Range Resources (RRC) 10-Q 23 Jul 09 2009 Q2 Quarterly report Financial data

Document and Company Informatio

Document and Company Information (USD $)
	6 Months Ended Jun. 30, 2009	Jul. 20, 2009	Jun. 30, 2008
Document And Entity Information [Abstract]
Entity Registrant Name	RANGE RESOURCES CORPORATION
Entity Central Index Key	0000315852
Document Type	10-Q
Document Period End Date	2009-06-30
Amendment Flag	false
Amendment Description	No
Company Fiscal Year End Date	--12-31
Entity Well Known Seasoned Issuer	Yes
Entity Voluntary Filers	No
Entity Current Reporting Status	Yes
Entity Filer Category	Large Accelerated Filer
Entity Public Float			$9,963,751,000
Entity Common Stock Shares Outstanding		157,255,568

Consolidated Balance Sheets

Consolidated Balance Sheets (USD $)
In Thousands	Jun. 30, 2009	Dec. 31, 2008
Current assets:
Cash and equivalents	$2,152	$753
Accounts receivable, less allowance for doubtful accounts of $753 and $954	99,065	162,201
Unrealized derivative gain	169,856	221,430
Inventory and other	22,179	19,927
Total current assets	293,252	404,311
Unrealized derivative gain	0	5,231
Equity method investments	150,979	147,126
Oil and gas properties, successful efforts method	6,161,834	6,028,980
Accumulated depletion and depreciation	(1,337,153)	(1,186,934)
Oil and gas properties, successful efforts method, net	4,824,681	4,842,046
Transportation and field assets	157,066	142,662
Accumulated depreciation and amortization	(65,114)	(56,434)
Transportation and field assets, net	91,952	86,228
Other assets	75,135	66,937
Total assets	5,435,999	5,551,879
Current liabilities:
Accounts payable	131,436	250,640
Asset retirement obligations	2,064	2,055
Accrued liabilities	54,234	47,309
Deferred tax liability	23,986	32,984
Accrued interest	23,134	20,516
Unrealized derivative loss	2,412	10
Total current liabilities	237,266	353,514
Bank debt	403,000	693,000
Subordinated notes and other long term debt	1,383,134	1,097,668
Deferred tax liability	773,277	779,218
Unrealized derivative loss	2,534	0
Deferred compensation liability	109,730	93,247
Asset retirement obligations and other liabilities	84,232	83,890
Stockholders' Equity
Preferred stock, $1 par, 10,000,000 shares authorized, none issued and outstanding	0	0
Common stock, $0.01 par, 475,000,000 shares authorized, 157,255,400 issued at June 30, 2009 and 155,609,387 issued at December 31, 2008	1,573	1,556
Common stock held in treasury, 233,900 shares at June 30, 2009 and December 31, 2008	(8,557)	(8,557)
Additional paid-in capital	1,729,190	1,695,268
Retained earnings	665,752	685,568
Accumulated other comprehensive income	54,868	77,507
Total stockholders' equity	2,442,826	2,451,342
Total liabilities and stockholders' equity	$5,435,999	$5,551,879

Consolidated Balance Sheets (Pa

Consolidated Balance Sheets (Parenthetical) (USD $)
In Thousands, except Share data	Jun. 30, 2009	Dec. 31, 2008
Allowance for doubtful accounts on accounts recievables	$753	$954
Preferred stock, par value	1	1
Preferred stock, shares authorized	10,000,000	10,000,000
Preferred stock, shares issued	0	0
Preferred stock, shares outstanding	0	0
Common stock, par value	0.01	0.01
Common stock, shares authorized	475,000,000	475,000,000
Common stock, shares issued	157,255,400	155,609,387
Common stock held in treasury shares	233,900	233,900

Consolidated Statements of Oper

Consolidated Statements of Operations (USD $)
In Thousands, except Per Share data	3 Months Ended Jun. 30, 2009	3 Months Ended Jun. 30, 2008	6 Months Ended Jun. 30, 2009	6 Months Ended Jun. 30, 2008
Revenues
Oil and gas sales	$192,523	$347,622	$395,712	$655,006
Transportation and gathering	2,152	1,224	1,647	2,353
Derivative fair value (loss) income	(9,856)	(196,684)	65,691	(320,451)
Other	(4,387)	(359)	(6,181)	20,233
Total revenue	180,432	151,803	456,869	357,141
Costs and expenses
Direct operating	34,828	37,228	70,369	70,178
Production and ad valorem taxes	7,564	16,056	15,821	29,896
Exploration	11,368	19,462	24,707	36,055
Abandonment and impairment of unproved properties	40,954	3,474	60,526	5,598
General and administrative	29,103	23,938	54,013	41,350
Deferred compensation plan	756	7,539	13,190	28,150
Interest expense	29,555	23,842	56,184	46,988
Depletion, depreciation and amortization	88,713	72,115	173,033	142,248
Total costs and expenses	242,841	203,654	467,843	400,463
Loss from operations	(62,409)	(51,851)	(10,974)	(43,322)
Income tax expense (benefit)
Current	619	949	619	1,835
Deferred	(23,145)	(20,445)	(4,318)	(17,651)
Total income tax benefit	(22,526)	(19,496)	(3,699)	(15,816)
Net loss	($39,883)	($32,355)	($7,275)	($27,506)
Loss per common share:
Basic	-0.26	-0.22	-0.05	-0.18
Diluted	-0.26	-0.22	-0.05	-0.18
Dividends per common share	0.04	0.04	0.08	0.08
Weighted average common shares outstanding:
Basic	154,389	150,772	154,056	149,215
Diluted	154,389	150,772	154,056	149,215

Consolidated Statements of Cash

Consolidated Statements of Cash Flows (USD $)
In Thousands	6 Months Ended Jun. 30, 2009	6 Months Ended Jun. 30, 2008
Operating activities:
Net loss	($7,275)	($27,506)
Adjustments to reconcile net cash provided from operating activities:
Loss (gain) from equity method investments	5,526	(19)
Deferred income tax benefit	(4,318)	(17,651)
Depletion, depreciation and amortization	173,033	142,248
Exploration dry hole costs	131	9,256
Mark-to-market on oil and gas derivatives not designated as hedges	30,070	297,501
Abandonment and impairment of unproved properties	60,526	5,598
Unrealized derivative loss	97	2,691
Deferred and stock-based compensation	32,794	43,601
Amortization of deferred financing costs and other	2,333	1,488
Loss (gain) on sale of assets and other	1,943	(19,972)
Changes in working capital:
Accounts receivable	46,453	(94,657)
Inventory and other	(2,154)	(29,839)
Accounts payable	(72,008)	22,384
Accrued liabilities and other	1,283	9,739
Net cash provided from operating activities	268,434	344,862
Investing activities:
Additions to oil and gas properties	(275,999)	(407,313)
Additions to field service assets	(14,849)	(19,895)
Acreage purchases	(107,321)	(404,922)
Investment in equity method investments	(6,400)	(10,800)
Other assets	9,079	0
Proceeds from disposal of assets	182,122	66,660
Purchase of marketable securities held by the deferred compensation plan	(3,605)	(5,848)
Proceeds from the sales of marketable securities held by the deferred compensation plan	1,981	3,320
Net cash used in investing activities	(214,992)	(778,798)
Financing activities:
Borrowing on credit facilities	451,000	678,000
Repayment on credit facilities	(741,000)	(775,500)
Dividends paid	(12,541)	(12,196)
Debt issuance costs	(6,161)	(5,510)
Issuance of subordinated notes	285,201	250,000
Issuance of common stock	6,002	288,073
Cash overdrafts	(38,212)	2,891
Proceeds from the sales of common stock held by the deferred compensation plan	3,683	4,306
Purchases of common stock held by the deferred compensation plan and other treasury stock purchases	(15)	(73)
Net cash (used in) provided from financing activities	(52,043)	429,991
Increase (decrease) in cash and equivalents	1,399	(3,945)
Cash and equivalents at beginning of period	753	4,018
Cash and equivalents at end of period	$2,152	$73

Consolidated Statements of Comp

Consolidated Statements of Comprehensive Income (Loss) (USD $)
In Thousands	3 Months Ended Jun. 30, 2009	3 Months Ended Jun. 30, 2008	6 Months Ended Jun. 30, 2009	6 Months Ended Jun. 30, 2008
Net loss	($39,883)	($32,355)	($7,275)	($27,506)
Other comprehensive (loss) income:
Realized loss (gain) on hedge derivative contract settlements reclassified into earnings from other comprehensive (loss) income	(33,488)	30,975	(65,822)	27,762
Change in unrealized deferred hedging gains (losses)	(3,000)	(200,957)	43,183	(282,726)
Total comprehensive loss	($76,371)	($202,337)	($29,914)	($282,470)

Organization and Nature of Busi

Organization and Nature of Business
	6 Months Ended Jun. 30, 2009 USD / shares
Organization and Nature of Business [Abstract]
ORGANIZATION AND NATURE OF BUSINESS	(1)ORGANIZATION AND NATURE OF BUSINESS We are engaged in the exploration, development and acquisition of oil and gas properties primarily in the Southwestern, Appalachian and Gulf Coast regions of the United States. We seek to increase our reserves and production primarily through drilling and complementary acquisitions. Range Resources Corporation is a Delaware corporation with our common stock listed and traded on the New York Stock Exchange under the symbol RRC.

Basis of Presentation

Basis of Presentation
	6 Months Ended Jun. 30, 2009 USD / shares
Basis of Presentation [Abstract]
BASIS OF PRESENTATION	(2)BASIS OF PRESENTATION These interim financial statements should be read in conjunction with the consolidated financial statements and notes thereto included in the Range Resources Corporation 2008 Annual Report on Form 10-K filed on February25, 2009. These consolidated financial statements are unaudited but, in the opinion of management, reflect all adjustments necessary for fair presentation of the results for the periods presented. All adjustments are of a normal recurring nature unless disclosed otherwise. These consolidated financial statements, including selected notes, have been prepared in accordance with the applicable rules of the Securities and Exchange Commission (SEC) and do not include all of the information and disclosures required by accounting principles generally accepted in the United States of America for complete financial statements. We have evaluated events or transactions through July22, 2009 in conjunction with our preparation of these financial statements. We adhere to Statement of Financial Accounting Standards (SFAS) No.19 Financial Accounting and Reporting by Oil and Gas Producing Companies, for recognizing impairment of capitalized costs related to unproved properties. These costs are capitalized and periodically evaluated (at least quarterly) as to recoverability based on changes brought about by economic factors and potential shifts in business strategy employed by management. We consider time, geologic and engineering factors to evaluate the need for impairment of these costs. We continue to experience an increase in lease expirations and impairment expense caused by (1)current economic conditions which have impacted our future drilling plans thereby increasing the amount of expected lease expirations and (2)the expansion of our unproved property positions in new shale plays. As economic conditions change and we continue to evaluate unproved properties, our estimates of expirations likely will change and we may increase or decrease impairment expense. We recorded abandonment and impairment expense in the first six months of 2009 of $60.5million compared to $5.6million in the same period of the prior year. In the second quarter of 2009, we recorded abandonment and impairment expense of $41.0million, which includes the expiration of certain significant Barnett Shale leases. In second quarter 2009, we identified certain leases amounting to $8.2million that expired in 2006, 2007, and 2008, which were not expensed as required. Based on Staff Accounting Bulletin No. 108 (SAB 108), we have determined that these amounts are immaterial to each of the time periods affected and, therefore, we are not required to amend our previously filed reports. However, if these adjustments were recorded in 2009, we believe the impact could be material to this year. Therefore, we plan to adjust our previously reported results for 2006, 2007, and 2008 for these immaterial amounts as required by SAB 108. Such previous periods will be restated upon the next filing of our annual consolidated financial statements. In addition to recording additional lease expirations, we plan to make four other adjustments to prior year

New Accounting Standards

New Accounting Standards
	6 Months Ended Jun. 30, 2009 USD / shares
New Accounting Standards [Abstract]
NEW ACCOUNTING STANDARDS	(3)NEW ACCOUNTING STANDARDS In February2008, the Financial Accounting Standards Board (FASB) issued staff position (FSP) SFAS No.157-2 which delayed the effective date of SFAS No.157 for all non-financial assets and non-financial liabilities except those that are recognized or disclosed at fair value in the financial statements on a recurring basis (at least annually). This deferral of SFAS No.157 primarily applied to our asset retirement obligation (ARO), which uses fair value measures at the date incurred to determine our liability and any property impairments that may occur. We adopted FSP SFAS No.157-2 effective January1, 2009 and the adoption did not have a material effect on our consolidated results of operations. In June2008, the FASB issued Staff Position No.EITF 03-6-1 Determining Whether Instruments Granted in Share-Based Payment Transactions are Participating Securities, (FSP EITF 03-6-1) which provides that unvested share-based payment awards that contain nonforfeitable rights to dividends or dividend equivalents (whether paid or unpaid) are participating securities and, therefore, need to be included in the earnings allocation in computing earnings per share under the two class method. We adopted FSP EITF 03-6-1 on January1, 2009 with no impact on our reported earnings per share. In March2008, the FASB issued SFAS No.161, Disclosure about Derivative Instruments and Hedging Activities, an amendment of FASB Statement No.133. SFAS No.161 amends and expands the disclosure requirements of SFAS No.133 with the intent to provide users of financial statements with an enhanced understanding of: (i)how and why any entity uses derivative instruments; (ii) how derivative instruments and related hedged items are accounted for under SFAS No.133 and its related interpretations; and (iii)how derivative instruments and related hedged items affect an entitys financial position, financial performance and cash flows. We adopted SFAS No.161 on January1, 2009. See Note 11 for additional disclosures required by SFAS No.161. In December2007, the FASB issued SFAS No.141(R), Business Combinations. SFAS No.141(R) replaces SFAS No.141. The statement retains the purchase method of accounting for acquisitions, but requires a number of changes, including changes in the way assets and liabilities are recognized in the purchase method of accounting. It changes the recognition of assets acquired and liabilities assumed arising from contingencies, requires the capitalization of in-process research and development at fair value, and requires the expensing of acquisition-related costs as incurred. The statement will apply prospectively to business combinations occurring in our fiscal year beginning January1, 2009. The adoption of SFAS No.141(R) did not have an effect on our reported financial position or earnings. In April2009, two related FASB Staff Positions were issued: FASB Staff Position (FSP) No.FAS 107-1 and APB 28-1, Interim Disclosures about Fair Value of Financial Instruments, (FSP FAS 107-1) FSP No.FAS 157-4, Determining Fair Value When the Volume and Level of Activity for the Asset or Liability Have Significant

Dispositions

Dispositions
	6 Months Ended Jun. 30, 2009 USD / shares
Dispositions [Abstract]
DISPOSITIONS	(4)DISPOSITIONS In second quarter 2009, we sold certain oil properties in West Texas for proceeds of $182.0 million. The proceeds from the sale of these oil properties were credited to oil and gas properties, with no gain or loss recognized, as the disposition did not materially impact the depletion rate of the remaining properties in the amortization base. In first quarter 2008, we sold East Texas properties for proceeds of $64.4million and recorded a gain of $20.2million.

Income Taxes

Income Taxes
	6 Months Ended Jun. 30, 2009 USD / shares
Income Taxes [Abstract]
INCOME TAXES	(5)INCOME TAXES Income tax expense (benefit)was as follows (in thousands): Three Months Ended Six Months Ended June 30, June 30, 2009 2008 2009 2008 (Restated) Income tax benefit $ (22,526 ) $ (19,496 ) $ (3,699 ) $ (15,816 ) Effective tax rate 36.1 % 37.6 % 33.7 % 36.5 % We compute our quarterly taxes under the effective tax rate method based on applying an anticipated annual effective rate to our year-to-date income (loss), except for discrete items. Income taxes for discrete items are computed and recorded in the period that the specific transaction occurs. For the three months ended June30, 2009 and 2008, our overall effective tax rate on pre-tax income from operations was different than the statutory rate of 35% due primarily to state income taxes. For the six months ended June30, 2009, our overall effective tax rate on income from operations was different than the statutory rate of 35% due primarily to state income taxes, valuation allowance and permanent differences. For the six months June30, 2008, our overall effective tax rate on income from operations was different than the statutory rate due primarily to state income taxes. We expect our effective tax rate to be approximately 37% for the remainder of 2009. At December31, 2008, we had regular tax net operating loss (NOL) carryforwards of $160.4 million and alternative minimum tax (AMT) NOL carryforwards of $92.5million that expire between 2012 and 2027. Our deferred tax asset related to regular NOL carryforwards at December31, 2008 was $10.7million, net of the SFAS No.123(R) deduction for unrealized benefits. At December31, 2008, we have AMT credit carryforwards of $1.8million that are not subject to limitation or expiration.

Earnings

Earnings (Loss) Per Common Share
	6 Months Ended Jun. 30, 2009 USD / shares
Earnings Per Common Share [Abstract]
EARNINGS (LOSS) PER COMMON SHARE	(6)EARNINGS (LOSS)PER COMMON SHARE Basic income (loss)per share is based on weighted average number of common shares outstanding. Diluted income per share includes exercise of stock options, stock appreciation rights and restricted shares, provided the effect is not anti-dilutive. The following table sets forth the computation of basic and diluted earnings (loss)per common share (in thousands except per share amounts): Three Months Ended Six Months Ended June 30, June 30, 2009 2008 2009 2008 (Restated) (Restated) Numerator: Net loss $ (39,883 ) $ (32,355 ) $ (7,275 ) $ (27,506 ) Denominator: Weighted average common shares outstanding basic 154,389 150,772 154,056 149,215 Effect of dilutive securities: Employee stock options, SARs and stock held in the deferred compensation plan Weighted average common shares diluted 154,389 150,772 154,056 149,215 Loss per common share: Basic net loss $ (0.26 ) $ (0.22 ) $ (0.05 ) $ (0.18 ) Diluted net loss $ (0.26 ) $ (0.22 ) $ (0.05 ) $ (0.18 ) The weighted average common shares basic amount excludes 2.4million shares at June30, 2009 and 2.2million shares at June30, 2008, of restricted stock that is held in our deferred compensation plan (although all restricted stock is issued and outstanding upon grant). Due to our net loss from operations for the three months and the six months ended June30, 2009, we excluded all 10.4million outstanding stock options/SARs and restricted stock because the effect would have been anti-dilutive. Due to our net loss from operations for the three months and the six months ended June30, 2008, we excluded all 10.0million outstanding stock options/SARs and restricted stock because the effect would have been anti-dilutive.

Suspended Exploratory Well Cost

Suspended Exploratory Well Costs
	6 Months Ended Jun. 30, 2009 USD / shares
Suspended Exploratory Well Costs [Abstract]
SUSPENDED EXPLORATORY WELL COSTS	(7)SUSPENDED EXPLORATORY WELL COSTS The following table reflects the changes in capitalized exploratory well costs for the six months ended June30, 2009 and the year ended December31, 2008 (in thousands): June 30, December 31, 2009 2008 Beginning balance at January 1 $ 47,623 $ 15,053 Additions to capitalized exploratory well costs pending the determination of proved reserves 20,509 43,968 Reclassifications to wells, facilities and equipment based on determination of proved reserves (1,288 ) (3,847 ) Capitalized exploratory well costs charged to expense (7,551 ) Balance at end of period 66,844 47,623 Less exploratory well costs that have been capitalized for a period of one year or less (48,020 ) (41,681 ) Capitalized exploratory well costs that have been capitalized for a period greater than one year $ 18,824 $ 5,942 Number of projects that have exploratory well costs that have been capitalized for a period greater than one year 8 3 The $66.8million of capitalized exploratory well costs at June30, 2009 was incurred in 2009 ($18.5million), in 2008 ($42.4million) and in 2007 ($5.9million). Of the eight projects that have exploratory costs capitalized for more than one year, seven projects are Marcellus Shale wells.

Indebtedness

Indebtedness
	6 Months Ended Jun. 30, 2009 USD / shares
Indebtedness [Abstract]
INDEBTEDNESS	(8)INDEBTEDNESS We had the following debt outstanding as of the dates shown below (in thousands) (bank debt interest rate at June30, 2009 is shown parenthetically). No interest expense was capitalized during the three months or the six months ended June30, 2009 and 2008. June 30, December 31, 2009 2008 Bank debt (2.1%) $ 403,000 $ 693,000 Subordinated debt: 7.375% Senior Subordinated Notes due 2013, net of discount 198,161 197,968 6.375% Senior Subordinated Notes due 2015 150,000 150,000 7.5% Senior Subordinated Notes due 2016, net of discount 249,616 249,595 7.5% Senior Subordinated Notes due 2017 250,000 250,000 7.25% Senior Subordinated Notes due 2018 250,000 250,000 8.0% Senior Subordinated Notes due 2019, net of discount 285,357 Other 105 Total debt $ 1,786,134 $ 1,790,668 Estimated fair value(1) $ 1,725,259 $ 1,621,793 (1) The book value of our bank debt approximates fair value because of its floating rate structure. The fair value of our senior subordinated debt is based on quoted end of period market prices. Bank Debt In October2006, we entered into an amended and restated revolving bank facility, which we refer to as our bank debt or our bank credit facility, which is secured by substantially all of our assets. The bank credit facility provides for an initial commitment equal to the lesser of the facility amount or the borrowing base. On June30, 2009, the borrowing base was $1.5billion and our facility amount was $1.25billion. The bank credit facility provides for a borrowing base subject to redeterminations semi-annually each April and October and for event-driven unscheduled redeterminations. Our current bank group is comprised of twenty-six commercial banks each holding between 2.4% and 5.0% of the total facility. Of those twenty-six banks, thirteen are domestic banks and thirteen are foreign banks or wholly owned subsidiaries of foreign banks. The facility amount may be increased up to the borrowing base amount with twenty days notice, subject to payment of a mutually acceptable commitment fee to those banks agreeing to participate in the facility amount increase. At June30, 2009, the outstanding balance under the bank credit facility was $403.0million and there was $847.0million of borrowing capacity available under the facility amount. The loan matures October25, 2012. Borrowing under the bank credit facility can either be the Alternate Base Rate (as defined) plus a spread ranging from 0.875% to 1.625% or LIBOR borrowings at the adjusted LIBO Rate (as defined) plus a spread ranging from 1.75% to 2.5%. The applicable spread is dependent upon borrowings relative to the borrowing base. We may elect, from time to time, to convert all or any part of our LIBOR loans to base rate loans or to convert all or any part of the base rate loans to LIBOR loans. The weighted average interest rate on the bank credit facility was 2.5% for the three months ended June30, 2009 co

Asset Retirement Obligations

Asset Retirement Obligations
	6 Months Ended Jun. 30, 2009 USD / shares
Asset Retirement Obligations [Abstract]
ASSET RETIREMENT OBLIGATIONS	(9)ASSET RETIREMENT OBLIGATIONS Our asset retirement obligation primarily represents the estimated present value of the amount we will incur to plug, abandon and remediate our producing properties at the end of their productive lives. Significant inputs used in determining such obligations include estimates of plugging and abandonment costs, estimated future inflation rates and well life. A reconciliation of our liability for plugging, abandonment and remediation costs for the six months ended June30, 2009 is as follows (in thousands): Six Months Ended June 30, 2009 Beginning of period $ 83,457 Liabilities incurred 915 Liabilities settled (450 ) Liabilities sold (7,287 ) Accretion expense 2,623 Change in estimate 2,550 End of period $ 81,808 Accretion expense is recognized as a component of depreciation, depletion and amortization on our statement of operations.

Capital Stock

Capital Stock
	6 Months Ended Jun. 30, 2009 USD / shares
Capital Stock [Abstract]
CAPITAL STOCK	(10)CAPITAL STOCK We have authorized capital stock of 485million shares, which includes 475million shares of common stock and 10million shares of preferred stock. The following is a summary of changes in the number of common shares outstanding since the beginning of 2008: Six Months Ended Year Ended June 30, December 31, 2009 2008 Beginning balance 155,375,487 149,511,997 Public offering 4,435,300 Stock options/SARs exercised 797,084 1,339,536 Restricted stock grants 475,306 167,054 Treasury shares (78,400 ) Issued for unproved property purchases 373,623 Ending balance 157,021,500 155,375,487 Treasury Stock The Board of Directors has approved up to $10.0million of repurchases of common stock based on market conditions and opportunities. We have $6.8million remaining under this authorization.

Derivative Activities

Derivative Activities
	6 Months Ended Jun. 30, 2009 USD / shares
Derivative Activities [Abstract]
DERIVATIVE ACTIVITIES	(11)DERIVATIVE ACTIVITIES We use commoditybased derivative contracts to manage exposures to commodity price fluctuations. We do not enter into these arrangements for speculative or trading purposes. These contracts consist of collars and fixed price swaps. We do not utilize complex derivatives such as swaptions, knockouts or extendable swaps. At June30, 2009, we had open swap contracts covering 17.0 Bcf of gas at prices averaging $7.40 per mcf. We also had collars covering 61.3 Bcf of gas at weighted average floor and cap prices of $6.64 to $7.85 per mcf and 1.5million barrels of oil at weighted average floor and cap prices of $64.01 to $76.00 per barrel. Their fair value, represented by the estimated amount that would be realized upon termination, based on a comparison of the contract prices and a reference price, generally New York Mercantile Exchange (NYMEX), on June30, 2009, was a net unrealized pre-tax gain of $169.4million. These contracts expire monthly through December2010. The following table sets forth our derivative volumes and average hedge prices as of June30, 2009: Average Period Contract Type Volume Hedged Hedge Price Natural Gas 2009 Swaps 92,351 Mmbtu/day $ 7.40 2009 Collars 194,918 Mmbtu/day $ 7.46-$8.15 2010 Collars 69,671 Mmbtu/day $ 5.50-$7.43 Crude Oil 2009 Collars 8,000 bbl/day $ 64.01-$76.00 Under SFAS No.133, every derivative instrument is required to be recorded on the balance sheet as either an asset or a liability measured at its fair value. Fair value is generally determined based on the difference between the fixed contract price and the underlying estimated market price at the determination date. Changes in the fair value of effective cash flow hedges are recorded as a component of Accumulated other comprehensive income (loss), (AOCI) which is later transferred to earnings when the underlying physical transaction occurs. Our AOCI at June 30, 2009 and December31, 2008 relate solely to our derivative activities. If the derivative does not qualify as a hedge or is not designated as a hedge, the change in fair value of the derivative is recognized in earnings. As of June30, 2009, an unrealized pre-tax derivative gain of $87.1 million was recorded in AOCI. This gain is expected to be reclassified into earnings in 2009 ($84.5million) and 2010 ($2.6million). The actual reclassification to earnings will be based on market prices at the contract settlement date. For those derivative instruments that qualify for hedge accounting, settled transaction gains and losses are determined monthly, and are included as increases or decreases to oil and gas sales in the period the hedged production is sold. Oil and gas sales includes $53.2million of gains in the three months ended June30, 2009 compared to losses of $50.0million in the three months ended June30, 2008 related to settled hedging transactions. For the six months ended June30, 2009, oil and gas sales include $104.5million of gains compared to losses of $44.8million in the same period of the prior period related t

Fair Value Measurements

Fair Value Measurements
	6 Months Ended Jun. 30, 2009 USD / shares
Fair Value Measurements [Abstract]
FAIR VALUE MEASUREMENTS	(12)FAIR VALUE MEASUREMENTS We use a market approach for our fair value measurements and endeavor to use the best information available. Accordingly, valuation techniques that maximize the use of observable impacts are favored. The following table presents the fair value hierarchy table for assets and liabilities measured at fair value, on a recurring basis (in thousands): Fair Value Measurements at June 30, 2009 Using: Quoted Prices in Active Significant Total Markets for Other Significant Carrying Identical Observable Unobservable Value as of Assets Inputs Inputs June 30, (Level 1) (Level 2) (Level 3) 2009 Trading securities held in the deferred compensation plans $ 37,320 $ $ $ 37,320 Derivatives swaps 53,455 53,455 collars 115,976 115,976 basis swaps (4,521 ) (4,521 ) These items are classified in their entirety based on the lowest priority level of input that is significant to the fair value measurement. The assessment of the significance of a particular input to the fair value measurement requires judgment and may affect the placement of assets and liabilities within the levels of the fair value hierarchy. Our trading securities in Level 1 are exchange-traded and measured at fair value with a market approach using June30, 2009 market values. Derivatives in Level 2 are measured at fair value with a market approach using third-party pricing services which have been corroborated with data from active markets or broker quotes. Our trading securities held in the deferred compensation plan are accounted for using the mark-to-market accounting method and are included in the balance sheet category called other assets. We adopted SFAS No.159, The Fair Value Option for Financial Assets and Financial Liabilities on January1, 2008 which resulted in a reclassification of a $2.0million pre-tax loss ($1.3million after tax) related to our trading securities held in our deferred compensation plan from accumulated other comprehensive loss to retained earnings. We elected to adopt the fair value option to simplify our accounting for the investments in our deferred compensation plan. Interest, dividends, and mark-to-market gains/losses are included in the statement of operations category called Deferred compensation plan expense. For the three months ended June30, 2009, interest and dividends were $50,000 and mark-to-market was a gain of $4.9million. For the three months ended June30, 2008, interest and dividends were $79,000 and the mark-to-market was a loss of $666,000. For the six months ended June30, 2009, interest and dividends were $93,000 and mark-to-market was a gain of $3.4million. For the six months ended June30, 2008, interest and dividends were $266,000 and the mark-to-market was a loss of $5.3million. Concentration of Credit Risk Most of our receivables are from a diverse group of companies, including major energy companies, pipeline companies, local distributi

Employee Benefit and Equity Pla

Employee Benefit and Equity Plans
	6 Months Ended Jun. 30, 2009 USD / shares
Employee Benefit and Equity Plans [Abstract]
EMPLOYEE BENEFIT AND EQUITY PLANS	(13)EMPLOYEE BENEFIT AND EQUITY PLANS We have six equity-based stock plans, of which two are active. Under the active plans, incentive and nonqualified options, SARs and annual cash incentive awards may be issued to directors and employees pursuant to decisions of the Compensation Committee, which is made up of non-employee, independent directors from the Board of Directors. All awards granted have been issued at prevailing market prices at the time of the grant. Since the middle of 2005, only SARs have been granted under the plans to limit the dilutive impact of our equity plans. Information with respect to stock option and SARs activities is summarized below: Weighted Average Exercise Shares Price Outstanding on December31, 2008 7,248,666 $ 26.15 Granted 1,693,405 36.76 Exercised (941,562 ) 11.48 Expired/forfeited (38,449 ) 37.72 Outstanding on June30, 2009 7,962,060 $ 30.08 The following table shows information with respect to outstanding stock options and SARs at June30, 2009: Outstanding Exercisable Weighted- Weighted- Weighted- Average Average Average Remaining Exercise Exercise Range of Exercise Prices Shares Contractual Life Price Shares Price $1.29$9.99 944,761 2.43 $ 3.39 944,761 $ 3.39 10.0019.99 1,603,543 0.86 16.46 1,603,543 16.46 20.0029.99 1,225,216 1.75 24.38 1,200,916 24.33 30.0039.99 2,481,212 3.58 34.10 802,646 34.27 40.0049.99 618,287 4.83 41.68 53,957 41.70 50.0059.99 713,876 3.62 58.57 216,122 58.57 60.0069.99 28,427 3.88 65.33 8,529 65.33 70.0075.00 346,738 3.89 75.00 122,563 75.00 Total 7,962,060 2.73 $ 30.08 4,953,037 $ 22.41 The weighted average fair value of an option/SAR to purchase one share of common stock granted during 2009 was $15.39. The fair value of each stock option/SAR granted during 2009 was estimated as of the date of grant using the Black-Scholes-Merton option-pricing model based on the following average assumptions: risk-free interest rate of 1.5%; dividend yield of 0.4%; expected volatility of 59%; and an expected life of 3.5years. As of June30, 2009, the aggregate intrinsic value (the difference in value between exercise and market price) of the awards outstanding was $115.0million. The aggregate intrinsic value and weighted average remaining contractual life of stock option awards currently exercisable was $102.2 million and 1.9years. As of June30, 2009, the number of fully vested awards and awards expected to vest was 7.8million. The weighted average exercise price and weighted average remaining contractual life of these awards was $29.80 and 2.7years and the aggregate intrinsic value w

Supplemental Cash Flow Informat

Supplemental Cash Flow Information
	6 Months Ended Jun. 30, 2009 USD / shares
Supplemental Cash Flow Information [Abstract]
SUPPLEMENTAL CASH FLOW INFORMATION	(14)SUPPLEMENTAL CASH FLOW INFORMATION Six Months Ended June 30, 2009 2008 (in thousands) Non-cash investing and financing activities included: Asset retirement costs (removed)capitalized, net $ (3,866 ) $ 3,175 Unproved property purchased with stock $ 15,920 $ Net cash provided from operating activities included: Interest paid $ 51,185 $ 43,189 Income taxes paid $ 507 $ 2,320

Commitments and Contingencies

Commitments and Contingencies
	6 Months Ended Jun. 30, 2009 USD / shares
Commitments and Contingencies [Abstract]
COMMITMENTS AND CONTINGENCIES	(15)COMMITMENTS AND CONTINGENCIES Transportation Contracts We have entered firm transportation contracts with various pipelines. Under these contracts, we are obligated to transport minimum daily gas volumes, as calculated on a monthly basis, or pay for any deficiencies at a specified reservation fee rate. In most cases, our production committed to these pipelines is expected to exceed the minimum daily volumes provided in the contracts. As of June30, 2009, future minimum transportation fees under our gas transportation commitments are as follows (in thousands): 2009 remaining $ 17,774 2010 34,663 2011 34,180 2012 31,220 2013 30,349 2014 27,070 Thereafter 207,240 $ 382,496 Litigation We are involved in various legal actions and claims arising in the ordinary course of our business. While the outcome of these lawsuits cannot be predicted with certainty, we do not expect these matters to have a material adverse effect on our financial position, cash flows or results of operations.

Capitalized Costs and Accumulat

Capitalized Costs and Accumulated Depreciation, Depletion and Amortization
	6 Months Ended Jun. 30, 2009 USD / shares
Capitalized Costs and Accumulated Depreciation, Depletion and Amortization [Abstract]
CAPITALIZED COSTS AND ACCUMULATED DEPRECIATION, DEPLETION AND AMORTIZATION(a)	(16)CAPITALIZED COSTS AND ACCUMULATED DEPRECIATION, DEPLETION AND AMORTIZATION(a) June 30, December 31, 2009 2008 (in thousands) (Restated) Oil and gas properties: Properties subject to depletion $ 5,370,529 $ 5,271,021 Unproved properties 791,305 757,959 Total 6,161,834 6,028,980 Accumulated depreciation, depletion and amortization (1,337,153 ) (1,186,934 ) Net capitalized costs $ 4,824,681 $ 4,842,046 (a) Includes capitalized asset retirement costs and associated accumulated amortization.

Costs Incurred For Property Acq

Costs Incurred For Property Acquisitions, Exploration and Development
	6 Months Ended Jun. 30, 2009 USD / shares
Costs Incurred For Property Acquisitions, Exploration and Development [Abstract]
COSTS INCURRED FOR PROPERTY ACQUISITIONS, EXPLORATION AND DEVELOPMENT(a)	(17)COSTS INCURRED FOR PROPERTY ACQUISITIONS, EXPLORATION AND DEVELOPMENT(a) Six Months Ended Year Ended June 30, December 31, 2009 2008 (in thousands) Acquisitions: Unproved leasehold $ $ 99,446 Proved oil and gas properties 443 251,471 Asset retirement obligations 251 Acreage purchases 110,093 494,341 Development 243,125 729,268 Exploration: Drilling 31,678 133,116 Expense 22,753 63,560 Stock-based compensation expense 1,954 4,130 Gas gathering facilities 14,581 47,056 Subtotal 424,627 1,822,639 Asset retirement obligations (3,866 ) 4,647 Total costs incurred $ 420,761 $ 1,827,286 (a) Includes costs incurred whether capitalized or expensed.

Restatement Of Prior Periods

Restatement Of Prior Periods
	6 Months Ended Jun. 30, 2009 USD / shares
Restatement Of Prior Periods [Abstract]
RESTATEMENT OF PRIOR PERIODS	(18)RESTATEMENT OF PRIOR PERIODS As further explained in Footnote 2, we plan to adjust previously reported results for 2006, 2007 and 2008 for immaterial errors as required by SAB 108. Additionally, we have restated the second quarter and the six months ended June30, 2008 to reflect the impact of such errors. The following presents these adjustments in detail: 1st Quarter 2008 2nd Quarter 2008 Six Months 2008 Previously Previously Previously Reported Adjustments Adjusted Reported Adjustments Adjusted Reported Adjustments Adjusted Oil and gas sales $ 307,384 $ $ 307,384 $ 347,622 $ $ 347,622 $ 655,006 $ $ 655,006 Transportation and gathering 1,129 1,129 1,224 1,224 2,353 2,353 Derivative fair value income (123,767 ) (123,767 ) (198,410 ) 1,726 (196,684 ) (322,177 ) 1,726 (320,451 ) Other 20,592 20,592 (359 ) (359 ) 20,233 20,233 Total revenues 205,338 205,338 150,077 1,726 151,803 355,415 1,726 357,141 Direct operating costs 32,950 32,950 37,228 37,228 70,178 70,178 Production and ad valorem taxes 13,840 13,840 16,056 16,056 29,896 29,896 Exploration 16,593 16,593 19,462 19,462 36,055 36,055 Abandonment impairment of unproved properties 1,437 687 2,124 5,348 (1,874 ) 3,474 6,785 (1,187 ) 5,598 General and administrative expense 17,412 17,412 23,938 23,938 41,350 41,350 Deferred compensation plan 20,611 20,611 7,539 7,539 28,150 28,150 Interest expense 23,146 23,146 23,842 23,842 46,988 46,988 Depletion, depreciation and amortization 70,133 70,133 72,115 72,115 142,248 142,248 Total costs 196,122 687 196,809 205,528 (1,874 ) 203,654 401,650 (1,187 ) 400,463 Income (loss)from operations 9,216 (687 ) 8,529 (55,451 ) 3,600 (51,851 ) (46,235 ) 2,913 (43,322 ) Income tax expense (benefit) Current 886 886 949 949 1,835 1,835 Deferred 6,590 (3,796 ) 2,794 (21,818 ) 1,373 (20,445 ) (15,228 ) (2,423 ) (17,651 )

Accounting Standards Not Yet Ad

Accounting Standards Not Yet Adopted
	6 Months Ended Jun. 30, 2009 USD / shares
Accounting Standards Not Yet Adopted [Abstract]
ACCOUNTING STANDARDS NOT YET ADOPTED	(19)ACCOUNTING STANDARDS NOT YET ADOPTED In December2008, the SEC announced that it had approved revisions to its oil and gas reporting disclosures. The new disclosure requirements include provisions that: Introduce a new definition of oil and gas producing activities. This new definition allows companies to include in their reserve base volumes from unconventional resources. Such unconventional resources include bitumen extracted from oil sands and oil and gas extracted from coal beds and shale formations. Report oil and gas reserves using an unweighted average price using the prior 12-month period, based on the closing prices on the first day of each month, rather than year-end prices. The SEC indicated that they will continue to communicate with the FASB staff to align their accounting standards with these rules. The FASB currently requires a single-day, year-end price for accounting purposes. Permit companies to disclose their probable and possible reserves on a voluntary basis. In the past, proved reserves were the only reserves allowed in the disclosures. Requires companies to provide additional disclosure regarding the aging of proved undeveloped reserves. Permit the use of reliable technologies to determine proved reserves if those technologies have been demonstrated empirically to lead to reliable conclusions about reserves volumes. Replace the existing certainty test for areas beyond one offsetting drilling unit from a productive well with a reasonable certainty test. Require additional disclosures regarding the qualifications of the chief technical person who oversees the companys overall reserve estimation process. Additionally, disclosures regarding internal controls over reserve estimation, as well as a report addressing the independence and qualifications of its reserves preparer or auditor will be mandatory. We will begin complying with the disclosure requirements in our annual report on Form 10-K for the year ending December31, 2009. The new rules may not be applied to disclosures in quarterly reports prior to the first annual report in which the revised disclosures are required. We are currently in the process of evaluating the new requirements.