Document_and_Entity_Informatio
Document and Entity Information | 9 Months Ended | |
Sep. 30, 2013 | Oct. 21, 2013 | |
Document and Entity Information | ||
Entity Registrant Name | CABOT OIL & GAS CORP | |
Entity Central Index Key | 858470 | |
Document Type | 10-Q | |
Document Period End Date | 30-Sep-13 | |
Amendment Flag | FALSE | |
Current Fiscal Year End Date | -19 | |
Entity Current Reporting Status | Yes | |
Entity Filer Category | Large Accelerated Filer | |
Entity Common Stock, Shares Outstanding | 421,959,520 | |
Document Fiscal Year Focus | 2013 | |
Document Fiscal Period Focus | Q3 |
CONDENSED_CONSOLIDATED_BALANCE
CONDENSED CONSOLIDATED BALANCE SHEET (USD $) | Sep. 30, 2013 | Dec. 31, 2012 |
In Thousands, unless otherwise specified | ||
Current assets | ||
Cash and cash equivalents | $27,932 | $30,736 |
Accounts receivable, net | 178,479 | 172,419 |
Income taxes receivable | 1,972 | |
Inventories | 20,839 | 14,173 |
Derivative instruments | 56,831 | 50,824 |
Other current assets | 3,703 | 2,158 |
Total current assets | 289,756 | 270,310 |
Properties and equipment, net (Successful efforts method) | 4,690,176 | 4,310,977 |
Derivative instruments | 8,708 | |
Other assets | 42,752 | 35,026 |
TOTAL ASSETS | 5,031,392 | 4,616,313 |
Current liabilities | ||
Accounts payable | 335,349 | 312,480 |
Current portion of long-term debt | 75,000 | |
Accrued liabilities | 59,234 | 49,789 |
Income taxes payable | 1,667 | |
Deferred income taxes | 4,690 | 5,203 |
Total current liabilities | 399,273 | 444,139 |
Postretirement benefits | 41,041 | 38,864 |
Long-term debt | 1,162,000 | 1,012,000 |
Deferred income taxes | 986,943 | 882,672 |
Asset retirement obligation | 70,525 | 67,016 |
Other liabilities | 42,876 | 40,175 |
Total liabilities | 2,702,658 | 2,484,866 |
Commitments and contingencies | ||
Stockholders' equity | ||
Common stock: Authorized -- 480,000,000 shares of $0.10 par value in 2013 and 2012, respectively Issued--421,959,520 shares and 420,859,462 shares in 2013 and 2012, respectively | 42,196 | 42,086 |
Additional paid-in capital | 698,383 | 695,566 |
Retained earnings | 1,558,260 | 1,373,264 |
Accumulated other comprehensive income / (loss) | 33,244 | 23,880 |
Less treasury stock, at cost: 808,800 shares in 2013 and 2012, respectively | -3,349 | -3,349 |
Total stockholders' equity | 2,328,734 | 2,131,447 |
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY | $5,031,392 | $4,616,313 |
CONDENSED_CONSOLIDATED_BALANCE1
CONDENSED CONSOLIDATED BALANCE SHEET (Parenthetical) (USD $) | Sep. 30, 2013 | Dec. 31, 2012 |
CONDENSED CONSOLIDATED BALANCE SHEET | ||
Common stock, Authorized shares | 480,000,000 | 480,000,000 |
Common stock, par value (in dollars per share) | $0.10 | $0.10 |
Common stock, Issued shares | 421,959,520 | 420,859,462 |
Treasury stock, shares | 808,800 | 808,800 |
CONDENSED_CONSOLIDATED_STATEME
CONDENSED CONSOLIDATED STATEMENT 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 |
OPERATING REVENUES | ||||
Natural gas | $341,901 | $231,896 | $1,004,085 | $639,729 |
Crude oil and condensate | 84,209 | 57,870 | 220,090 | 165,317 |
Brokered natural gas | 7,165 | 5,238 | 26,302 | 23,831 |
Other | 2,575 | 1,870 | 8,338 | 5,790 |
TOTAL OPERATING REVENUES | 435,850 | 296,874 | 1,258,815 | 834,667 |
OPERATING EXPENSES | ||||
Direct operations | 32,923 | 28,269 | 101,398 | 84,895 |
Transportation and gathering | 60,803 | 34,430 | 159,672 | 97,827 |
Brokered natural gas cost | 5,913 | 4,258 | 21,006 | 20,380 |
Taxes other than income | 11,532 | 10,436 | 34,583 | 39,873 |
Exploration | 3,891 | 9,303 | 12,444 | 29,548 |
Depreciation, depletion and amortization | 168,980 | 110,448 | 469,022 | 335,421 |
General and administrative | 24,697 | 23,829 | 82,009 | 93,249 |
TOTAL OPERATING EXPENSES | 308,739 | 220,973 | 880,134 | 701,193 |
Gain / (loss) on sale of assets | 4,421 | -126 | 4,601 | 67,042 |
INCOME FROM OPERATIONS | 131,532 | 75,775 | 383,282 | 200,516 |
Interest expense and other | 15,796 | 16,219 | 48,752 | 51,631 |
Income before income taxes | 115,736 | 59,556 | 334,530 | 148,885 |
Income tax expense | 45,847 | 22,948 | 132,703 | 58,021 |
NET INCOME | $69,889 | $36,608 | $201,827 | $90,864 |
Earnings per share | ||||
Basic (in dollars per share) | $0.17 | $0.09 | $0.48 | $0.22 |
Diluted (in dollars per share) | $0.17 | $0.09 | $0.48 | $0.22 |
Weighted-average shares outstanding | ||||
Basic (in shares) | 420,986 | 419,312 | 420,664 | 418,866 |
Diluted (in shares) | 423,453 | 422,452 | 422,824 | 421,994 |
Dividends per common share (in dollars per share) | $0.02 | $0.01 | $0.04 | $0.03 |
CONDENSED_CONSOLIDATED_STATEME1
CONDENSED CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME (USD $) | 3 Months Ended | 9 Months Ended | ||||||
In Thousands, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | ||||
CONDENSED CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME | ||||||||
Net income | $69,889 | $36,608 | $201,827 | $90,864 | ||||
Other comprehensive income / (loss), net of taxes: | ||||||||
Reclassification adjustment for settled hedge contracts | -11,942 | [1] | -37,294 | [1] | -22,372 | [1] | -115,943 | [1] |
Changes in fair value of hedge contracts | -1,447 | [2] | -24,361 | [2] | 31,417 | [2] | 30,091 | [2] |
Pension and postretirement benefits: | ||||||||
Amortization of prior service cost | 135 | [3] | ||||||
Amortization of net loss | 70 | [4] | 79 | [4] | 319 | [4] | 8,428 | [4] |
Total other comprehensive income / (loss) | -13,319 | -61,576 | 9,364 | -77,289 | ||||
Comprehensive income / (loss) | $56,570 | ($24,968) | $211,191 | $13,575 | ||||
[1] | Net of income taxes of $7,742 and $23,644 for the three months ended September 30, 2013 and 2012, respectively, and $14,504 and $73,507 for the nine months ended September 30, 2013 and 2012, respectively. | |||||||
[2] | Net of income taxes of $937 and $15,444 for the three months ended September 30, 2013 and 2012, respectively, and $(20,366) and $(19,208) for the nine months ended September 30, 2013 and 2012, respectively. | |||||||
[3] | Net of income taxes of $0 and $0 for the three months ended September 30, 2013 and 2012, respectively, and $0 and $(86) for the nine months ended September 30, 2013 and 2012, respectively. | |||||||
[4] | Net of income taxes of $(46) and $(53) for the three months ended September 30, 2013 and 2012, respectively, and $(206) and $(5,347) for the nine months ended September 30, 2013 and 2012, respectively. |
CONDENSED_CONSOLIDATED_STATEME2
CONDENSED CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME (Parenthetical) (USD $) | 3 Months Ended | 9 Months Ended | ||
In Thousands, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 |
CONDENSED CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME | ||||
Reclassification adjustment for settled hedge contracts, income taxes | $7,742 | $23,644 | $14,504 | $73,507 |
Changes in fair value of hedge contracts, income taxes | 937 | 15,444 | -20,366 | -19,208 |
Pension and postretirement benefits: | ||||
Amortization of prior service cost, income taxes | 0 | 0 | 0 | -86 |
Amortization of net loss, income taxes | ($46) | ($53) | ($206) | ($5,347) |
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 | $201,827 | $90,864 |
Adjustments to reconcile net income to cash provided by operating activities: | ||
Depreciation, depletion and amortization | 469,022 | 335,421 |
Deferred income tax expense | 107,235 | 42,714 |
(Gain) / loss on sale of assets | -4,601 | -67,042 |
Exploration expense | 807 | 12,118 |
Unrealized (gain) / loss on derivative instruments | 449 | |
Amortization of debt issuance costs | 2,767 | 4,300 |
Stock-based compensation, pension and other | 36,684 | 37,518 |
Changes in assets and liabilities: | ||
Accounts receivable, net | -6,321 | 10,747 |
Inventories | -6,665 | 3,582 |
Other current assets | -1,547 | -1,125 |
Accounts payable and accrued liabilities | -19,837 | -16,391 |
Income taxes | -3,639 | 205 |
Other assets and liabilities | 228 | 1,752 |
Stock-based compensation tax benefit | -9,284 | |
Net cash provided by operating activities | 766,676 | 455,112 |
CASH FLOWS FROM INVESTING ACTIVITIES | ||
Capital expenditures | -843,528 | -669,198 |
Proceeds from sale of assets | 15,174 | 132,740 |
Investment in equity method investment | -8,624 | -4,488 |
Net cash used in investing activities | -836,978 | -540,946 |
CASH FLOWS FROM FINANCING ACTIVITIES | ||
Borrowings from debt | 585,000 | 280,000 |
Repayments of debt | -510,000 | -168,000 |
Stock-based compensation tax benefit | 9,284 | |
Dividends paid | -16,830 | -12,561 |
Capitalized debt issuance costs | -5,005 | |
Other | 44 | -1,010 |
Net cash provided by financing activities | 67,498 | 93,424 |
Net (decrease) / increase in cash and cash equivalents | -2,804 | 7,590 |
Cash and cash equivalents, beginning of period | 30,736 | 29,911 |
Cash and cash equivalents, end of period | $27,932 | $37,501 |
FINANCIAL_STATEMENT_PRESENTATI
FINANCIAL STATEMENT PRESENTATION | 9 Months Ended |
Sep. 30, 2013 | |
FINANCIAL STATEMENT PRESENTATION | |
FINANCIAL STATEMENT PRESENTATION | 1. FINANCIAL STATEMENT PRESENTATION |
During interim periods, Cabot Oil & Gas Corporation (the Company) follows the same accounting policies disclosed in its Annual Report on Form 10-K for the year ended December 31, 2012 (Form 10-K) filed with the Securities and Exchange Commission (SEC). The interim financial statements should be read in conjunction with the notes to the consolidated financial statements and information presented in the Form 10-K. In management’s opinion, the accompanying interim condensed consolidated financial statements contain all material adjustments, consisting only of normal recurring adjustments, necessary for a fair statement. The results for any interim period are not necessarily indicative of the expected results for the entire year. | |
Certain reclassifications have been made to prior year statements to conform with current year presentation. These reclassifications have no impact on previously reported net income. | |
On July 23, 2013, the Board of Directors declared a 2-for-1 stock split of the Company’s common stock in the form of a stock dividend. The stock dividend was distributed on August 14, 2013 to shareholders of record on August 6, 2013. All common stock accounts and per share data have been retroactively adjusted to give effect to the 2-for-1 split of the Company’s common stock. | |
With respect to the unaudited financial information of the Company as of September 30, 2013 and for the three and nine months ended September 30, 2013 and 2012, PricewaterhouseCoopers LLP reported that they have applied limited procedures in accordance with professional standards for a review of such information. However, their separate report dated October 25, 2013 appearing herein states that they did not audit and they do not express an opinion on that unaudited financial information. Accordingly, the degree of reliance on their report on such information should be restricted in light of the limited nature of the review procedures applied. PricewaterhouseCoopers LLP is not subject to the liability provisions of Section 11 of the Securities Act of 1933 for their report on the unaudited financial information because that report is not a “report” or a “part” of a registration statement prepared or certified by PricewaterhouseCoopers LLP within the meaning of Sections 7 and 11 of the Act. | |
Recent Accounting Pronouncements | |
In July 2013, the Financial Accounting Standards Board issued Accounting Standards Update (ASU) No. 2013-11, “Presentation of an Unrecognized Tax Benefit When a Net Operating Loss Carryforward, a Similar Tax Loss, or a Tax Credit Carryforward Exists.” The amendments in this update clarify the financial statement presentation of an unrecognized tax benefit when a net operating loss carryforward, a similar tax loss, or a tax credit carryforward exists. The amendments are effective for fiscal years, and interim periods within those years, beginning after December 15, 2013. The Company does not expect this guidance to have a material impact on its consolidated financial position, results of operations or cash flows. | |
Effective January 1, 2013, the Company adopted the amended disclosure requirements prescribed in ASU No. 2011-11, “Disclosures about Offsetting Assets and Liabilities” and ASU No. 2013-01, “Clarifying the Scope of Disclosures about Offsetting Assets and Liabilities.” This guidance impacted the disclosures associated with the Company’s commodity derivatives (Note 7) and did not impact its consolidated financial position, results of operations or cash flows. | |
Effective January 1, 2013, the Company adopted the amended disclosure requirements prescribed in ASU No. 2013-02, “Reporting of Amounts Reclassified Out of Accumulated Other Comprehensive Income.” This guidance impacted the Company’s disclosures associated with items reclassified from accumulated other comprehensive income / (loss) (Note 9) and did not impact its consolidated financial position, results of operations or cash flows. |
PROPERTIES_AND_EQUIPMENT_NET
PROPERTIES AND EQUIPMENT, NET | 9 Months Ended | |||||||
Sep. 30, 2013 | ||||||||
PROPERTIES AND EQUIPMENT, NET | ||||||||
PROPERTIES AND EQUIPMENT, NET | 2. PROPERTIES AND EQUIPMENT, NET | |||||||
Properties and equipment, net are comprised of the following: | ||||||||
September 30, | December 31, | |||||||
(In thousands) | 2013 | 2012 | ||||||
Proved oil and gas properties | $ | 6,522,753 | $ | 5,724,940 | ||||
Unproved oil and gas properties | 444,353 | 467,483 | ||||||
Gathering and pipeline systems | 240,285 | 239,656 | ||||||
Land, building and other equipment | 92,740 | 86,137 | ||||||
7,300,131 | 6,518,216 | |||||||
Accumulated depreciation, depletion and amortization | (2,609,955 | ) | (2,207,239 | ) | ||||
$ | 4,690,176 | $ | 4,310,977 | |||||
At September 30, 2013, the Company did not have any projects that had exploratory well costs that were capitalized for a period of greater than one year after drilling. | ||||||||
Divestitures | ||||||||
In June 2012, the Company sold a 35% non-operated working interest associated with certain of its Pearsall Shale undeveloped leaseholds in south Texas to a wholly-owned subsidiary of Osaka Gas Co., Ltd. (Osaka) for total consideration of approximately $251.0 million. The Company received $125.0 million in cash proceeds and Osaka agreed to fund 85% of the Company’s share of future drilling and completion costs associated with these leaseholds until it has paid approximately $126.0 million in accordance with a joint development agreement entered into at the closing. The Company recognized a $67.0 million gain on sale of assets associated with this sale. The drilling and completion carry under the joint development agreement will terminate two years after the closing of the transaction; however, based on the Company’s current drilling and completion activities in the Pearsall Shale, the Company expects that the carry will be fully satisfied in the fourth quarter of 2013. | ||||||||
Subsequent Event | ||||||||
In October 2013, the Company entered into purchase and sale agreements to sell certain proved and unproved oil and gas properties located in the Oklahoma and Texas panhandles for approximately $160.0 million and west Texas for approximately $28.0 million. These transactions are expected to close in the fourth quarter 2013, subject to customary closing conditions and adjustments. |
ADDITIONAL_BALANCE_SHEET_INFOR
ADDITIONAL BALANCE SHEET INFORMATION | 9 Months Ended | |||||||
Sep. 30, 2013 | ||||||||
ADDITIONAL BALANCE SHEET INFORMATION | ||||||||
ADDITIONAL BALANCE SHEET INFORMATION | 3. ADDITIONAL BALANCE SHEET INFORMATION | |||||||
Certain balance sheet amounts are comprised of the following: | ||||||||
September 30, | December 31, | |||||||
(In thousands) | 2013 | 2012 | ||||||
Accounts receivable, net | ||||||||
Trade accounts | $ | 173,096 | $ | 165,070 | ||||
Joint interest accounts | 5,452 | 5,659 | ||||||
Other accounts | 1,612 | 2,817 | ||||||
180,160 | 173,546 | |||||||
Allowance for doubtful accounts | (1,681 | ) | (1,127 | ) | ||||
$ | 178,479 | $ | 172,419 | |||||
Inventories | ||||||||
Natural gas in storage | $ | 11,732 | $ | 7,494 | ||||
Tubular goods and well equipment | 9,136 | 6,392 | ||||||
Other accounts | (29 | ) | 287 | |||||
$ | 20,839 | $ | 14,173 | |||||
Other current assets | ||||||||
Prepaid balances and other | 3,703 | 2,158 | ||||||
$ | 3,703 | $ | 2,158 | |||||
Other assets | ||||||||
Deferred compensation plan | $ | 11,865 | $ | 10,608 | ||||
Debt issuance cost | 14,652 | 17,420 | ||||||
Equity method investment | 16,154 | 6,915 | ||||||
Other accounts | 81 | 83 | ||||||
$ | 42,752 | $ | 35,026 | |||||
Accounts payable | ||||||||
Trade accounts | $ | 24,295 | $ | 5,097 | ||||
Natural gas purchases | 6,389 | 4,892 | ||||||
Royalty and other owners | 75,896 | 66,321 | ||||||
Accrued capital costs | 175,828 | 164,862 | ||||||
Taxes other than income | 10,479 | 19,164 | ||||||
Drilling advances | 35,686 | 44,203 | ||||||
Producer gas imbalances | 1,381 | 1,602 | ||||||
Other accounts | 5,395 | 6,339 | ||||||
$ | 335,349 | $ | 312,480 | |||||
Accrued liabilities | ||||||||
Employee benefits | $ | 32,870 | $ | 16,011 | ||||
Postretirement benefits | 1,304 | 1,304 | ||||||
Taxes other than income | 10,576 | 8,735 | ||||||
Interest payable | 11,560 | 22,329 | ||||||
Other accounts | 2,924 | 1,410 | ||||||
$ | 59,234 | $ | 49,789 | |||||
Other liabilities | ||||||||
Deferred compensation plan | $ | 31,800 | $ | 23,893 | ||||
Other accounts | 11,076 | 16,282 | ||||||
$ | 42,876 | $ | 40,175 |
DEBT_AND_CREDIT_AGREEMENTS
DEBT AND CREDIT AGREEMENTS | 9 Months Ended | |||||||
Sep. 30, 2013 | ||||||||
DEBT AND CREDIT AGREEMENTS | ||||||||
DEBT AND CREDIT AGREEMENTS | 4. DEBT AND CREDIT AGREEMENTS | |||||||
The Company’s debt and credit agreements consisted of the following: | ||||||||
(In thousands) | September 30, | December 31, | ||||||
2013 | 2012 | |||||||
Total debt | ||||||||
7.33% weighted-average fixed rate notes | $ | 20,000 | $ | 95,000 | ||||
6.51% weighted-average fixed rate notes | 425,000 | 425,000 | ||||||
9.78% notes | 67,000 | 67,000 | ||||||
5.58% weighted-average fixed rate notes | 175,000 | 175,000 | ||||||
Credit facility | 475,000 | 325,000 | ||||||
Current maturities | ||||||||
7.33% weighted-average fixed rate notes | — | (75,000 | ) | |||||
Long-term debt, excluding current maturities | $ | 1,162,000 | $ | 1,012,000 | ||||
Effective April 17, 2013, the lenders under the Company’s revolving credit facility approved an increase in the Company’s borrowing base from $1.7 billion to $2.3 billion as part of the annual redetermination under the terms of the credit facility. The Company’s commitments under the credit facility of $900.0 million remained unchanged. At September 30, 2013, the Company had $475.0 million of borrowings outstanding under its revolving credit facility at a weighted-average interest rate of 2.4% and $424.0 million available for future borrowings. |
EARNINGS_PER_COMMON_SHARE
EARNINGS PER COMMON SHARE | 9 Months Ended | |||||||||
Sep. 30, 2013 | ||||||||||
EARNINGS PER COMMON SHARE | ||||||||||
EARNINGS PER COMMON SHARE | 5. EARNINGS PER COMMON SHARE | |||||||||
Basic EPS is computed by dividing net income (the numerator) by the weighted-average number of common shares outstanding for the period (the denominator). Diluted EPS is similarly calculated except that the denominator is increased using the treasury stock method to reflect the potential dilution that could occur if outstanding stock appreciation rights were exercised and stock awards were vested at the end of the applicable period. | ||||||||||
Three Months Ended | Nine Months Ended | |||||||||
September 30, | September 30, | |||||||||
(In thousands) | 2013 | 2012 | 2013 | 2012 | ||||||
Weighted-average shares - basic | 420,986 | 419,312 | 420,664 | 418,866 | ||||||
Dilution effect of stock appreciation rights and stock awards at end of period | 2,467 | 3,140 | 2,160 | 3,128 | ||||||
Weighted-average shares - diluted | 423,453 | 422,452 | 422,824 | 421,994 | ||||||
Weighted-average shares excluded from diluted earnings per share due to the anti-dilutive effect | 1 | 92 | 3 | 204 |
COMMITMENTS_AND_CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 9 Months Ended |
Sep. 30, 2013 | |
COMMITMENTS AND CONTINGENCIES | |
COMMITMENTS AND CONTINGENCIES | 6. COMMITMENTS AND CONTINGENCIES |
Contractual Obligations | |
The Company has various contractual obligations in the normal course of its operations. Except for certain new and amended transportation agreements and two new drilling rig commitments described below, there have been no material changes to the Company’s contractual obligations described under “Transportation Agreements”, “Drilling Rig Commitments” and “Lease Commitments” as disclosed in Note 8 in the Notes to Consolidated Financial Statements included in the Form 10-K. | |
Transportation Agreements | |
During the first nine months of 2013, the Company entered into or amended certain natural gas transportation agreements associated with the Company’s production in Pennsylvania. These agreements increased the Company’s future aggregate obligations under its transportation commitments by approximately $49.4 million compared to those amounts in disclosed in Note 8 in the Notes to Consolidated Financial Statements included in the Form 10-K. | |
Drilling Rig Commitments | |
During the first nine months of 2013, the Company entered into two drilling rig commitments for its capital program in the Marcellus Shale. One agreement commenced in the third quarter of 2013 with an initial term of two years and the other agreement is expected to commence in the fourth quarter of 2013 with an initial term of three years. The future minimum commitments under all of the Company’s drilling rig commitments as of September 30, 2013 are approximately $3.4 million in 2013, $14.9 million in 2014, $6.8 million in 2015 and $4.4 million in 2016. | |
Legal Matters | |
The Company is a defendant in various legal proceedings arising in the normal course of business. All known liabilities are accrued when management determines they are probable based on its best estimate of the potential loss. While the outcome and impact of these legal proceedings on the Company cannot be predicted with certainty, management believes that the resolution of these proceedings will not have a material effect on the Company’s financial position, results of operations or cash flows. | |
Contingency Reserves | |
When deemed necessary, the Company establishes reserves for certain legal proceedings. The establishment of a reserve is based on an estimation process that includes the advice of legal counsel and subjective judgment of management. While management believes these reserves to be adequate, it is reasonably possible that the Company could incur additional losses with respect to those matters in which reserves have been established. The Company believes that any such amount above the amounts accrued is not material to the Condensed Consolidated Financial Statements. Future changes in facts and circumstances not currently foreseeable could result in the actual liability exceeding the estimated ranges of loss and amounts accrued. | |
Environmental Matters | |
Pennsylvania Department of Environmental Protection | |
On December 15, 2010, the Company entered into a consent order and settlement agreement (CO&SA) with the Pennsylvania Department of Environmental Protection (PaDEP), addressing a number of environmental issues originally identified in 2008 and 2009, including alleged releases of drilling mud and other substances, alleged record keeping violations at various wells and alleged natural gas contamination of water supplies to 14 households in Susquehanna County, Pennsylvania. During 2010 and 2011, the Company paid a total of $1.3 million in settlement of fines and penalties sought or claimed by the PaDEP related to this matter. On January 11, 2011, certain of the affected households appealed the CO&SA to the Pennsylvania Environmental Hearing Board (PEHB). On October 17, 2011, the Company requested PaDEP approval to resume hydraulic fracturing and new natural gas well drilling operations in the affected area, along with a request to cease temporary water deliveries to the affected households pursuant to prior consent orders with the PaDEP. The PaDEP concurred that temporary water deliveries to the property owners are no longer necessary. On November 18, 2011, certain of the affected households appealed this order to the PEHB, which appeal was later consolidated with the CO&SA appeal. All appellants have accepted their portion of the $2.2 million that was placed into escrow in 2011 for their benefit and on October 18, 2012 had dismissed their appeal to the PEHB. Subsequent to the withdrawal of the appeals, the PEHB allowed three groups of appellants to reinstate their appeal. It is expected that the PEHB will hold a hearing with respect to the appellants’ appeal in the first quarter of 2014. | |
The Company is in continuing discussions with the PaDEP to address the results of the Company’s natural gas well test data, water quality sampling and water well headspace screenings, which were required pursuant to the CO&SA. On August 21, 2012, the PaDEP notified the Company that it could commence completion operations on existing wells within the concerned area. |
DERIVATIVE_INSTRUMENTS_AND_HED
DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES | 9 Months Ended | |||||||||||||||||||||
Sep. 30, 2013 | ||||||||||||||||||||||
DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES | ||||||||||||||||||||||
DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES | 7. DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES | |||||||||||||||||||||
The Company periodically enters into commodity derivative instruments to hedge its exposure to price fluctuations related to its natural gas and crude oil production. The Company’s credit agreement restricts the ability of the Company to enter into commodity hedges other than to hedge or mitigate risks to which the Company has actual or projected exposure or as permitted under the Company’s risk management policies and where such derivatives do not subject the Company to material speculative risks. All of the Company’s derivatives are used for risk management purposes and are not held for trading purposes. | ||||||||||||||||||||||
As of September 30, 2013, the Company had the following outstanding commodity derivatives: | ||||||||||||||||||||||
Collars | Swaps | |||||||||||||||||||||
Floor | Ceiling | |||||||||||||||||||||
Type of Contract | Volume | Contract Period | Range | Weighted- | Range | Weighted- | Weighted- | |||||||||||||||
Average | Average | Average | ||||||||||||||||||||
Collar Agreements | ||||||||||||||||||||||
Natural gas | 4.5 | Bcf | Oct. 2013 - Dec. 2013 | $ | — | $ | 5.15 | $6.18-$6.23 | $ | 6.2 | ||||||||||||
Natural gas | 54.5 | Bcf | Oct. 2013 - Dec. 2013 | $3.09-$4.37 | $ | 3.63 | $3.98-$5.02 | $ | 4.27 | |||||||||||||
Natural gas | 44.4 | Bcf | Oct. 2013 - Dec. 2014 | $3.60-$3.96 | $ | 3.78 | $4.55-$4.59 | $ | 4.57 | |||||||||||||
Natural gas | 124.1 | Bcf | Jan. 2014 - Dec. 2014 | $3.86-$4.37 | $ | 4.19 | $4.63-$4.80 | $ | 4.7 | |||||||||||||
Swap Agreements | ||||||||||||||||||||||
Crude oil | 276 | Mbbl | Oct. 2013 - Dec. 2013 | $ | 101.9 | |||||||||||||||||
Natural gas prices are stated per Mcf and crude oil prices are stated per barrel. | ||||||||||||||||||||||
The changes in the fair value of derivatives designated as hedges that are effective are recorded to accumulated other comprehensive income / (loss) in stockholders’ equity in the Condensed Consolidated Balance Sheet. The ineffective portion of the change in fair value of derivatives designated as hedges, if any, and the change in fair value of derivatives not designated as hedges are recorded currently in earnings as a component of natural gas revenue and crude oil and condensate revenue in the Condensed Consolidated Statement of Operations. | ||||||||||||||||||||||
The following disclosures reflect the impact of derivative instruments on the Company’s condensed consolidated financial statements: | ||||||||||||||||||||||
Effect of Derivative Instruments on the Condensed Consolidated Balance Sheet | ||||||||||||||||||||||
Fair Values of Derivative Instruments | ||||||||||||||||||||||
Derivative Assets | Derivative Liabilities | |||||||||||||||||||||
(In thousands) | Balance Sheet Location | September 30, | December 31, | September 30, | December 31, | |||||||||||||||||
2013 | 2012 | 2013 | 2012 | |||||||||||||||||||
Derivatives Designated as Hedging Instruments | ||||||||||||||||||||||
Commodity contracts | Derivative instruments (current assets) | $ | 56,831 | $ | 50,824 | $ | — | $ | — | |||||||||||||
Commodity contracts | Derivative instruments (non-current assets) | 8,708 | — | — | — | |||||||||||||||||
Commodity contracts | Accrued Liabilities | — | — | — | 192 | |||||||||||||||||
$ | 65,539 | $ | 50,824 | $ | — | $ | 192 | |||||||||||||||
At September 30, 2013 and December 31, 2012, unrealized gains of $65.5 million ($39.8 million, net of tax) and $50.6 million ($30.7 million, net of tax), respectively, were recorded in accumulated other comprehensive income / (loss) in stockholder’s equity in the Condensed Consolidated Balance Sheet. Based upon estimates at September 30, 2013, the Company expects to reclassify $34.5 million in after-tax income associated with its commodity hedges from accumulated other comprehensive income / (loss) to the Condensed Consolidated Statement of Operations over the next 12 months. | ||||||||||||||||||||||
Offsetting of Derivative Assets and Liabilities in the Condensed Consolidated Balance Sheet | ||||||||||||||||||||||
(In thousands) | September 30, | December 31, | ||||||||||||||||||||
2013 | 2012 | |||||||||||||||||||||
Derivative Assets | ||||||||||||||||||||||
Gross amounts of recognized assets | $ | 66,473 | $ | 54,454 | ||||||||||||||||||
Gross amounts offset in the statement of financial position | (934 | ) | (3,630 | ) | ||||||||||||||||||
Net amounts of assets presented in the statement of financial position | 65,539 | 50,824 | ||||||||||||||||||||
Gross amounts of financial instruments not offset in the statement of financial position | — | 1,892 | ||||||||||||||||||||
Net amount | $ | 65,539 | $ | 52,716 | ||||||||||||||||||
Derivative Liabilities | ||||||||||||||||||||||
Gross amounts of recognized liabilities | $ | 934 | $ | 3,822 | ||||||||||||||||||
Gross amounts offset in the statement of financial position | (934 | ) | (3,630 | ) | ||||||||||||||||||
Net amounts of liabilities presented in the statement of financial position | — | 192 | ||||||||||||||||||||
Gross amounts of financial instruments not offset in the statement of financial position | 390 | — | ||||||||||||||||||||
Net amount | $ | 390 | $ | 192 | ||||||||||||||||||
Effect of Derivative Instruments on the Condensed Consolidated Statement of Operations | ||||||||||||||||||||||
Derivatives Designated as Hedging Instruments | ||||||||||||||||||||||
Amount of Gain (Loss) Recognized in OCI on Derivatives | ||||||||||||||||||||||
(Effective Portion) | ||||||||||||||||||||||
Three Months Ended | Nine Months Ended | |||||||||||||||||||||
September 30, | September 30, | |||||||||||||||||||||
(In thousands) | 2013 | 2012 | 2013 | 2012 | ||||||||||||||||||
Commodity Contracts | $ | (2,384 | ) | $ | (39,805 | ) | $ | 51,783 | $ | 49,299 | ||||||||||||
Amount of Gain (Loss) Reclassified from Accumulated OCI into | ||||||||||||||||||||||
Income (Effective Portion) | ||||||||||||||||||||||
Location of Gain (Loss) Reclassified | Three Months Ended | Nine Months Ended | ||||||||||||||||||||
September 30, | September 30, | |||||||||||||||||||||
from Accumulated OCI into Income | 2013 | 2012 | 2013 | 2012 | ||||||||||||||||||
Natural gas revenues | $ | 20,766 | $ | 57,139 | $ | 33,822 | $ | 183,867 | ||||||||||||||
Crude oil and condensate revenues | (1,082 | ) | 3,799 | 3,054 | 5,583 | |||||||||||||||||
$ | 19,684 | $ | 60,938 | $ | 36,876 | $ | 189,450 | |||||||||||||||
For the three and nine months ended September 30, 2013 and 2012, respectively, there was no ineffectiveness recorded in the Company’s Condensed Consolidated Statement of Operations related to its derivative instruments designated as hedges. | ||||||||||||||||||||||
Derivatives Not Designated as Hedging Instruments | ||||||||||||||||||||||
Location of Gain (Loss) | Three Months Ended | Nine Months Ended | ||||||||||||||||||||
Recognized in Income on | September 30, | September 30, | ||||||||||||||||||||
(In thousands) | Derivatives | 2013 | 2012 | 2013 | 2012 | |||||||||||||||||
Commodity Contracts | Natural gas revenues | $ | — | $ | (149 | ) | $ | — | $ | (449 | ) | |||||||||||
Additional Disclosures about Derivative Instruments and Hedging Activities | ||||||||||||||||||||||
The use of derivative instruments involves the risk that the counterparties will be unable to meet their obligation under the agreement. The Company enters into derivative contracts with multiple counterparties in order to limit its exposure to individual counterparties. The Company also has netting arrangements with each of its counterparties that allow it to offset assets and liabilities from separate derivative contracts with that counterparty. | ||||||||||||||||||||||
Certain counterparties to the Company’s derivative instruments are also lenders under its credit facility. The Company’s credit facility and derivative instruments contain certain cross default and acceleration provisions that may require immediate payment of its derivative liabilities in certain situations. |
FAIR_VALUE_MEASUREMENTS
FAIR VALUE MEASUREMENTS | 9 Months Ended | |||||||||||||
Sep. 30, 2013 | ||||||||||||||
FAIR VALUE MEASUREMENTS | ||||||||||||||
FAIR VALUE MEASUREMENTS | 8. FAIR VALUE MEASUREMENTS | |||||||||||||
The Company follows the authoritative guidance for measuring fair value of assets and liabilities in its financial statements. The authoritative guidance also established a formal fair value hierarchy based on the inputs used to measure fair value. The hierarchy gives the highest priority to Level 1 measurements and the lowest priority to Level 3 measurements. The Company has classified its assets and liabilities into these levels depending upon the data relied on to determine the fair values. For further information regarding the fair value hierarchy, refer to Note 14 of the Notes to the Consolidated Financial Statements in the Form 10-K. | ||||||||||||||
Non-Financial Assets and Liabilities | ||||||||||||||
The Company discloses or recognizes its non-financial assets and liabilities, such as impairments of long-lived assets, at fair value on a nonrecurring basis. As none of the Company’s non-financial assets and liabilities were impaired as of September 30, 2013 and 2012 and no other assets or liabilities were required to be measured at fair value on a non-recurring basis, additional disclosures were not provided. | ||||||||||||||
The estimated fair value of the Company’s asset retirement obligation at inception is determined by utilizing the income approach by applying a credit-adjusted risk-free rate, which takes into account the Company’s credit risk, the time value of money, and the current economic state, to the undiscounted expected abandonment cash flows. Given the unobservable nature of the inputs, the measurement of the asset retirement obligation is deemed to use Level 3 inputs. | ||||||||||||||
Financial Assets and Liabilities | ||||||||||||||
The following fair value hierarchy table presents information about the Company’s financial assets and liabilities measured at fair value on a recurring basis: | ||||||||||||||
(In thousands) | Quoted Prices in | Significant | Significant | September 30, | ||||||||||
Active Markets | Other | Unobservable | 2013 | |||||||||||
for Identical | Observable | Inputs | ||||||||||||
Assets | Inputs | (Level 3) | ||||||||||||
(Level 1) | (Level 2) | |||||||||||||
Assets | ||||||||||||||
Deferred compensation plan | $ | 11,865 | $ | — | $ | — | $ | 11,865 | ||||||
Derivative instruments | — | 93 | 65,446 | 65,539 | ||||||||||
Total assets | $ | 11,865 | $ | 93 | $ | 65,446 | $ | 77,404 | ||||||
Liabilities | ||||||||||||||
Deferred compensation plan | $ | 31,800 | $ | — | $ | — | $ | 31,800 | ||||||
Total liabilities | $ | 31,800 | $ | — | $ | — | $ | 31,800 | ||||||
(In thousands) | Quoted Prices in | Significant | Significant | December 31, | ||||||||||
Active Markets | Other | Unobservable | 2012 | |||||||||||
for Identical | Observable | Inputs | ||||||||||||
Assets | Inputs | (Level 3) | ||||||||||||
(Level 1) | (Level 2) | |||||||||||||
Assets | ||||||||||||||
Deferred compensation plan | $ | 10,608 | $ | — | $ | — | $ | 10,608 | ||||||
Derivative instruments | — | 9,473 | 41,351 | 50,824 | ||||||||||
Total assets | $ | 10,608 | $ | 9,473 | $ | 41,351 | $ | 61,432 | ||||||
Liabilities | ||||||||||||||
Deferred compensation plan | $ | 23,893 | $ | — | $ | — | $ | 23,893 | ||||||
Derivative instruments | — | — | 192 | 192 | ||||||||||
Total liabilities | $ | 23,893 | $ | — | $ | 192 | $ | 24,085 | ||||||
The Company’s investments associated with its deferred compensation plan consist of mutual funds and deferred shares of the Company’s common stock that are publicly traded and for which market prices are readily available. | ||||||||||||||
The derivative instruments were measured based on quotes from the Company’s counterparties. Such quotes have been derived using an income approach that considers various inputs including current market and contractual prices for the underlying instruments, quoted forward prices for natural gas and crude oil, basis differentials, volatility factors and interest rates, such as a LIBOR curve for a similar length of time as the derivative contract term as applicable. Estimates are verified using relevant NYMEX futures contracts and/or are compared to multiple quotes obtained from counterparties for reasonableness. The determination of the fair values presented above also incorporates a credit adjustment for non-performance risk. The Company measured the non-performance risk of its counterparties by reviewing credit default swap spreads for the various financial institutions with which it has derivative transactions, while non-performance risk of the Company is evaluated using a market credit spread provided by the Company’s bank. | ||||||||||||||
The significant unobservable inputs for Level 3 derivative contracts include basis differentials and volatility factors. An increase (decrease) in these unobservable inputs would result in an increase (decrease) in fair value, respectively. The Company does not have access to the specific assumptions used in its counterparties’ valuation models. Consequently, additional disclosures regarding significant Level 3 unobservable inputs were not provided. | ||||||||||||||
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: | ||||||||||||||
Three Months Ended | Nine Months Ended | |||||||||||||
September 30, | September 30, | |||||||||||||
(In thousands) | 2013 | 2012 | 2013 | 2012 | ||||||||||
Balance at beginning of period | $ | 83,878 | $ | 129,213 | $ | 41,159 | $ | 195,127 | ||||||
Total gains / (losses) (realized or unrealized): | ||||||||||||||
Included in earnings (1) | 20,766 | 56,990 | 33,822 | 183,418 | ||||||||||
Included in other comprehensive income | (18,432 | ) | (85,466 | ) | 24,287 | (153,008 | ) | |||||||
Settlements | (20,766 | ) | (55,915 | ) | (33,822 | ) | (181,100 | ) | ||||||
Transfers in and/or out of level 3 | — | — | — | 385 | ||||||||||
Balance at end of period | $ | 65,446 | $ | 44,822 | $ | 65,446 | $ | 44,822 | ||||||
(1) There were no unrealized gains or losses for the three and nine months ended September 30, 2013. Unrealized losses of $0.1 million and $0.4 million for the three and nine months ended September 30, 2012, respectively, were included in natural gas revenues in the Condensed Consolidated Statement of Operations. | ||||||||||||||
There were no transfers between Level 1 and Level 2 measurements for the three and nine months ended September 30, 2013 and 2012. | ||||||||||||||
Fair Value of Other Financial Instruments | ||||||||||||||
The estimated fair value of financial instruments is the amount at which the instrument could be exchanged currently between willing parties. The carrying amounts reported in the Condensed Consolidated Balance Sheet for cash and cash equivalents, accounts receivable and accounts payable approximate fair value due to the short-term maturities of these instruments. | ||||||||||||||
The fair value of long-term debt is the estimated amount the Company would have to pay a third party to assume the debt, including a credit spread for the difference between the issue rate and the period end market rate. The credit spread is the Company’s default or repayment risk. The credit spread (premium or discount) is determined by comparing the Company’s fixed-rate notes and credit facility to new issuances (secured and unsecured) and secondary trades of similar size and credit statistics for both public and private debt. The fair value of all fixed-rate notes and the credit facility is based on interest rates currently available to the Company. The Company’s long-term debt is valued using an income approach and classified as Level 3 in the fair value hierarchy due to the unobservable nature of the inputs. | ||||||||||||||
The Company uses available market data and valuation methodologies to estimate the fair value of debt. The carrying amounts and fair values of long-term debt are as follows: | ||||||||||||||
September 30, 2013 | December 31, 2012 | |||||||||||||
(In thousands) | Carrying | Estimated Fair | Carrying | Estimated Fair | ||||||||||
Amount | Value | Amount | Value | |||||||||||
Total debt | $ | 1,162,000 | $ | 1,258,627 | $ | 1,087,000 | $ | 1,213,474 | ||||||
Current maturities | — | — | (75,000 | ) | (77,175 | ) | ||||||||
Long-term debt, excluding current maturities | $ | 1,162,000 | $ | 1,258,627 | $ | 1,012,000 | $ | 1,136,299 |
ACCUMULATED_OTHER_COMPREHENSIV
ACCUMULATED OTHER COMPREHENSIVE INCOME / (LOSS) | 9 Months Ended | ||||||||||
Sep. 30, 2013 | |||||||||||
ACCUMULATED OTHER COMPREHENSIVE INCOME / (LOSS) | |||||||||||
ACCUMULATED OTHER COMPREHENSIVE INCOME / (LOSS) | 9. ACCUMULATED OTHER COMPREHENSIVE INCOME / (LOSS) | ||||||||||
Changes in accumulated other comprehensive income / (loss) by component, net of tax, were as follows: | |||||||||||
(In thousands) | Net Gains / | Postretirement | Total | ||||||||
(Losses) on Cash | Benefits | ||||||||||
Flow Hedges | |||||||||||
Balance at December 31, 2012 | $ | 30,717 | $ | (6,837 | ) | $ | 23,880 | ||||
Other comprehensive income before reclassifications | 31,417 | — | 31,417 | ||||||||
Amounts reclassified from accumulated other comprehensive income | (22,372 | ) | 319 | (22,053 | ) | ||||||
Net current-period other comprehensive income | 9,045 | 319 | 9,364 | ||||||||
Balance at September 30, 2013 | $ | 39,762 | $ | (6,518 | ) | $ | 33,244 | ||||
Amounts reclassified from accumulated other comprehensive income / (loss) into the Condensed Consolidated Statement of Operations were as follows: | |||||||||||
(In thousands) | Three Months Ended | Nine Months Ended | Affected Line Item in the | ||||||||
September 30, 2013 | September 30, 2013 | Condensed Consolidated | |||||||||
Statement of Operations | |||||||||||
Net gains / (losses) on cash flow hedges | |||||||||||
Commodity contracts | $ | 20,766 | $ | 33,822 | Natural gas revenues | ||||||
Commodity contracts | (1,082 | ) | 3,054 | Crude oil and condensate revenues | |||||||
Postretirement benefits | |||||||||||
Amortization of net loss | (116 | ) | (525 | ) | General and administrative expense | ||||||
19,568 | 36,351 | Total before tax | |||||||||
(7,696 | ) | (14,298 | ) | Tax (expense) / benefit | |||||||
Total reclassifications for the period | $ | 11,872 | $ | 22,053 | Net of tax |
PENSION_AND_POSTRETIREMENT_BEN
PENSION AND POSTRETIREMENT BENEFITS | 9 Months Ended | |||||||||||||
Sep. 30, 2013 | ||||||||||||||
PENSION AND POSTRETIREMENT BENEFITS | ||||||||||||||
PENSION AND POSTRETIREMENT BENEFITS | 10. PENSION AND POSTRETIREMENT BENEFITS | |||||||||||||
The components of net periodic benefit costs, included in general and administrative expense in the Condensed Consolidated Statement of Operations, were as follows: | ||||||||||||||
Three Months Ended | Nine Months Ended | |||||||||||||
September 30, | September 30, | |||||||||||||
(In thousands) | 2013 | 2012 | 2013 | 2012 | ||||||||||
Qualified Pension Plan (1) | ||||||||||||||
Interest cost | $ | — | $ | — | $ | — | $ | 922 | ||||||
Expected return on plan assets | — | — | — | (1,748 | ) | |||||||||
Settlement | — | — | — | 7,111 | ||||||||||
Amortization of prior service cost | — | — | — | 221 | ||||||||||
Amortization of net loss | — | — | — | 13,083 | ||||||||||
Net periodic pension cost | $ | — | $ | — | $ | — | $ | 19,589 | ||||||
Postretirement Benefits | ||||||||||||||
Service cost | $ | 455 | $ | 234 | $ | 1,285 | $ | 1,280 | ||||||
Interest cost | 355 | 351 | 1,145 | 1,187 | ||||||||||
Amortization of net loss | 116 | 132 | 525 | 692 | ||||||||||
Total postretirement benefit cost | $ | 926 | $ | 717 | $ | 2,955 | $ | 3,159 | ||||||
(1) On July 13, 2012, the Company made a final distribution of benefits from the qualified pension plan. |
STOCKBASED_COMPENSATION
STOCK-BASED COMPENSATION | 9 Months Ended | ||||||
Sep. 30, 2013 | |||||||
STOCK-BASED COMPENSATION | |||||||
STOCK-BASED COMPENSATION | 11. STOCK-BASED COMPENSATION | ||||||
Stock-based compensation expense during the first nine months of 2013 and 2012 was $41.0 million and $23.4 million, respectively, and is included in general and administrative expense in the Condensed Consolidated Statement of Operations. Stock-based compensation expense in the third quarter of 2013 and 2012 was $12.2 million and $10.4 million, respectively. | |||||||
Restricted Stock Awards | |||||||
During the first nine months of 2013, 5,700 restricted stock awards were granted to employees with a weighted-average grant date per share value of $35.56. The fair value of restricted stock grants is based on the average of the high and low stock price on the grant date. The Company used an annual forfeiture rate assumption of 6.0% for purposes of recognizing stock-based compensation expense for restricted stock awards. | |||||||
Restricted Stock Units | |||||||
During the first nine months of 2013, 49,042 restricted stock units were granted to non-employee directors of the Company with a weighted-average grant date per unit value of $27.19. The fair value of these units is measured based on the average of the high and low stock price on grant date and compensation expense is recorded immediately. These units immediately vest and will be issued when the director ceases to be a director of the Company. | |||||||
Performance Share Awards | |||||||
During the first nine months of 2013, three types of performance share awards were granted to employees for a total of 804,500 performance shares, which included 549,520 performance share awards based on performance conditions measured against the Company’s internal performance metrics and 254,980 performance share awards based on market conditions. The Company used an annual forfeiture rate assumption ranging from 0% to 6% for purposes of recognizing stock-based compensation expense for its performance share awards. The performance period for the awards granted in 2013 commenced on January 1, 2013 and ends on December 31, 2015. Refer to Note 12 of the Notes to the Consolidated Financial Statements in the Form 10-K for further description of the various types of performance share awards. | |||||||
Awards Based on Performance Conditions. The performance awards based on internal metrics had a grant date per share value of $26.62, which is based on the average of the high and low stock price on the grant date. These awards represent the right to receive up to 100% of the award in shares of common stock. Of the 549,520 performance awards granted based on internal metrics, 169,980 shares have a three-year graded performance period. For these shares, 25% of the shares vest on each of the first and second anniversary dates following the date of the grant and 50% of the shares vest on the third anniversary date following the date of the grant, provided that the Company has $100 million or more of operating cash flow for the year preceding the vesting date. If the Company does not meet this metric for the applicable period, then the portion of the performance shares that would have been issued on that anniversary date will be forfeited. | |||||||
For the remaining 379,540 performance awards, the actual number of shares issued at the end of the performance period will be determined based on the Company’s performance against three performance criteria set by the Company’s Compensation Committee. An employee will earn one-third of the award granted for each internal performance metric that the Company meets at the end of the performance period. These performance criteria are based on the Company’s average production, average finding costs and average reserve replacement over the three-year performance period. | |||||||
Based on the Company’s probability assessment at September 30, 2013, it is considered probable that the criteria for the performance awards based on performance conditions will be met. | |||||||
Awards Based on Market Conditions. The 254,980 performance shares based on market conditions are earned, or not earned, based on the comparative performance of the Company’s common stock measured against fifteen other companies in the Company’s peer group over a three-year performance period. These performance shares have both an equity and liability component. The equity portion of the 2013 awards was valued on the grant date (February 21, 2013) and is not marked to market. The liability portion of the awards was valued as of September 30, 2013 on a mark-to-market basis. | |||||||
The following assumptions were used to determine the grant date fair value of the equity component and the period-end fair value of the liability component of the Company’s performance share awards based on market conditions using a Monte Carlo model: | |||||||
Grant Date | September 30, 2013 | ||||||
Value per Share | $ | 23.06 | $22.17 - $36.98 | ||||
Assumptions: | |||||||
Stock Price Volatility | 43.80% | 26.2% - 42.8% | |||||
Risk Free Rate of Return | 0.40% | 0.0% - 0.4% | |||||
Expected Dividend Yield | 0.20% | 0.10% | |||||
Supplemental Employee Incentive Plan | |||||||
On May 1, 2012, the Company’s Board of Directors adopted the Supplemental Employee Incentive Plan III (SEIP III) to replace the previously adopted Supplemental Employee Incentive Plan II that expired on June 30, 2012. For further information regarding the terms of the SEIP III, refer to Note 12 of the Notes to the Consolidated Financial Statements in the Form 10-K. The Company recognized stock-based compensation expense of $4.1 million and $1.6 million for the three months ended September 30, 2013 and 2012 and $9.2 million and a benefit of $0.1 million for the nine months ended September 30, 2013 and 2012, respectively, which is included in general and administrative expense in the Condensed Consolidated Statement of Operations. | |||||||
On February 11, 2013, the Company achieved the price goal of $25 per share prior to the interim trigger date. Accordingly, a total distribution of approximately $6.8 million was made to the Company’s eligible employees under the SEIP III, of which 25% of the total distribution, or $1.7 million, was paid in February 2013 and the remaining 75%, or $5.1 million, was deferred until August 2014 in accordance with the SEIP III. | |||||||
On August 27, 2013, the Company achieved the price goal of $37.50 per share prior to the final trigger date. Accordingly, a total distribution of approximately $11.1 million was made to the Company’s eligible employees under the SEIP III, of which 25% of the total distribution, or $2.8 million, was paid in September 2013 and the remaining 75%, or $8.3 million, was deferred until August 2014 in accordance with the SEIP III. | |||||||
On September 19, 2013, the Company’s Board of Directors adopted the Supplemental Employee Incentive Plan IV (SEIP IV) to replace the SEIP III with an effective date of October 1, 2013. The SEIP IV provides for a payout if, for any 20 trading days out of any 60 consecutive trading days, the closing price per share of the Company’s common stock equals or exceeds the price goal of $55 per share by September 30, 2015 (interim trigger date) or $80 per share by September 30, 2017 (final trigger date). The remaining provisions of the SEIP IV are consistent with the provisions of the SEIP III as disclosed in Note 12 of the Notes to the Consolidated Financial Statements in the Form 10-K. |
ASSET_RETIREMENT_OBLIGATION
ASSET RETIREMENT OBLIGATION | 9 Months Ended | ||||
Sep. 30, 2013 | |||||
ASSET RETIREMENT OBLIGATION | |||||
ASSET RETIREMENT OBLIGATION | 12. ASSET RETIREMENT OBLIGATION | ||||
Activity related to the Company’s asset retirement obligation is as follows: | |||||
(In thousands) | |||||
Balance at December 31, 2012 | $ | 67,016 | |||
Liabilities incurred | 3,945 | ||||
Liabilities settled | (800 | ) | |||
Liabilities divested | (341 | ) | |||
Accretion expense | 2,705 | ||||
Balance at September 30, 2013 | $ | 72,525 | |||
As of September 30, 2013, approximately $2.0 million, which represents the current portion of the Company’s asset retirement obligation, is included in accrued liabilities in the Condensed Consolidated Balance Sheet. |
PROPERTIES_AND_EQUIPMENT_NET_T
PROPERTIES AND EQUIPMENT, NET (Tables) | 9 Months Ended | |||||||
Sep. 30, 2013 | ||||||||
PROPERTIES AND EQUIPMENT, NET | ||||||||
Components of net properties and equipment | ||||||||
September 30, | December 31, | |||||||
(In thousands) | 2013 | 2012 | ||||||
Proved oil and gas properties | $ | 6,522,753 | $ | 5,724,940 | ||||
Unproved oil and gas properties | 444,353 | 467,483 | ||||||
Gathering and pipeline systems | 240,285 | 239,656 | ||||||
Land, building and other equipment | 92,740 | 86,137 | ||||||
7,300,131 | 6,518,216 | |||||||
Accumulated depreciation, depletion and amortization | (2,609,955 | ) | (2,207,239 | ) | ||||
$ | 4,690,176 | $ | 4,310,977 |
ADDITIONAL_BALANCE_SHEET_INFOR1
ADDITIONAL BALANCE SHEET INFORMATION (Tables) | 9 Months Ended | |||||||
Sep. 30, 2013 | ||||||||
ADDITIONAL BALANCE SHEET INFORMATION | ||||||||
Additional Balance Sheet Information | ||||||||
September 30, | December 31, | |||||||
(In thousands) | 2013 | 2012 | ||||||
Accounts receivable, net | ||||||||
Trade accounts | $ | 173,096 | $ | 165,070 | ||||
Joint interest accounts | 5,452 | 5,659 | ||||||
Other accounts | 1,612 | 2,817 | ||||||
180,160 | 173,546 | |||||||
Allowance for doubtful accounts | (1,681 | ) | (1,127 | ) | ||||
$ | 178,479 | $ | 172,419 | |||||
Inventories | ||||||||
Natural gas in storage | $ | 11,732 | $ | 7,494 | ||||
Tubular goods and well equipment | 9,136 | 6,392 | ||||||
Other accounts | (29 | ) | 287 | |||||
$ | 20,839 | $ | 14,173 | |||||
Other current assets | ||||||||
Prepaid balances and other | 3,703 | 2,158 | ||||||
$ | 3,703 | $ | 2,158 | |||||
Other assets | ||||||||
Deferred compensation plan | $ | 11,865 | $ | 10,608 | ||||
Debt issuance cost | 14,652 | 17,420 | ||||||
Equity method investment | 16,154 | 6,915 | ||||||
Other accounts | 81 | 83 | ||||||
$ | 42,752 | $ | 35,026 | |||||
Accounts payable | ||||||||
Trade accounts | $ | 24,295 | $ | 5,097 | ||||
Natural gas purchases | 6,389 | 4,892 | ||||||
Royalty and other owners | 75,896 | 66,321 | ||||||
Accrued capital costs | 175,828 | 164,862 | ||||||
Taxes other than income | 10,479 | 19,164 | ||||||
Drilling advances | 35,686 | 44,203 | ||||||
Producer gas imbalances | 1,381 | 1,602 | ||||||
Other accounts | 5,395 | 6,339 | ||||||
$ | 335,349 | $ | 312,480 | |||||
Accrued liabilities | ||||||||
Employee benefits | $ | 32,870 | $ | 16,011 | ||||
Postretirement benefits | 1,304 | 1,304 | ||||||
Taxes other than income | 10,576 | 8,735 | ||||||
Interest payable | 11,560 | 22,329 | ||||||
Other accounts | 2,924 | 1,410 | ||||||
$ | 59,234 | $ | 49,789 | |||||
Other liabilities | ||||||||
Deferred compensation plan | $ | 31,800 | $ | 23,893 | ||||
Other accounts | 11,076 | 16,282 | ||||||
$ | 42,876 | $ | 40,175 |
DEBT_AND_CREDIT_AGREEMENTS_Tab
DEBT AND CREDIT AGREEMENTS (Tables) | 9 Months Ended | |||||||
Sep. 30, 2013 | ||||||||
DEBT AND CREDIT AGREEMENTS | ||||||||
Company's Long-Term Debt and credit agreements Components | ||||||||
(In thousands) | September 30, | December 31, | ||||||
2013 | 2012 | |||||||
Total debt | ||||||||
7.33% weighted-average fixed rate notes | $ | 20,000 | $ | 95,000 | ||||
6.51% weighted-average fixed rate notes | 425,000 | 425,000 | ||||||
9.78% notes | 67,000 | 67,000 | ||||||
5.58% weighted-average fixed rate notes | 175,000 | 175,000 | ||||||
Credit facility | 475,000 | 325,000 | ||||||
Current maturities | ||||||||
7.33% weighted-average fixed rate notes | — | (75,000 | ) | |||||
Long-term debt, excluding current maturities | $ | 1,162,000 | $ | 1,012,000 |
EARNINGS_PER_COMMON_SHARE_Tabl
EARNINGS PER COMMON SHARE (Tables) | 9 Months Ended | |||||||||
Sep. 30, 2013 | ||||||||||
EARNINGS PER COMMON SHARE | ||||||||||
Calculation of basic and diluted weighted-average shares outstanding | ||||||||||
Three Months Ended | Nine Months Ended | |||||||||
September 30, | September 30, | |||||||||
(In thousands) | 2013 | 2012 | 2013 | 2012 | ||||||
Weighted-average shares - basic | 420,986 | 419,312 | 420,664 | 418,866 | ||||||
Dilution effect of stock appreciation rights and stock awards at end of period | 2,467 | 3,140 | 2,160 | 3,128 | ||||||
Weighted-average shares - diluted | 423,453 | 422,452 | 422,824 | 421,994 | ||||||
Weighted-average shares excluded from diluted earnings per share due to the anti-dilutive effect | 1 | 92 | 3 | 204 |
DERIVATIVE_INSTRUMENTS_AND_HED1
DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES (Tables) | 9 Months Ended | |||||||||||||||||||||
Sep. 30, 2013 | ||||||||||||||||||||||
DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES | ||||||||||||||||||||||
Outstanding Commodity Derivatives | As of September 30, 2013, the Company had the following outstanding commodity derivatives: | |||||||||||||||||||||
Collars | Swaps | |||||||||||||||||||||
Floor | Ceiling | |||||||||||||||||||||
Type of Contract | Volume | Contract Period | Range | Weighted- | Range | Weighted- | Weighted- | |||||||||||||||
Average | Average | Average | ||||||||||||||||||||
Collar Agreements | ||||||||||||||||||||||
Natural gas | 4.5 | Bcf | Oct. 2013 - Dec. 2013 | $ | — | $ | 5.15 | $6.18-$6.23 | $ | 6.2 | ||||||||||||
Natural gas | 54.5 | Bcf | Oct. 2013 - Dec. 2013 | $3.09-$4.37 | $ | 3.63 | $3.98-$5.02 | $ | 4.27 | |||||||||||||
Natural gas | 44.4 | Bcf | Oct. 2013 - Dec. 2014 | $3.60-$3.96 | $ | 3.78 | $4.55-$4.59 | $ | 4.57 | |||||||||||||
Natural gas | 124.1 | Bcf | Jan. 2014 - Dec. 2014 | $3.86-$4.37 | $ | 4.19 | $4.63-$4.80 | $ | 4.7 | |||||||||||||
Swap Agreements | ||||||||||||||||||||||
Crude oil | 276 | Mbbl | Oct. 2013 - Dec. 2013 | $ | 101.9 | |||||||||||||||||
Natural gas prices are stated per Mcf and crude oil prices are stated per barrel. | ||||||||||||||||||||||
Effect of Derivative Instruments on the Condensed Consolidated Balance Sheet | ||||||||||||||||||||||
Fair Values of Derivative Instruments | ||||||||||||||||||||||
Derivative Assets | Derivative Liabilities | |||||||||||||||||||||
(In thousands) | Balance Sheet Location | September 30, | December 31, | September 30, | December 31, | |||||||||||||||||
2013 | 2012 | 2013 | 2012 | |||||||||||||||||||
Derivatives Designated as Hedging Instruments | ||||||||||||||||||||||
Commodity contracts | Derivative instruments (current assets) | $ | 56,831 | $ | 50,824 | $ | — | $ | — | |||||||||||||
Commodity contracts | Derivative instruments (non-current assets) | 8,708 | — | — | — | |||||||||||||||||
Commodity contracts | Accrued Liabilities | — | — | — | 192 | |||||||||||||||||
$ | 65,539 | $ | 50,824 | $ | — | $ | 192 | |||||||||||||||
Schedule of offsetting of derivative assets and liabilities in the condensed consolidated balance sheet | ||||||||||||||||||||||
(In thousands) | September 30, | December 31, | ||||||||||||||||||||
2013 | 2012 | |||||||||||||||||||||
Derivative Assets | ||||||||||||||||||||||
Gross amounts of recognized assets | $ | 66,473 | $ | 54,454 | ||||||||||||||||||
Gross amounts offset in the statement of financial position | (934 | ) | (3,630 | ) | ||||||||||||||||||
Net amounts of assets presented in the statement of financial position | 65,539 | 50,824 | ||||||||||||||||||||
Gross amounts of financial instruments not offset in the statement of financial position | — | 1,892 | ||||||||||||||||||||
Net amount | $ | 65,539 | $ | 52,716 | ||||||||||||||||||
Derivative Liabilities | ||||||||||||||||||||||
Gross amounts of recognized liabilities | $ | 934 | $ | 3,822 | ||||||||||||||||||
Gross amounts offset in the statement of financial position | (934 | ) | (3,630 | ) | ||||||||||||||||||
Net amounts of liabilities presented in the statement of financial position | — | 192 | ||||||||||||||||||||
Gross amounts of financial instruments not offset in the statement of financial position | 390 | — | ||||||||||||||||||||
Net amount | $ | 390 | $ | 192 | ||||||||||||||||||
Effect of Derivatives Designated as Hedging Instruments on the Condensed Consolidated Statement of Operations | ||||||||||||||||||||||
Amount of Gain (Loss) Recognized in OCI on Derivatives | ||||||||||||||||||||||
(Effective Portion) | ||||||||||||||||||||||
Three Months Ended | Nine Months Ended | |||||||||||||||||||||
September 30, | September 30, | |||||||||||||||||||||
(In thousands) | 2013 | 2012 | 2013 | 2012 | ||||||||||||||||||
Commodity Contracts | $ | (2,384 | ) | $ | (39,805 | ) | $ | 51,783 | $ | 49,299 | ||||||||||||
Amount of Gain (Loss) Reclassified from Accumulated OCI into | ||||||||||||||||||||||
Income (Effective Portion) | ||||||||||||||||||||||
Location of Gain (Loss) Reclassified | Three Months Ended | Nine Months Ended | ||||||||||||||||||||
September 30, | September 30, | |||||||||||||||||||||
from Accumulated OCI into Income | 2013 | 2012 | 2013 | 2012 | ||||||||||||||||||
Natural gas revenues | $ | 20,766 | $ | 57,139 | $ | 33,822 | $ | 183,867 | ||||||||||||||
Crude oil and condensate revenues | (1,082 | ) | 3,799 | 3,054 | 5,583 | |||||||||||||||||
$ | 19,684 | $ | 60,938 | $ | 36,876 | $ | 189,450 | |||||||||||||||
Effect of Derivatives Not Designated as Hedging Instruments on the Condensed Consolidated Statement of Operations | ||||||||||||||||||||||
Location of Gain (Loss) | Three Months Ended | Nine Months Ended | ||||||||||||||||||||
Recognized in Income on | September 30, | September 30, | ||||||||||||||||||||
(In thousands) | Derivatives | 2013 | 2012 | 2013 | 2012 | |||||||||||||||||
Commodity Contracts | Natural gas revenues | $ | — | $ | (149 | ) | $ | — | $ | (449 | ) | |||||||||||
FAIR_VALUE_MEASUREMENTS_Tables
FAIR VALUE MEASUREMENTS (Tables) | 9 Months Ended | |||||||||||||
Sep. 30, 2013 | ||||||||||||||
FAIR VALUE MEASUREMENTS | ||||||||||||||
Financial assets and liabilities measured at fair value on a recurring basis | ||||||||||||||
(In thousands) | Quoted Prices in | Significant | Significant | September 30, | ||||||||||
Active Markets | Other | Unobservable | 2013 | |||||||||||
for Identical | Observable | Inputs | ||||||||||||
Assets | Inputs | (Level 3) | ||||||||||||
(Level 1) | (Level 2) | |||||||||||||
Assets | ||||||||||||||
Deferred compensation plan | $ | 11,865 | $ | — | $ | — | $ | 11,865 | ||||||
Derivative instruments | — | 93 | 65,446 | 65,539 | ||||||||||
Total assets | $ | 11,865 | $ | 93 | $ | 65,446 | $ | 77,404 | ||||||
Liabilities | ||||||||||||||
Deferred compensation plan | $ | 31,800 | $ | — | $ | — | $ | 31,800 | ||||||
Total liabilities | $ | 31,800 | $ | — | $ | — | $ | 31,800 | ||||||
(In thousands) | Quoted Prices in | Significant | Significant | December 31, | ||||||||||
Active Markets | Other | Unobservable | 2012 | |||||||||||
for Identical | Observable | Inputs | ||||||||||||
Assets | Inputs | (Level 3) | ||||||||||||
(Level 1) | (Level 2) | |||||||||||||
Assets | ||||||||||||||
Deferred compensation plan | $ | 10,608 | $ | — | $ | — | $ | 10,608 | ||||||
Derivative instruments | — | 9,473 | 41,351 | 50,824 | ||||||||||
Total assets | $ | 10,608 | $ | 9,473 | $ | 41,351 | $ | 61,432 | ||||||
Liabilities | ||||||||||||||
Deferred compensation plan | $ | 23,893 | $ | — | $ | — | $ | 23,893 | ||||||
Derivative instruments | — | — | 192 | 192 | ||||||||||
Total liabilities | $ | 23,893 | $ | — | $ | 192 | $ | 24,085 | ||||||
Fair Value of Financial Assets and Liabilities Classified as Level 3 | ||||||||||||||
Three Months Ended | Nine Months Ended | |||||||||||||
September 30, | September 30, | |||||||||||||
(In thousands) | 2013 | 2012 | 2013 | 2012 | ||||||||||
Balance at beginning of period | $ | 83,878 | $ | 129,213 | $ | 41,159 | $ | 195,127 | ||||||
Total gains / (losses) (realized or unrealized): | ||||||||||||||
Included in earnings (1) | 20,766 | 56,990 | 33,822 | 183,418 | ||||||||||
Included in other comprehensive income | (18,432 | ) | (85,466 | ) | 24,287 | (153,008 | ) | |||||||
Settlements | (20,766 | ) | (55,915 | ) | (33,822 | ) | (181,100 | ) | ||||||
Transfers in and/or out of level 3 | — | — | — | 385 | ||||||||||
Balance at end of period | $ | 65,446 | $ | 44,822 | $ | 65,446 | $ | 44,822 | ||||||
(1) There were no unrealized gains or losses for the three and nine months ended September 30, 2013. Unrealized losses of $0.1 million and $0.4 million for the three and nine months ended September 30, 2012, respectively, were included in natural gas revenues in the Condensed Consolidated Statement of Operations. | ||||||||||||||
Carrying amounts and fair values of long-term debt | ||||||||||||||
September 30, 2013 | December 31, 2012 | |||||||||||||
(In thousands) | Carrying | Estimated Fair | Carrying | Estimated Fair | ||||||||||
Amount | Value | Amount | Value | |||||||||||
Total debt | $ | 1,162,000 | $ | 1,258,627 | $ | 1,087,000 | $ | 1,213,474 | ||||||
Current maturities | — | — | (75,000 | ) | (77,175 | ) | ||||||||
Long-term debt, excluding current maturities | $ | 1,162,000 | $ | 1,258,627 | $ | 1,012,000 | $ | 1,136,299 |
ACCUMULATED_OTHER_COMPREHENSIV1
ACCUMULATED OTHER COMPREHENSIVE INCOME / (LOSS) (Tables) | 9 Months Ended | ||||||||||
Sep. 30, 2013 | |||||||||||
ACCUMULATED OTHER COMPREHENSIVE INCOME / (LOSS) | |||||||||||
Changes in accumulated other comprehensive income / (loss) by component, net of tax | |||||||||||
(In thousands) | Net Gains / | Postretirement | Total | ||||||||
(Losses) on Cash | Benefits | ||||||||||
Flow Hedges | |||||||||||
Balance at December 31, 2012 | $ | 30,717 | $ | (6,837 | ) | $ | 23,880 | ||||
Other comprehensive income before reclassifications | 31,417 | — | 31,417 | ||||||||
Amounts reclassified from accumulated other comprehensive income | (22,372 | ) | 319 | (22,053 | ) | ||||||
Net current-period other comprehensive income | 9,045 | 319 | 9,364 | ||||||||
Balance at September 30, 2013 | $ | 39,762 | $ | (6,518 | ) | $ | 33,244 | ||||
Schedule of amount reclassified from accumulated other comprehensive income / (loss) into the Condensed Consolidated Statement of Operations | |||||||||||
(In thousands) | Three Months Ended | Nine Months Ended | Affected Line Item in the | ||||||||
September 30, 2013 | September 30, 2013 | Condensed Consolidated | |||||||||
Statement of Operations | |||||||||||
Net gains / (losses) on cash flow hedges | |||||||||||
Commodity contracts | $ | 20,766 | $ | 33,822 | Natural gas revenues | ||||||
Commodity contracts | (1,082 | ) | 3,054 | Crude oil and condensate revenues | |||||||
Postretirement benefits | |||||||||||
Amortization of net loss | (116 | ) | (525 | ) | General and administrative expense | ||||||
19,568 | 36,351 | Total before tax | |||||||||
(7,696 | ) | (14,298 | ) | Tax (expense) / benefit | |||||||
Total reclassifications for the period | $ | 11,872 | $ | 22,053 | Net of tax |
PENSION_AND_POSTRETIREMENT_BEN1
PENSION AND POSTRETIREMENT BENEFITS (Tables) | 9 Months Ended | |||||||||||||
Sep. 30, 2013 | ||||||||||||||
PENSION AND POSTRETIREMENT BENEFITS | ||||||||||||||
Components of net periodic benefit costs | ||||||||||||||
Three Months Ended | Nine Months Ended | |||||||||||||
September 30, | September 30, | |||||||||||||
(In thousands) | 2013 | 2012 | 2013 | 2012 | ||||||||||
Qualified Pension Plan (1) | ||||||||||||||
Interest cost | $ | — | $ | — | $ | — | $ | 922 | ||||||
Expected return on plan assets | — | — | — | (1,748 | ) | |||||||||
Settlement | — | — | — | 7,111 | ||||||||||
Amortization of prior service cost | — | — | — | 221 | ||||||||||
Amortization of net loss | — | — | — | 13,083 | ||||||||||
Net periodic pension cost | $ | — | $ | — | $ | — | $ | 19,589 | ||||||
Postretirement Benefits | ||||||||||||||
Service cost | $ | 455 | $ | 234 | $ | 1,285 | $ | 1,280 | ||||||
Interest cost | 355 | 351 | 1,145 | 1,187 | ||||||||||
Amortization of net loss | 116 | 132 | 525 | 692 | ||||||||||
Total postretirement benefit cost | $ | 926 | $ | 717 | $ | 2,955 | $ | 3,159 | ||||||
(1) On July 13, 2012, the Company made a final distribution of benefits from the qualified pension plan. |
STOCKBASED_COMPENSATION_Tables
STOCK-BASED COMPENSATION (Tables) (Performance Share Awards) | 9 Months Ended | ||||||
Sep. 30, 2013 | |||||||
Performance Share Awards | |||||||
Stock-Based Compensation arrangements | |||||||
Schedule of Value per Share and Assumptions Used | |||||||
Grant Date | September 30, 2013 | ||||||
Value per Share | $ | 23.06 | $22.17 - $36.98 | ||||
Assumptions: | |||||||
Stock Price Volatility | 43.80% | 26.2% - 42.8% | |||||
Risk Free Rate of Return | 0.40% | 0.0% - 0.4% | |||||
Expected Dividend Yield | 0.20% | 0.10% | |||||
ASSET_RETIREMENT_OBLIGATION_Ta
ASSET RETIREMENT OBLIGATION (Tables) | 9 Months Ended | ||||
Sep. 30, 2013 | |||||
ASSET RETIREMENT OBLIGATION | |||||
Asset Retirement Obligation | |||||
(In thousands) | |||||
Balance at December 31, 2012 | $ | 67,016 | |||
Liabilities incurred | 3,945 | ||||
Liabilities settled | (800 | ) | |||
Liabilities divested | (341 | ) | |||
Accretion expense | 2,705 | ||||
Balance at September 30, 2013 | $ | 72,525 |
FINANCIAL_STATEMENT_PRESENTATI1
FINANCIAL STATEMENT PRESENTATION (Details) | 0 Months Ended |
Jul. 23, 2013 | |
FINANCIAL STATEMENT PRESENTATION | |
Stockholders' Equity Note, Stock Split, Conversion Ratio | 2 |
PROPERTIES_AND_EQUIPMENT_NET_D
PROPERTIES AND EQUIPMENT, NET (Details) (USD $) | Sep. 30, 2013 | Dec. 31, 2012 |
In Thousands, unless otherwise specified | ||
PROPERTIES AND EQUIPMENT, NET | ||
Proved oil and gas properties | $6,522,753 | $5,724,940 |
Unproved oil and gas properties | 444,353 | 467,483 |
Gathering and pipeline systems | 240,285 | 239,656 |
Land, building and other equipment | 92,740 | 86,137 |
Properties and Equipment, gross, total | 7,300,131 | 6,518,216 |
Accumulated depreciation, depletion and amortization | -2,609,955 | -2,207,239 |
Properties and Equipment, Net | $4,690,176 | $4,310,977 |
PROPERTIES_AND_EQUIPMENT_NET_D1
PROPERTIES AND EQUIPMENT, NET (Details 2) | 9 Months Ended |
Sep. 30, 2013 | |
PROPERTIES AND EQUIPMENT, NET | |
Minimum term of capitalization of exploratory well costs | 1 year |
PROPERTIES_AND_EQUIPMENT_NET_D2
PROPERTIES AND EQUIPMENT, NET (Details 3) (USD $) | 3 Months Ended | 9 Months Ended | 1 Months Ended | ||||
Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | Jun. 30, 2012 | Oct. 31, 2013 | Oct. 31, 2013 | |
Pearsall shale | Oklahoma and Texas panhandles oil and gas properties | West Texas oil and gas properties | |||||
Subsequent event | Subsequent event | ||||||
Significant Acquisitions and Disposals | |||||||
Non-operated working interest (as a percent) | 35.00% | ||||||
Total consideration received from the sale of properties | $251,000,000 | $160,000,000 | $28,000,000 | ||||
Proceeds from sale of oil and gas properties | 125,000,000 | ||||||
Gain on sale of assets | 4,421,000 | -126,000 | 4,601,000 | 67,042,000 | 67,000,000 | ||
Percentage of fund for the Company's share of future drilling and completion costs | 85.00% | ||||||
Future drilling and completion costs to be funded by third party | $126,000,000 | ||||||
Drilling and completion carry | 2 years |
ADDITIONAL_BALANCE_SHEET_INFOR2
ADDITIONAL BALANCE SHEET INFORMATION (Details) (USD $) | 9 Months Ended | 12 Months Ended |
In Thousands, unless otherwise specified | Sep. 30, 2013 | Dec. 31, 2012 |
Accounts receivable, net | ||
Trade accounts | $173,096 | $165,070 |
Joint interest accounts | 5,452 | 5,659 |
Other accounts | 1,612 | 2,817 |
Accounts receivable, gross | 180,160 | 173,546 |
Allowance for doubtful accounts | -1,681 | -1,127 |
Accounts receivable, net | 178,479 | 172,419 |
Inventories | ||
Natural gas in storage | 11,732 | 7,494 |
Tubular goods and well equipment | 9,136 | 6,392 |
Other accounts | -29 | 287 |
Inventory, net | 20,839 | 14,173 |
Other current assets | ||
Prepaid balances and other | 3,703 | 2,158 |
Other assets current | 3,703 | 2,158 |
Other assets | ||
Deferred compensation plan | 11,865 | 10,608 |
Debt issuance costs | 14,652 | 17,420 |
Equity method investment | 16,154 | 6,915 |
Other accounts | 81 | 83 |
Other assets | 42,752 | 35,026 |
Accounts payable | ||
Trade accounts | 24,295 | 5,097 |
Natural gas purchases | 6,389 | 4,892 |
Royalty and other owners | 75,896 | 66,321 |
Accrued capital costs | 175,828 | 164,862 |
Taxes other than income | 10,479 | 19,164 |
Drilling advances | 35,686 | 44,203 |
Producer gas imbalances | 1,381 | 1,602 |
Other accounts | 5,395 | 6,339 |
Accounts payable current | 335,349 | 312,480 |
Accrued liabilities | ||
Employee benefits | 32,870 | 16,011 |
Postretirement benefits | 1,304 | 1,304 |
Taxes other than income | 10,576 | 8,735 |
Interest payable | 11,560 | 22,329 |
Other accounts | 2,924 | 1,410 |
Accrued liabilities | 59,234 | 49,789 |
Other liabilities | ||
Deferred compensation plan | 31,800 | 23,893 |
Other accounts | 11,076 | 16,282 |
Other liabilities | $42,876 | $40,175 |
DEBT_AND_CREDIT_AGREEMENTS_Det
DEBT AND CREDIT AGREEMENTS (Details) (USD $) | Sep. 30, 2013 | Apr. 17, 2013 | Dec. 31, 2012 |
Debt | |||
Current Maturities | ($75,000,000) | ||
Long-Term Debt, excluding current maturities | 1,162,000,000 | 1,012,000,000 | |
Borrowing base prior to approval | 1,700,000,000 | ||
Borrowing base | 2,300,000,000 | ||
7.33% weighted-average fixed rate notes | |||
Debt | |||
Total debt | 20,000,000 | 95,000,000 | |
Current Maturities | -75,000,000 | ||
Weighted-average interest rate (as a percent) | 7.33% | 7.33% | |
6.51% weighted-average fixed rate notes | |||
Debt | |||
Total debt | 425,000,000 | 425,000,000 | |
Weighted-average interest rate (as a percent) | 6.51% | 6.51% | |
9.78% notes | |||
Debt | |||
Total debt | 67,000,000 | 67,000,000 | |
Interest rate (as a percent) | 9.78% | 9.78% | |
5.58% weighted-average fixed rate notes | |||
Debt | |||
Total debt | 175,000,000 | 175,000,000 | |
Weighted-average interest rate (as a percent) | 5.58% | 5.58% | |
Revolving Credit Facility | |||
Debt | |||
Total debt | 475,000,000 | 325,000,000 | |
Weighted-average interest rate (as a percent) | 2.40% | ||
Availability under the credit facility | 424,000,000 | ||
Line of credit | $900,000,000 |
EARNINGS_PER_COMMON_SHARE_Deta
EARNINGS PER COMMON SHARE (Details) | 3 Months Ended | 9 Months Ended | ||
In Thousands, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 |
EARNINGS PER COMMON SHARE | ||||
Weighted-average shares - basic | 420,986 | 419,312 | 420,664 | 418,866 |
Dilution effect of stock appreciation rights and stock awards at end of period (in shares) | 2,467 | 3,140 | 2,160 | 3,128 |
Weighted-average shares - diluted | 423,453 | 422,452 | 422,824 | 421,994 |
Weighted-average shares excluded from diluted earnings per share due to the anti-dilutive effect | 1 | 92 | 3 | 204 |
COMMITMENTS_AND_CONTINGENCIES_
COMMITMENTS AND CONTINGENCIES (Details) (USD $) | 9 Months Ended |
In Millions, unless otherwise specified | Sep. 30, 2013 |
item | |
Drilling Rig Commitments | |
COMMITMENTS AND CONTINGENCIES | |
Number of drilling rig commitments | 2 |
Drilling Rig Commitments | |
2013 | $3.40 |
2014 | 14.9 |
2015 | 6.8 |
2016 | 4.4 |
Drilling Rig Commitments One | |
COMMITMENTS AND CONTINGENCIES | |
Drilling rig commitment term | 2 years |
Drilling Rig Commitments Two | |
COMMITMENTS AND CONTINGENCIES | |
Drilling rig commitment term | 3 years |
Transportation Agreements | |
COMMITMENTS AND CONTINGENCIES | |
Amount of increase in the future aggregate obligations under the transportation commitments | $49.40 |
COMMITMENTS_AND_CONTINGENCIES_1
COMMITMENTS AND CONTINGENCIES (Details 2) (Pennsylvania Department of Environmental Protection (PaDEP), USD $) | 0 Months Ended | 24 Months Ended | ||
In Millions, unless otherwise specified | Oct. 18, 2012 | Dec. 31, 2011 | Nov. 18, 2011 | Dec. 15, 2010 |
item | item | |||
Pennsylvania Department of Environmental Protection (PaDEP) | ||||
Environmental Matters | ||||
Modified Consent Order, number of households to be supplied with potable water | 14 | |||
Aggregate amount of fines and civil penalties paid to PaDEP | $1.30 | |||
Aggregate amount of settlement paid to and accepted by the appellants | $2.20 | |||
Number of appellants who were allowed by PEHB to reinstate their appeal | 3 |
DERIVATIVE_INSTRUMENTS_AND_HED2
DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES (Details) (Derivatives Designated as Hedging Instruments) | Sep. 30, 2013 |
MMcf | |
Natural Gas Collars with contract period of Oct. 2013 - Dec. 2013 Tranche 1 | |
Derivative disclosures | |
Volume | 4,500 |
Natural Gas Collars with contract period of Oct. 2013 - Dec. 2013 Tranche 1 | Minimum | |
Derivative disclosures | |
Collar Ceiling Price | 6.18 |
Natural Gas Collars with contract period of Oct. 2013 - Dec. 2013 Tranche 1 | Maximum | |
Derivative disclosures | |
Collar Ceiling Price | 6.23 |
Natural Gas Collars with contract period of Oct. 2013 - Dec. 2013 Tranche 1 | Weighted Average | |
Derivative disclosures | |
Collar Floor Price | 5.15 |
Collar Ceiling Price | 6.2 |
Natural Gas Collars with contract period of Oct. 2013 - Dec. 2013 Tranche 2 | |
Derivative disclosures | |
Volume | 54,500 |
Natural Gas Collars with contract period of Oct. 2013 - Dec. 2013 Tranche 2 | Minimum | |
Derivative disclosures | |
Collar Floor Price | 3.09 |
Collar Ceiling Price | 3.98 |
Natural Gas Collars with contract period of Oct. 2013 - Dec. 2013 Tranche 2 | Maximum | |
Derivative disclosures | |
Collar Floor Price | 4.37 |
Collar Ceiling Price | 5.02 |
Natural Gas Collars with contract period of Oct. 2013 - Dec. 2013 Tranche 2 | Weighted Average | |
Derivative disclosures | |
Collar Floor Price | 3.63 |
Collar Ceiling Price | 4.27 |
Natural Gas Collars with contract period of Oct. 2013 - Dec. 2014 Tranche 3 | |
Derivative disclosures | |
Volume | 44,400 |
Natural Gas Collars with contract period of Oct. 2013 - Dec. 2014 Tranche 3 | Minimum | |
Derivative disclosures | |
Collar Floor Price | 3.6 |
Collar Ceiling Price | 4.55 |
Natural Gas Collars with contract period of Oct. 2013 - Dec. 2014 Tranche 3 | Maximum | |
Derivative disclosures | |
Collar Floor Price | 3.96 |
Collar Ceiling Price | 4.59 |
Natural Gas Collars with contract period of Oct. 2013 - Dec. 2014 Tranche 3 | Weighted Average | |
Derivative disclosures | |
Collar Floor Price | 3.78 |
Collar Ceiling Price | 4.57 |
Natural Gas Collars with contract period of Jan. 2014 - Dec. 2014 Tranche 4 | |
Derivative disclosures | |
Volume | 124,100 |
Natural Gas Collars with contract period of Jan. 2014 - Dec. 2014 Tranche 4 | Minimum | |
Derivative disclosures | |
Collar Floor Price | 3.86 |
Collar Ceiling Price | 4.63 |
Natural Gas Collars with contract period of Jan. 2014 - Dec. 2014 Tranche 4 | Maximum | |
Derivative disclosures | |
Collar Floor Price | 4.37 |
Collar Ceiling Price | 4.8 |
Natural Gas Collars with contract period of Jan. 2014 - Dec. 2014 Tranche 4 | Weighted Average | |
Derivative disclosures | |
Collar Floor Price | 4.19 |
Collar Ceiling Price | 4.7 |
Crude Oil Swaps with contract period of Oct. 2013 - Dec. 2013 Tranche 1 | |
Derivative disclosures | |
Volume | 276 |
Swaps Weighted Average | 101.9 |
DERIVATIVE_INSTRUMENTS_AND_HED3
DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES (Details 2) (USD $) | 9 Months Ended | |
Sep. 30, 2013 | Dec. 31, 2012 | |
Effect of derivative instruments on the Condensed Consolidated Balance Sheet | ||
Fair Value Asset | $65,539,000 | $50,824,000 |
Fair Value Liability | 192,000 | |
Unrealized gains included in Accumulated Other Comprehensive Income, net of tax | 39,800,000 | 30,700,000 |
Expected reclassification of income from commodity hedges over the next 12 months | 34,500,000 | |
Accumulated Net Gains / (Losses) on Cash Flow Hedges | ||
Effect of derivative instruments on the Condensed Consolidated Balance Sheet | ||
Unrealized gains included in Accumulated Other Comprehensive Income, pretax | 65,500,000 | 50,600,000 |
Derivatives Designated as Hedging Instruments | ||
Effect of derivative instruments on the Condensed Consolidated Balance Sheet | ||
Fair Value Asset | 65,539,000 | 50,824,000 |
Fair Value Liability | 192,000 | |
Derivatives Designated as Hedging Instruments | Commodity contracts | Current Assets | ||
Effect of derivative instruments on the Condensed Consolidated Balance Sheet | ||
Fair Value Asset | 56,831,000 | 50,824,000 |
Derivatives Designated as Hedging Instruments | Commodity contracts | non-current assets | ||
Effect of derivative instruments on the Condensed Consolidated Balance Sheet | ||
Fair Value Asset | 8,708,000 | |
Derivatives Designated as Hedging Instruments | Commodity contracts | Accrued liabilities | ||
Effect of derivative instruments on the Condensed Consolidated Balance Sheet | ||
Fair Value Liability | $192,000 |
DERIVATIVE_INSTRUMENTS_AND_HED4
DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES (Details 3) (USD $) | Sep. 30, 2013 | Dec. 31, 2012 |
In Thousands, unless otherwise specified | ||
Derivative Assets | ||
Gross amounts of recognized assets | $66,473 | $54,454 |
Gross amounts offset in the statement of financial position | -934 | -3,630 |
Net amounts of assets presented in the statement of financial position | 65,539 | 50,824 |
Gross amounts financial instrument not offset in the statement of financial position | 1,892 | |
Net amount | 65,539 | 52,716 |
Derivative Liabilities | ||
Gross amounts of recognized liabilities | 934 | 3,822 |
Gross amounts offset in the statement of financial position | -934 | -3,630 |
Net amounts of liabilities presented in the statement of financial position | 192 | |
Gross amounts of financial instruments not offset in the statement of financial position | 390 | |
Net amount | $390 | $192 |
DERIVATIVE_INSTRUMENTS_AND_HED5
DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES (Details 4) (USD $) | 3 Months Ended | 9 Months Ended | ||
In Thousands, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 |
Effect of derivative instruments on the Condensed Consolidated Statement of Operations | ||||
Ineffectiveness related to derivative instruments | $0 | $0 | $0 | $0 |
Natural Gas Revenues | ||||
Effect of derivative instruments on the Condensed Consolidated Statement of Operations | ||||
Amount of Gain (Loss) Recognized in Income on Derivatives Not Designated | 0 | -149 | 0 | -449 |
Derivatives Designated as Hedging Instruments | ||||
Effect of derivative instruments on the Condensed Consolidated Statement of Operations | ||||
Amount of Gain (Loss) Reclassified from Accumulated OCI into Income (Effective Portion) | 19,684 | 60,938 | 36,876 | 189,450 |
Derivatives Designated as Hedging Instruments | Natural Gas Revenues | ||||
Effect of derivative instruments on the Condensed Consolidated Statement of Operations | ||||
Amount of Gain (Loss) Reclassified from Accumulated OCI into Income (Effective Portion) | 20,766 | 57,139 | 33,822 | 183,867 |
Derivatives Designated as Hedging Instruments | Crude Oil and Condensate Revenues | ||||
Effect of derivative instruments on the Condensed Consolidated Statement of Operations | ||||
Amount of Gain (Loss) Reclassified from Accumulated OCI into Income (Effective Portion) | -1,082 | 3,799 | 3,054 | 5,583 |
Derivatives Designated as Hedging Instruments | Commodity contracts | ||||
Effect of derivative instruments on the Condensed Consolidated Statement of Operations | ||||
Amount of Gain (Loss) Recognized In OCI on Derivatives (Effective Portion) | ($2,384) | ($39,805) | $51,783 | $49,299 |
FAIR_VALUE_MEASUREMENTS_Detail
FAIR VALUE MEASUREMENTS (Details) (USD $) | 9 Months Ended | ||
In Thousands, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 | Dec. 31, 2012 |
item | item | ||
Financial Assets and Liabilities Fair Value Measurement | |||
Number of non-financial assets and liabilities impaired | 0 | 0 | |
Assets | |||
Deferred compensation plan | $11,865 | $10,608 | |
Derivative instruments | 65,539 | 50,824 | |
Total assets | 77,404 | 61,432 | |
Liabilities | |||
Deferred compensation plan | 31,800 | 23,893 | |
Derivative instruments | 192 | ||
Total liabilities | 31,800 | 24,085 | |
Transfer of Assets from Level 1 to Level 2 | 0 | 0 | |
Transfer of Liabilities from Level 1 to Level 2 | 0 | 0 | |
Transfer of Assets from Level 2 to Level 1 | 0 | 0 | |
Transfer of Liabilities from Level 2 to Level 1 | 0 | 0 | |
Quoted Prices in Active Markets for Identical Assets (Level 1) | |||
Assets | |||
Deferred compensation plan | 11,865 | 10,608 | |
Total assets | 11,865 | 10,608 | |
Liabilities | |||
Deferred compensation plan | 31,800 | 23,893 | |
Total liabilities | 31,800 | 23,893 | |
Significant Other Observable Inputs (Level 2) | |||
Assets | |||
Derivative instruments | 93 | 9,473 | |
Total assets | 93 | 9,473 | |
Significant Unobservable Inputs (Level 3) | |||
Assets | |||
Derivative instruments | 65,446 | 41,351 | |
Total assets | 65,446 | 41,351 | |
Liabilities | |||
Derivative instruments | 192 | ||
Total liabilities | $192 |
FAIR_VALUE_MEASUREMENTS_Detail1
FAIR VALUE MEASUREMENTS (Details 2) (USD $) | 3 Months Ended | 9 Months Ended | ||
In Thousands, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 |
Reconciliation of changes in the fair value of financial assets and liabilities classified as Level 3 in the fair value hierarchy | ||||
Balance at beginning of period | $83,878 | $129,213 | $41,159 | $195,127 |
Total gains / (losses) (realized or unrealized): | ||||
Included in earnings | 20,766 | 56,990 | 33,822 | 183,418 |
Included in other comprehensive income | -18,432 | -85,466 | 24,287 | -153,008 |
Settlements | -20,766 | -55,915 | -33,822 | -181,100 |
Transfers in and/or out of level 3 | 385 | |||
Balance at end of period | 65,446 | 44,822 | 65,446 | 44,822 |
Derivative disclosures | ||||
Transfers between Level 1 and Level 2 measurements | 0 | 0 | 0 | 0 |
Natural Gas Revenues | ||||
Derivative disclosures | ||||
Unrealized gain (loss) included in natural gas revenues | $0 | ($149) | $0 | ($449) |
FAIR_VALUE_MEASUREMENTS_Detail2
FAIR VALUE MEASUREMENTS (Details 3) (USD $) | Sep. 30, 2013 | Dec. 31, 2012 |
In Thousands, unless otherwise specified | ||
Fair value disclosures | ||
Current maturities | ($75,000) | |
Long-Term Debt, excluding current maturities | 1,162,000 | 1,012,000 |
Carrying Amount | ||
Fair value disclosures | ||
Long-Term Debt | 1,162,000 | 1,087,000 |
Current maturities | -75,000 | |
Long-Term Debt, excluding current maturities | 1,162,000 | 1,012,000 |
Estimated Fair Value | ||
Fair value disclosures | ||
Long-Term Debt | 1,258,627 | 1,213,474 |
Current maturities | -77,175 | |
Long-Term Debt, excluding current maturities | $1,258,627 | $1,136,299 |
ACCUMULATED_OTHER_COMPREHENSIV2
ACCUMULATED OTHER COMPREHENSIVE INCOME / (LOSS) (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 |
Changes in accumulated other comprehensive income / (loss) by component, net of tax | ||||
Balance at beginning of period | $23,880 | |||
Other comprehensive income before reclassifications | 31,417 | |||
Amounts reclassifies from accumulated other comprehensive income | -22,053 | |||
Total other comprehensive income / (loss) | -13,319 | -61,576 | 9,364 | -77,289 |
Balance at end of period | 33,244 | 33,244 | ||
Accumulated Net Gains / (Losses) on Cash Flow Hedges | ||||
Changes in accumulated other comprehensive income / (loss) by component, net of tax | ||||
Balance at beginning of period | 30,717 | |||
Other comprehensive income before reclassifications | 31,417 | |||
Amounts reclassifies from accumulated other comprehensive income | -22,372 | |||
Total other comprehensive income / (loss) | 9,045 | |||
Balance at end of period | 39,762 | 39,762 | ||
Accumulated Postretirement Benefits | ||||
Changes in accumulated other comprehensive income / (loss) by component, net of tax | ||||
Balance at beginning of period | -6,837 | |||
Amounts reclassifies from accumulated other comprehensive income | 319 | |||
Total other comprehensive income / (loss) | 319 | |||
Balance at end of period | ($6,518) | ($6,518) |
ACCUMULATED_OTHER_COMPREHENSIV3
ACCUMULATED OTHER COMPREHENSIVE INCOME / (LOSS) (Details 2) (USD $) | 3 Months Ended | 9 Months Ended | ||||||
In Thousands, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | ||||
Line items in income statement impacted by reclassifications out of accumulated other comprehensive income | ||||||||
Natural gas revenues | $341,901 | $231,896 | $1,004,085 | $639,729 | ||||
Crude oil and condensate revenues | 84,209 | 57,870 | 220,090 | 165,317 | ||||
Amortization of net loss | 70 | [1] | 79 | [1] | 319 | [1] | 8,428 | [1] |
Income before income taxes | 115,736 | 59,556 | 334,530 | 148,885 | ||||
Tax (expense) / benefit | -45,847 | -22,948 | -132,703 | -58,021 | ||||
NET INCOME | 69,889 | 36,608 | 201,827 | 90,864 | ||||
Amount Reclassified from Accumulated Other Comprehensive Income | ||||||||
Line items in income statement impacted by reclassifications out of accumulated other comprehensive income | ||||||||
Income before income taxes | 19,568 | 36,351 | ||||||
Tax (expense) / benefit | -7,696 | -14,298 | ||||||
NET INCOME | 11,872 | 22,053 | ||||||
Accumulated Net Gains / (Losses) on Cash Flow Hedges | Amount Reclassified from Accumulated Other Comprehensive Income | Commodity contracts | ||||||||
Line items in income statement impacted by reclassifications out of accumulated other comprehensive income | ||||||||
Natural gas revenues | 20,766 | 33,822 | ||||||
Crude oil and condensate revenues | -1,082 | 3,054 | ||||||
Accumulated Defined Benefit Pension and Postretirement Plans | Amount Reclassified from Accumulated Other Comprehensive Income | ||||||||
Line items in income statement impacted by reclassifications out of accumulated other comprehensive income | ||||||||
Amortization of net loss | ($116) | ($525) | ||||||
[1] | Net of income taxes of $(46) and $(53) for the three months ended September 30, 2013 and 2012, respectively, and $(206) and $(5,347) for the nine months ended September 30, 2013 and 2012, respectively. |
PENSION_AND_POSTRETIREMENT_BEN2
PENSION AND POSTRETIREMENT BENEFITS (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 |
Qualified Pension Plan | ||||
Components of Net Periodic Benefit Cost | ||||
Interest Cost | $922 | |||
Expected return on plan assets | -1,748 | |||
Settlement | 7,111 | |||
Amortization of prior service cost | 221 | |||
Amortization of net loss | 13,083 | |||
Net periodic pension cost | 19,589 | |||
Postretirement Benefit | ||||
Components of Net Periodic Benefit Cost | ||||
Service Cost | 455 | 234 | 1,285 | 1,280 |
Interest Cost | 355 | 351 | 1,145 | 1,187 |
Amortization of net loss | 116 | 132 | 525 | 692 |
Net periodic pension cost | $926 | $717 | $2,955 | $3,159 |
STOCKBASED_COMPENSATION_Detail
STOCK-BASED COMPENSATION (Details) (USD $) | 3 Months Ended | 9 Months Ended | 0 Months Ended | 9 Months Ended | ||||||||||
In Millions, except Share data, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Feb. 21, 2013 | Sep. 30, 2013 |
Restricted Stock Awards | Restricted Stock Units | Performance Share Awards | Performance Share Awards | Performance Share Awards | Performance shares based on performance conditions | Performance Share Awards Based on Internal Performance Metrics -3 Year Graded Vesting | Performance Share Awards Based on Internal Metrics-Three Performance Metrics | Performance shares based on market conditions | Performance shares based on market conditions | |||||
item | Greater than | Less than or equal to | item | item | ||||||||||
Stock-Based Compensation arrangements | ||||||||||||||
Stock based compensation expense | $12.20 | $10.40 | $41 | $23.40 | ||||||||||
Granted (in shares) | 5,700 | 804,500 | 549,520 | 169,980 | 379,540 | 254,980 | ||||||||
Granted and fully vested (in shares) | 49,042 | |||||||||||||
Granted (in dollars per share) | $35.56 | $27.19 | $26.62 | $23.06 | ||||||||||
Annual forfeiture rate assumption (as a percent) | 6.00% | 0.00% | 6.00% | |||||||||||
Number of types of performance awards granted to employees | 3 | |||||||||||||
Right to receive shares as percentage of award | 100.00% | |||||||||||||
Number of years over which performance criteria is to be met | 3 years | |||||||||||||
Minimum operating cash flow for the year preceding the performance period | $100 | |||||||||||||
Number of criteria considered for awarding performance shares | 3 | |||||||||||||
Vesting rights | 25% of the shares vest on each the first and second anniversary dates following the date of grant and 50% of the shares vest on the third anniversary following the date of the grant | An employee will earn one-third of the award granted for each internal performance metric that the Company meets at the end of the performance period. | ||||||||||||
Number of other companies in the Company's peer group | 15 | |||||||||||||
Assumptions: | ||||||||||||||
Value per Share, low end of range (in dollars per share) | $22.17 | |||||||||||||
Value per Share, high end of range (in dollars per share) | $36.98 | |||||||||||||
Stock price volatility (as a percent) | 43.80% | |||||||||||||
Risk free rate of return (as a percent) | 0.40% | |||||||||||||
Expected dividend yield (as a percent) | 0.20% | 0.10% | ||||||||||||
Stock Price Volatility, low end of range (as a percent) | 26.20% | |||||||||||||
Stock Price Volatility, high end of range (as a percent) | 42.80% | |||||||||||||
Risk free rate of return, low end of range (as a percent) | 0.00% | |||||||||||||
Risk free rate of return, high end of range (as a percent) | 0.40% |
STOCKBASED_COMPENSATION_Detail1
STOCK-BASED COMPENSATION (Details 2) (USD $) | 3 Months Ended | 9 Months Ended | 3 Months Ended | 9 Months Ended | 0 Months Ended | |||||||||
In Millions, except Per Share data, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | Feb. 11, 2013 | Feb. 11, 2013 | Aug. 27, 2013 | Sep. 19, 2013 | Sep. 30, 2013 | Sep. 30, 2013 |
SEIP III | SEIP III | SEIP III | SEIP III | SEIP III | SEIP III | SEIP III | SEIP IV | SEIP IV | SEIP IV | |||||
Interim trigger date occurs by June 30, 2014 | Interim trigger date occurs by June 30, 2014 | Final trigger date occurs by June 30, 2016 | Interim trigger date occurs by September 30, 2015 | Final trigger date occurs by September 30, 2017 | ||||||||||
February 2013 Trigger Achievement | ||||||||||||||
Stock-Based Compensation arrangements | ||||||||||||||
Stock based compensation expense | $12.20 | $10.40 | $41 | $23.40 | $4.10 | $1.60 | $9.20 | ($0.10) | ||||||
Interim goal price (in dollars per share) | $25 | $55 | ||||||||||||
Distribution to be made to company's employees due to achievement of interim goal price of $25 per share | 6.8 | |||||||||||||
Percentage of total interim distribution paid in February | 25.00% | |||||||||||||
Current distribution to be made to company's employees due to achievement of interim goal price of $25 per share | 1.7 | |||||||||||||
Percentage of total interim distribution deferred | 75.00% | |||||||||||||
Deferred distribution to be made to company's employees due to achievement of interim goal price of $25 per share | 5.1 | |||||||||||||
Final goal price (in dollars per share) | $37.50 | $80 | ||||||||||||
Distribution to be made to the company's employees due to achievement of interim goal price of $25 per share | 11.1 | |||||||||||||
Percentage of the total distribution paid in September 2013 | 25.00% | |||||||||||||
Current distribution to be made to the company's employees due to achievement of final goal price of $37.50 per share | 2.8 | |||||||||||||
Percentage of the total distribution to be paid in August 2014 | 75.00% | |||||||||||||
Deferred distribution to be made to the company's employees due to achievement of final goal price of $37.50 per share | $8.30 | |||||||||||||
Number of trading days during which the closing price per share of the company's common stock equals or exceeds the goal price | 20 days | |||||||||||||
Number of consecutive trading days | 60 days |
ASSET_RETIREMENT_OBLIGATION_De
ASSET RETIREMENT OBLIGATION (Details) (USD $) | 9 Months Ended |
Sep. 30, 2013 | |
Asset Retirement Obligation | |
Balance at the beginning of the period | $67,016,000 |
Liabilities incurred | 3,945,000 |
Liabilities settled | -800,000 |
Liabilities divested | -341,000 |
Accretion expense | 2,705,000 |
Balance at the end of the period | 72,525,000 |
Additional disclosures | |
Asset retirement obligation, current | $2,000,000 |