net | 1,594,671,000 | ' | 1,594,671,000 | ' | ' | 1,571,926,000 | ' | ' | ||
Fair Value, Measurements, Nonrecurring [Member] | Fair Value, Inputs, Level 1 [Member] | ' | ' | ' | ' | ' | ' | ' | ' | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ||
Oil and Gas Property, Successful Effort Method, Net | 0 | [1] | ' | 0 | [1] | ' | ' | ' | ' | ' |
Fair Value of Assets Acquired | ' | ' | 0 | [2] | ' | ' | ' | ' | ' | |
Fair Value of nonrecurring assets (liabilities) recognized at fair value | ' | ' | 0 | ' | ' | ' | ' | ' | ||
Fair Value, Measurements, Nonrecurring [Member] | Fair Value, Inputs, Level 2 [Member] | ' | ' | ' | ' | ' | ' | ' | ' | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ||
Oil and Gas Property, Successful Effort Method, Net | 0 | [1] | ' | 0 | [1] | ' | ' | ' | ' | ' |
Fair Value of Assets Acquired | ' | ' | 0 | [2] | ' | ' | ' | ' | ' | |
Fair Value of nonrecurring assets (liabilities) recognized at fair value | ' | ' | 0 | ' | ' | ' | ' | ' | ||
Fair Value, Measurements, Nonrecurring [Member] | Fair Value, Inputs, Level 3 [Member] | ' | ' | ' | ' | ' | ' | ' | ' | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ||
Impairment of long-lived assets | ' | ' | 23,400,000 | ' | ' | ' | ' | ' | ||
Oil and Gas Property, Successful Effort Method, Gross | 50,900,000 | ' | 50,900,000 | ' | ' | ' | ' | ' | ||
Oil and Gas Property, Successful Effort Method, Net | 27,553,000 | [1] | ' | 27,553,000 | [1] | ' | ' | ' | ' | ' |
Fair Value of Assets Acquired | ' | ' | 95,369,000 | [2] | ' | ' | ' | ' | ' | |
Fair Value of nonrecurring assets (liabilities) recognized at fair value | ' | ' | 122,922,000 | ' | ' | ' | ' | ' | ||
Number of Businesses Acquired | ' | ' | 12 | ' | ' | ' | ' | ' | ||
Fair Value, Measurements, Recurring [Member] | ' | ' | ' | ' | ' | ' | ' | ' | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ||
Deferred Compensation Share-based Arrangements, Liability, Current | -2,085,000 | [3] | ' | -2,085,000 | [3] | ' | ' | ' | ' | ' |
Oil and gas swap derivative, net | -3,763,000 | ' | -3,763,000 | ' | ' | ' | ' | ' | ||
Oil and Gas Collar Derivative, Net | 14,478,000 | ' | 14,478,000 | ' | ' | ' | ' | ' | ||
Interest Rate Derivative Liabilities, at Fair Value | -5,690,000 | ' | -5,690,000 | ' | ' | ' | ' | ' | ||
Net Assets (Liabilities), Fair Value Disclosure, Recurring | 2,940,000 | ' | 2,940,000 | ' | ' | ' | ' | ' | ||
Fair Value, Measurements, Recurring [Member] | Fair Value, Inputs, Level 1 [Member] | ' | ' | ' | ' | ' | ' | ' | ' | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ||
Deferred Compensation Share-based Arrangements, Liability, Current | 0 | [3] | ' | 0 | [3] | ' | ' | ' | ' | ' |
Oil and gas swap derivative, net | 0 | ' | 0 | ' | ' | ' | ' | ' | ||
Oil and Gas Collar Derivative, Net | 0 | ' | 0 | ' | ' | ' | ' | ' | ||
Interest Rate Derivative Liabilities, at Fair Value | 0 | ' | 0 | ' | ' | ' | ' | ' | ||
Net Assets (Liabilities), Fair Value Disclosure, Recurring | 0 | ' | 0 | ' | ' | ' | ' | ' | ||
Fair Value, Measurements, Recurring [Member] | Fair Value, Inputs, Level 2 [Member] | ' | ' | ' | ' | ' | ' | ' | ' | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ||
Deferred Compensation Share-based Arrangements, Liability, Current | -2,085,000 | [3] | ' | -2,085,000 | [3] | ' | ' | ' | ' | ' |
Oil and gas swap derivative, net | -12,360,000 | ' | -12,360,000 | ' | ' | ' | ' | ' | ||
Oil and Gas Collar Derivative, Net | 0 | ' | 0 | ' | ' | ' | ' | ' | ||
Interest Rate Derivative Liabilities, at Fair Value | -5,690,000 | ' | -5,690,000 | ' | ' | ' | ' | ' | ||
Net Assets (Liabilities), Fair Value Disclosure, Recurring | -20,135,000 | ' | -20,135,000 | ' | ' | ' | ' | ' | ||
Fair Value, Measurements, Recurring [Member] | Fair Value, Inputs, Level 3 [Member] | ' | ' | ' | ' | ' | ' | ' | ' | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ||
Fair Value, Measurement with Unobservable Inputs Reconciliation, Recurring Basis, Asset Value | 23,075,000 | 28,516,000 | 23,075,000 | 28,516,000 | 32,386,000 | 29,966,000 | 41,851,000 | 30,054,000 | ||
Deferred Compensation Share-based Arrangements, Liability, Current | 0 | [3] | ' | 0 | [3] | ' | ' | ' | ' | ' |
Oil and gas swap derivative, net | 8,597,000 | ' | 8,597,000 | ' | ' | ' | ' | ' | ||
Oil and Gas Collar Derivative, Net | 14,478,000 | ' | 14,478,000 | ' | ' | ' | ' | ' | ||
Interest Rate Derivative Liabilities, at Fair Value | 0 | ' | 0 | ' | ' | ' | ' | ' | ||
Net Assets (Liabilities), Fair Value Disclosure, Recurring | 23,075,000 | ' | 23,075,000 | ' | ' | ' | ' | ' | ||
Fair Value, Measurement with Unobservable Inputs Reconciliation, Recurring Basis, Asset, Gain (Loss) Included in Earnings | -8,788,000 | -8,111,000 | -2,475,000 | 13,260,000 | ' | ' | ' | ' | ||
Fair Value, Measurement with Unobservable Inputs Reconciliation, Recurring Basis, Asset, Settlements | -523,000 | -5,224,000 | -4,416,000 | -14,798,000 | ' | ' | ' | ' | ||
Fair Value, Option, Changes in Fair Value, Gain (Loss) | -9,311,000 | -13,335,000 | -6,891,000 | -1,538,000 | ' | ' | ' | ' | ||
6.625% Senior Notes [Member] | ' | ' | ' | ' | ' | ' | ' | ' | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ||
Notes Payable, Fair Value Disclosure | 235,900,000 | ' | 235,900,000 | ' | ' | ' | ' | ' | ||
8% Senior Notes [Member] | ' | ' | ' | ' | ' | ' | ' | ' | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ||
Notes Payable, Fair Value Disclosure | $304,500,000 | ' | $304,500,000 | ' | ' | ' | ' | ' | ||
[1] | Legacy utilizes ASC 360-10-35 to periodically review oil and natural gas properties for impairment when facts and circumstances indicate that their carrying value may not be recoverable. Legacy compares net capitalized costs of proved oil and natural gas properties to estimated undiscounted future net cash flows using managementbs expectations of future oil and natural gas prices. These future price scenarios reflect Legacybs estimation of future price volatility. During the nine-month period ended SeptemberB 30, 2013, Legacy incurred impairment charges of $23.4 million as oil and natural gas properties with a net cost basis of $50.9 million were written down to their fair value of $27.5 million. In order to determine fair value, Legacy compares net capitalized costs of proved oil and natural gas properties to estimated undiscounted future net cash flows using managementbs expectations of future oil and natural gas prices. These future price scenarios reflect Legacybs estimation of future price volatility. If the net capitalized cost exceeds the undiscounted future net cash flows, Legacy writes the net cost basis down to the discounted future net cash flows, which is management's estimate of fair value. Significant inputs used to determine the fair value include estimates of: (i) reserves; (ii) future operating and development costs; (iii) future commodity prices; and (iv) a market-based weighted average cost of capital rate. The underlying commodity prices embedded in the Company's estimated cash flows are the product of a process that begins with NYMEX forward curve pricing, adjusted for estimated location and quality differentials, as well as other factors that Legacy's management believes will impact realizable prices. The inputs used by management for the fair value measurements utilized in this review include significant unobservable inputs, and therefore, the fair value measurements employed are classified as Level 3 for these types of assets. | |||||||||
[2] | Legacy utilizes ASC 805-10 to identify and record the fair value of assets and liabilities acquired in a business combination. During the nine-month period ended SeptemberB 30, 2013, Legacy acquired oil and natural gas properties, inclusive of unproved acreage acquisitions, with a fair value of $95.4 million in 12 individually immaterial transactions. Properties acquired are recorded at fair value, which correlates to the discounted future net cash flow. Significant inputs used to determine the fair value include estimates of: (i) reserves; (ii) future operating and development costs; (iii) future commodity prices; and (iv) a market-based weighted average cost of capital rate. The underlying commodity prices embedded in the Company's estimated cash flows are the product of a process that begins with NYMEX forward curve pricing, adjusted for estimated location and quality differentials, as well as other factors that Legacy's management believes will impact realizable prices. For acquired unproved properties, the market-based weighted average cost of capital rate is subjected to additional project specific risking factors. The inputs used by management for the fair value measurements of these acquired oil and natural gas properties include significant unobservable inputs, and therefore, the fair value measurements employed are classified as Level 3 for these types of assets. | |||||||||
[3] | See Note 10 for further discussion on unit-based compensation expenses and the related LTIP liability for certain grants accounted for under the liability method. |
Derivative_Financial_Instrumen2
Derivative Financial Instruments (Details) (USD $) | 3 Months Ended | 9 Months Ended | ||
In Thousands, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 |
Derivative [Line Items] | ' | ' | ' | ' |
Beginning fair value of commodity derivatives | $35,187 | $56,907 | $24,148 | ($8,443) |
Total gain (loss) - oil/natural gas derivatives | ' | ' | -14,241 | 35,141 |
Oil derivative cash settlements paid (received) | 8,006 | -2,108 | 9,711 | 10,948 |
Natural gas derivative cash settlements received | -2,054 | -4,000 | -5,046 | -12,967 |
Ending fair value of commodity derivatives | 10,715 | 23,622 | 10,715 | 23,622 |
Settlements received from paid on derivatives not designated as hedges | ' | ' | -4,666 | 2,018 |
Libor Swap Tranche One [Member] | ' | ' | ' | ' |
Derivative [Line Items] | ' | ' | ' | ' |
Notional Amount | 29,000 | ' | 29,000 | ' |
Derivative, Average Fixed Interest Rate | 3.07% | ' | 3.07% | ' |
Beginning Effective Date of Interest Rate Derivative | ' | ' | 16-Oct-07 | ' |
Interest Rate Derivative Maturity Date | ' | ' | 16-Oct-15 | ' |
Interest Rate Derivative Liabilities, at Fair Value | -1,579 | ' | -1,579 | ' |
Three-Way Oil Collar Due Current Year [Member] | ' | ' | ' | ' |
Derivative [Line Items] | ' | ' | ' | ' |
Derivative, Nonmonetary Notional Amount | 315,560 | ' | 315,560 | ' |
Average Short Put on a three-way oil collar | 66.34 | ' | 66.34 | ' |
Average Long Put on aThree-Way Oil Collar | 91.56 | ' | 91.56 | ' |
Derivative, Average Cap Price | 108.15 | ' | 108.15 | ' |
Oil Collar Derivative [Member] | ' | ' | ' | ' |
Derivative [Line Items] | ' | ' | ' | ' |
Derivative, Nonmonetary Notional Amount | 736,000 | ' | 736,000 | ' |
Derivative, Average Forward Price | -1.47 | ' | -1.47 | ' |
Derivative Swap Fixed Price Range, Low | -1.25 | ' | -1.25 | ' |
Derivative Swap Fixed Price Range, High | -1.75 | ' | -1.75 | ' |
oil commodity derivatives [Member] | ' | ' | ' | ' |
Derivative [Line Items] | ' | ' | ' | ' |
Total gain (loss) - oil/natural gas derivatives | -31,151 | -24,088 | -18,942 | 32,962 |
Natural gas commodity derivatives [Member] | ' | ' | ' | ' |
Derivative [Line Items] | ' | ' | ' | ' |
Total gain (loss) - oil/natural gas derivatives | 727 | -3,089 | 844 | 1,122 |
Three-Way Oil Collar Due Year Two [Member] | ' | ' | ' | ' |
Derivative [Line Items] | ' | ' | ' | ' |
Derivative, Nonmonetary Notional Amount | 1,818,880 | ' | 1,818,880 | ' |
Average Short Put on a three-way oil collar | 66.43 | ' | 66.43 | ' |
Average Long Put on aThree-Way Oil Collar | 91.58 | ' | 91.58 | ' |
Derivative, Average Cap Price | 108.62 | ' | 108.62 | ' |
Three-Way Oil Collar Due Year Three [Member] | ' | ' | ' | ' |
Derivative [Line Items] | ' | ' | ' | ' |
Derivative, Nonmonetary Notional Amount | 365,000 | ' | 365,000 | ' |
Derivative, Average Forward Price | 92.35 | ' | 92.35 | ' |
Average Short Put on a three-way oil collar | 80 | ' | 80 | ' |
Average Long Put on aThree-Way Oil Collar | 60 | ' | 60 | ' |
Three-Way Oil Collar Due Year Four [Member] | ' | ' | ' | ' |
Derivative [Line Items] | ' | ' | ' | ' |
Derivative, Nonmonetary Notional Amount | 183,000 | ' | 183,000 | ' |
Derivative, Average Forward Price | 91.7 | ' | 91.7 | ' |
Average Short Put on a three-way oil collar | 82 | ' | 82 | ' |
Average Long Put on aThree-Way Oil Collar | 57 | ' | 57 | ' |
Three-Way Oil Collar Due Year Five [Member] | ' | ' | ' | ' |
Derivative [Line Items] | ' | ' | ' | ' |
Derivative, Nonmonetary Notional Amount | 182,500 | ' | 182,500 | ' |
Derivative, Average Forward Price | 90.85 | ' | 90.85 | ' |
Average Short Put on a three-way oil collar | 82 | ' | 82 | ' |
Average Long Put on aThree-Way Oil Collar | 57 | ' | 57 | ' |
Libor Swap Tranche Two [Member] | ' | ' | ' | ' |
Derivative [Line Items] | ' | ' | ' | ' |
Notional Amount | 13,000 | ' | 13,000 | ' |
Derivative, Average Fixed Interest Rate | 3.11% | ' | 3.11% | ' |
Beginning Effective Date of Interest Rate Derivative | ' | ' | 16-Nov-07 | ' |
Interest Rate Derivative Maturity Date | ' | ' | 16-Nov-15 | ' |
Interest Rate Derivative Liabilities, at Fair Value | -750 | ' | -750 | ' |
Libor Swap Tranche Three [Member] | ' | ' | ' | ' |
Derivative [Line Items] | ' | ' | ' | ' |
Notional Amount | 12,000 | ' | 12,000 | ' |
Derivative, Average Fixed Interest Rate | 3.13% | ' | 3.13% | ' |
Beginning Effective Date of Interest Rate Derivative | ' | ' | 28-Nov-07 | ' |
Interest Rate Derivative Maturity Date | ' | ' | 28-Nov-15 | ' |
Interest Rate Derivative Liabilities, at Fair Value | -684 | ' | -684 | ' |
Libor Swap Tranche Five [Member] | ' | ' | ' | ' |
Derivative [Line Items] | ' | ' | ' | ' |
Notional Amount | 50,000 | ' | 50,000 | ' |
Derivative, Average Fixed Interest Rate | 3.10% | ' | 3.10% | ' |
Beginning Effective Date of Interest Rate Derivative | ' | ' | 10-Oct-08 | ' |
Interest Rate Derivative Maturity Date | ' | ' | 10-Oct-13 | ' |
Interest Rate Derivative Liabilities, at Fair Value | -122 | ' | -122 | ' |
Libor Swap Tranche Six [Member] | ' | ' | ' | ' |
Derivative [Line Items] | ' | ' | ' | ' |
Notional Amount | 50,000 | ' | 50,000 | ' |
Derivative, Average Fixed Interest Rate | 0.71% | ' | 0.71% | ' |
Beginning Effective Date of Interest Rate Derivative | ' | ' | 10-Aug-11 | ' |
Interest Rate Derivative Maturity Date | ' | ' | 10-Aug-14 | ' |
Interest Rate Derivative Liabilities, at Fair Value | -82 | ' | -82 | ' |
Libor Swap Tranche Seven [Member] | ' | ' | ' | ' |
Derivative [Line Items] | ' | ' | ' | ' |
Notional Amount | 50,000 | ' | 50,000 | ' |
Derivative, Average Fixed Interest Rate | 2.30% | ' | 2.30% | ' |
Beginning Effective Date of Interest Rate Derivative | ' | ' | 18-Dec-08 | ' |
Interest Rate Derivative Maturity Date | ' | ' | 18-Dec-13 | ' |
Interest Rate Derivative Liabilities, at Fair Value | -257 | ' | -257 | ' |
Libor Swap Tranche Eight [Member] | ' | ' | ' | ' |
Derivative [Line Items] | ' | ' | ' | ' |
Notional Amount | 50,000 | ' | 50,000 | ' |
Derivative, Average Fixed Interest Rate | 0.70% | ' | 0.70% | ' |
Beginning Effective Date of Interest Rate Derivative | ' | ' | 10-Aug-11 | ' |
Interest Rate Derivative Maturity Date | ' | ' | 10-Aug-14 | ' |
Interest Rate Derivative Liabilities, at Fair Value | -79 | ' | -79 | ' |
Libor Swap Tranche Nine [Member] | ' | ' | ' | ' |
Derivative [Line Items] | ' | ' | ' | ' |
Notional Amount | 50,000 | ' | 50,000 | ' |
Derivative, Average Fixed Interest Rate | 2.50% | ' | 2.50% | ' |
Beginning Effective Date of Interest Rate Derivative | ' | ' | 10-Oct-08 | ' |
Interest Rate Derivative Maturity Date | ' | ' | 10-Oct-15 | ' |
Interest Rate Derivative Liabilities, at Fair Value | -2,137 | ' | -2,137 | ' |
Libor Swap All Tranches [Member] | ' | ' | ' | ' |
Derivative [Line Items] | ' | ' | ' | ' |
Interest Rate Derivative Liabilities, at Fair Value | -5,690 | ' | -5,690 | ' |
Enhanced Oil Swap Due Year Six [Member] | ' | ' | ' | ' |
Derivative [Line Items] | ' | ' | ' | ' |
Derivative, Nonmonetary Notional Amount | 127,750 | ' | 127,750 | ' |
Derivative, Average Forward Price | 90.5 | ' | 90.5 | ' |
Average Short Put on a three-way oil collar | 82 | ' | 82 | ' |
Average Long Put on aThree-Way Oil Collar | 57 | ' | 57 | ' |
Three-Way Oil Collar Due Year Three [Member] | ' | ' | ' | ' |
Derivative [Line Items] | ' | ' | ' | ' |
Derivative, Nonmonetary Notional Amount | 1,308,500 | ' | 1,308,500 | ' |
Average Short Put on a three-way oil collar | 64.67 | ' | 64.67 | ' |
Average Long Put on aThree-Way Oil Collar | 89.67 | ' | 89.67 | ' |
Derivative, Average Cap Price | 112.21 | ' | 112.21 | ' |
Three-Way Oil Collar Due Year Four [Member] | ' | ' | ' | ' |
Derivative [Line Items] | ' | ' | ' | ' |
Derivative, Nonmonetary Notional Amount | 621,300 | ' | 621,300 | ' |
Average Short Put on a three-way oil collar | 63.37 | ' | 63.37 | ' |
Average Long Put on aThree-Way Oil Collar | 88.37 | ' | 88.37 | ' |
Derivative, Average Cap Price | 106.4 | ' | 106.4 | ' |
Three-Way Oil Collar Due Year Five [Member] | ' | ' | ' | ' |
Derivative [Line Items] | ' | ' | ' | ' |
Derivative, Nonmonetary Notional Amount | 72,400 | ' | 72,400 | ' |
Average Short Put on a three-way oil collar | 60 | ' | 60 | ' |
Average Long Put on aThree-Way Oil Collar | 85 | ' | 85 | ' |
Derivative, Average Cap Price | 104.2 | ' | 104.2 | ' |
Gas Swaps Due Current Year [Member] | ' | ' | ' | ' |
Derivative [Line Items] | ' | ' | ' | ' |
Derivative, Nonmonetary Notional Amount | 2,467,851 | ' | 2,467,851 | ' |
Derivative, Average Forward Price | 4.33 | ' | 4.33 | ' |
Derivative Swap Fixed Price Range, Low | 3.23 | ' | 3.23 | ' |
Derivative Swap Fixed Price Range, High | 6.89 | ' | 6.89 | ' |
Oil Swaps Due Current Year [Member] | ' | ' | ' | ' |
Derivative [Line Items] | ' | ' | ' | ' |
Derivative, Nonmonetary Notional Amount | 620,854 | ' | 620,854 | ' |
Derivative, Average Forward Price | 92.9 | ' | 92.9 | ' |
Derivative Swap Fixed Price Range, Low | 80.1 | ' | 80.1 | ' |
Derivative Swap Fixed Price Range, High | 107.2 | ' | 107.2 | ' |
Oil Swaps Due Year Two [Member] | ' | ' | ' | ' |
Derivative [Line Items] | ' | ' | ' | ' |
Derivative, Nonmonetary Notional Amount | 1,776,264 | ' | 1,776,264 | ' |
Derivative, Average Forward Price | 91.67 | ' | 91.67 | ' |
Derivative Swap Fixed Price Range, Low | 87.5 | ' | 87.5 | ' |
Derivative Swap Fixed Price Range, High | 103.75 | ' | 103.75 | ' |
Oil Swaps Due Year Three [Member] | ' | ' | ' | ' |
Derivative [Line Items] | ' | ' | ' | ' |
Derivative, Nonmonetary Notional Amount | 545,351 | ' | 545,351 | ' |
Derivative, Average Forward Price | 91.98 | ' | 91.98 | ' |
Derivative Swap Fixed Price Range, Low | 88.5 | ' | 88.5 | ' |
Derivative Swap Fixed Price Range, High | 100.2 | ' | 100.2 | ' |
Oil Swaps Due Year Four [Member] | ' | ' | ' | ' |
Derivative [Line Items] | ' | ' | ' | ' |
Derivative, Nonmonetary Notional Amount | 228,600 | ' | 228,600 | ' |
Derivative, Average Forward Price | 87.94 | ' | 87.94 | ' |
Derivative Swap Fixed Price Range, Low | 86.3 | ' | 86.3 | ' |
Derivative Swap Fixed Price Range, High | 99.85 | ' | 99.85 | ' |
Oil Swaps Due Year Five [Member] | ' | ' | ' | ' |
Derivative [Line Items] | ' | ' | ' | ' |
Derivative, Nonmonetary Notional Amount | 182,500 | ' | 182,500 | ' |
Derivative, Average Forward Price | 84.75 | ' | 84.75 | ' |
Derivative Swap Fixed Price Range, Low | 84.75 | ' | 84.75 | ' |
Gas Swaps Due Year Two [Member] | ' | ' | ' | ' |
Derivative [Line Items] | ' | ' | ' | ' |
Derivative, Nonmonetary Notional Amount | 8,271,254 | ' | 8,271,254 | ' |
Derivative, Average Forward Price | 4.32 | ' | 4.32 | ' |
Derivative Swap Fixed Price Range, Low | 3.61 | ' | 3.61 | ' |
Derivative Swap Fixed Price Range, High | 6.47 | ' | 6.47 | ' |
Gas Swaps Due Year Three [Member] | ' | ' | ' | ' |
Derivative [Line Items] | ' | ' | ' | ' |
Derivative, Nonmonetary Notional Amount | 1,339,300 | ' | 1,339,300 | ' |
Derivative, Average Forward Price | 5.65 | ' | 5.65 | ' |
Derivative Swap Fixed Price Range, Low | 5.14 | ' | 5.14 | ' |
Derivative Swap Fixed Price Range, High | 5.82 | ' | 5.82 | ' |
Gas Swaps Due Year Four [Member] | ' | ' | ' | ' |
Derivative [Line Items] | ' | ' | ' | ' |
Derivative, Nonmonetary Notional Amount | 219,200 | ' | 219,200 | ' |
Derivative, Average Forward Price | 5.3 | ' | 5.3 | ' |
Derivative Swap Fixed Price Range, Low | 5.3 | ' | 5.3 | ' |
Interest Rate Swap [Member] | ' | ' | ' | ' |
Derivative [Line Items] | ' | ' | ' | ' |
Settlements received from paid on derivatives not designated as hedges | 1,436 | 1,768 | 4,786 | 5,244 |
Unrealized change in fair value - interest rate swaps | 788 | 301 | 3,857 | 1,057 |
Total Interest Rate Derivative Impact on Earnings | $648 | $1,467 | $929 | $4,187 |
Asset_Retirement_Obligation_De
Asset Retirement Obligation (Details) (USD $) | 9 Months Ended | 12 Months Ended | |
In Thousands, unless otherwise specified | Sep. 30, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
Asset Retirement Obligations [Line Items] | ' | ' | ' |
Asset retirement obligation - beginning of period | $173,106 | $162,183 | $120,274 |
Liabilities settled during the period | -1,891 | -2,412 | ' |
Liabilities associated with properties sold | -1,590 | 0 | ' |
Current period accretion | 4,551 | 4,586 | ' |
Asset retirement obligation - end of period | 173,106 | 162,183 | 120,274 |
Liabilities Incurred due to properties acquired [Member] | ' | ' | ' |
Asset Retirement Obligations [Line Items] | ' | ' | ' |
Liabilities incurred with properties | 9,853 | 38,857 | ' |
Liabilities Incurred due to drilling activity [Member] | ' | ' | ' |
Asset Retirement Obligations [Line Items] | ' | ' | ' |
Liabilities incurred with properties | $0 | $878 | ' |
Earnings_Per_Unit_Details
Earnings Per Unit (Details) (USD $) | 3 Months Ended | 9 Months Ended | ||
In Thousands, except Share data, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 |
Earnings Per Unit [Abstract] | ' | ' | ' | ' |
Income (loss) available to unitholders | ($3,422) | ($23,566) | $11,627 | $66,765 |
Weighted average number of units outstanding | 57,275,000 | 47,869,000 | 57,200,000 | 47,840,000 |
Restricted and phantom units | 0 | 0 | 95,000 | 0 |
Weighted average units and potential units outstanding | 57,275,000 | 47,869,000 | 57,295,000 | 47,840,000 |
Basic and diluted earnings (loss) per unit | ($0.06) | ($0.49) | $0.20 | $1.40 |
Antidilutive securities excluded from computation of EPS | 425,195 | ' | 330,116 | 227,477 |
Unit_Based_Compensation_Detail
Unit Based Compensation (Details) (USD $) | 9 Months Ended | 9 Months Ended | 12 Months Ended | 9 Months Ended | 9 Months Ended | 12 Months Ended | 9 Months Ended | 12 Months Ended | 9 Months Ended | 12 Months Ended | 9 Months Ended | 12 Months Ended | 9 Months Ended | 12 Months Ended | ||||||||
Sep. 30, 2013 | Sep. 30, 2012 | Dec. 31, 2012 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Dec. 31, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2013 | Dec. 31, 2012 | Sep. 30, 2013 | Dec. 31, 2012 | Sep. 30, 2013 | Dec. 31, 2012 | Sep. 30, 2013 | Dec. 31, 2012 | Sep. 30, 2013 | Dec. 31, 2012 | Dec. 31, 2012 | |
Years | Stock Options [Member] | Stock Appreciation Rights (SARs) [Member] | Stock Appreciation Rights (SARs) [Member] | Restricted Stock [Member] | Restricted Stock [Member] | Phantom Unit [Member] | Phantom Unit [Member] | Unrestricted Unit [Member] | Unit Appreciation Right Three Year Ratable Vest [Member] | Unit Appreciation Right Three Year Ratable Vest [Member] | Unit Appreciation Right Three Year Cliff Vest [Member] | Unit Appreciation Right Three Year Cliff Vest [Member] | Executive Subjective Phantom Units [Member] | Executive Subjective Phantom Units [Member] | Executive Objective Phantom Units [Member] | Executive Objective Phantom Units [Member] | Executive Officer [Member] | Executive Officer [Member] | Executive Officer [Member] | |||
Years | ||||||||||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Share-based Compensation Arrangement, Liability Method, Risk-free rate | 1.40% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Share-based Compensation Arrangement by Share-based Payment Award, Options and Equity Instruments Other than Options, Nonvested, Number | 379,889 | ' | 347,650 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Number | 615,043 | ' | 516,219 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Share-based Compensation Arrangement by Share-based Payment Award, Number of Shares Authorized | 2,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Share-based Compensation Arrangement, Number of Shares Granted | 1,626,924 | ' | ' | 266,014 | 615,043 | ' | 438,486 | ' | 195,143 | ' | 112,238 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Gross | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 123,650 | 82,400 | 74,506 | 60,336 | ' | ' | ' | ' | ' | ' | ' |
Allocated Share-based Compensation Expense | $1,700,000 | $1,200,000 | ' | ' | $700,000 | $500,000 | ' | ' | $700,000 | $1,500,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Employee Service Share-based Compensation, Nonvested Awards, Total Compensation Cost Not yet Recognized | ' | ' | ' | ' | 1,600,000 | ' | 5,400,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Share Based Compensation, Unrecognized Compensation Expense, Years Remaining | 2.8 | ' | ' | ' | 2.3 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Long-Duration Contracts, Assumptions by Product and Guarantee, Volatility Rate | 51.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Share based compensation, forfeiture rate | 3.70% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Share Based Compensation, Assumed Dividend Rate | $2.32 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Weighted Average Exercise Price | $25.86 | ' | $24.71 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Weighted Average Remaining Contractual Term | '5 years 3 months | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Grants in Period | 198,156 | ' | ' | ' | ' | ' | 84,528 | 173,645 | ' | ' | ' | ' | ' | ' | ' | 46,430 | 30,828 | 76,723 | 57,189 | 3,715 | 3,509 | 2,500 |
Share-based Compensation Arrangement, Unrestricted Units, Unit price on date of Grant | $27.39 | ' | $28.34 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Weighted Average Exercise Price | $26.41 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Exercises in Period | -83,666 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Exercises in Period, Weighted Average Exercise Price | $19.92 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Forfeitures in Period | -15,666 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Forfeitures in Period, Weighted Average Exercise Price | $26.46 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Weighted Average Remaining Contractual Term | '5 years 6 months 8 days | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Intrinsic Value | 1,063,605 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Exercisable, Number | 235,154 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Exercisable, Weighted Average Exercise Price | $23.63 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Share-based Compensation Arrangement, Options, Remaining Contractual Term, Options Exercisable | '3 years 11 months | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Exercisable, Intrinsic Value | $897,780 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Share-based Compensation Arrangement by Share-based Payment Award, Options and Equity Instruments Other than Options, Nonvested, Weighted Average Exercise Price | $27.25 | ' | $26.73 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Share-based Compensation Arrangement, Nonvested Option Grants | 198,156 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Share-based Compensation Arrangement, Nonvested Option Grants Weighted Average Strike Price | $26.41 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Share-based Compensation Arrangement, Nonvested Options, Vested Unexercised | -151,917 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Share-based Compensation Arrangement, Nonvested Options, Vested Unexercised Weighted Average Exercise Price | $24.96 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Share-based Compensation Arrangement, Nonvested Options, Forfeitures | -14,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Share-based Compensation Arrangement, Nonvested Options, Forfeitures, Weighted Average Exercise Price | $27.35 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Percentage of Vesting Amount, Each Step | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 50.00% | ' | ' | ' | ' |
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Number | 236,052 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Subsequent_Events_Details
Subsequent Events (Details) (USD $) | Oct. 15, 2013 | Sep. 30, 2013 | Mar. 10, 2011 | Nov. 14, 2013 |
In Millions, except Per Share data, unless otherwise specified | Dividend Declared [Member] | |||
Subsequent Event [Line Items] | ' | ' | ' | ' |
Distributions to unitholders (in dollars per share) | ' | $1.73 | ' | $0.59 |
Distribution Increase over prior distribution | ' | ' | ' | $0.01 |
Line of Credit Facility, Current Borrowing Capacity | $800 | ' | $737.50 | ' |