Document_and_Entity_Informatio
Document and Entity Information Document | 9 Months Ended | |
Sep. 30, 2013 | Oct. 23, 2013 | |
Entity Information [Line Items] | ||
Entity Registrant Name | SM Energy Co | |
Entity Central Index Key | 893538 | |
Current Fiscal Year End Date | -19 | |
Entity Filer Category | Large Accelerated Filer | |
Document Type | 10-Q | |
Document Period End Date | 30-Sep-13 | |
Document Fiscal Year Focus | 2013 | |
Document Fiscal Period Focus | Q3 | |
Amendment Flag | FALSE | |
Entity Common Stock, Shares Outstanding | 66,988,132 | |
Entity Current Reporting Status | Yes |
CONDENSED_CONSOLIDATED_BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS (UNAUDITED) (in thousands, except share amounts) (USD $) | Sep. 30, 2013 | Dec. 31, 2012 |
In Thousands, unless otherwise specified | ||
Assets | ||
Cash and cash equivalents at beginning of period | $176 | $5,926 |
Accounts receivable | 278,125 | 254,805 |
Refundable income taxes | 2,854 | 3,364 |
Prepaid expense and other | 10,498 | 30,017 |
Derivative asset | 43,305 | 37,873 |
Deferred income taxes | 10,912 | 8,579 |
Total current assets | 345,870 | 340,564 |
Land | 1,857 | 1,845 |
Proved oil and gas properties | 5,414,842 | 5,401,684 |
Less - accumulated depletion, depreciation, and amortization | -2,418,939 | -2,376,170 |
Unproved oil and gas properties | 263,662 | 175,287 |
Wells in progress | 301,609 | 273,928 |
Materials inventory, at lower of cost or market | 14,115 | 13,444 |
Oil and gas properties held for sale net of accumulated depletion, depreciation and amortization of $539,769 in 2013 and 20,676 in 2012 | 400,393 | 33,620 |
Other property and equipment, net of accumulated depreciation of $27,571 in 2013 and $22,442 in 2012 | 203,799 | 153,559 |
Total property and equipment, net | 4,181,338 | 3,677,197 |
Derivative asset | 28,659 | 16,466 |
Restricted cash | 94,700 | 86,773 |
Other noncurrent assets | 86,278 | 78,529 |
Total other noncurrent assets | 209,637 | 181,768 |
Total Assets | 4,736,845 | 4,199,529 |
Liabilities | ||
Accounts payable and accrued expenses | 601,131 | 525,627 |
Derivative liability | 22,648 | 8,999 |
Other current liabilities | 6,000 | 6,920 |
Total current liabilities | 629,779 | 541,546 |
Revolving credit facility | 28,000 | 340,000 |
6.625% Senior Notes Due 2019 | 350,000 | 350,000 |
6.50% Senior Notes Due 2021 | 350,000 | 350,000 |
6.50% Senior Notes Due 2023 | 400,000 | 400,000 |
5.0% Senior Notes Due 2024 | 500,000 | 0 |
Asset retirement obligation | 101,650 | 112,912 |
Asset retirement obligation associated with oil and gas properties held for sale | 25,339 | 1,393 |
Net Profits Plan liability | 72,404 | 78,827 |
Deferred income taxes | 639,000 | 537,383 |
Derivatives liability | 6,873 | 6,645 |
Other noncurrent liabilities | 47,016 | 66,357 |
Total noncurrent liabilities | 2,520,282 | 2,243,517 |
Commitments and contingencies (note 6) | ||
Stockholders' equity: | ||
Common stock, $0.01 par value - authorized: 200,000,000 shares; issued: 66,994,516 shares in 2013 and 66,245,816 shares in 2012; outstanding, net of treasury shares: 66,972,104 shares in 2013 and 66,195,235 shares in 2012 | 670 | 662 |
Additional paid-in-capital | 247,165 | 233,642 |
Treasury stock, at cost: 22,412 shares in 2013 and 50,581 in 2012 | -823 | -1,221 |
Retained earnings | 1,347,674 | 1,190,397 |
Accumulated other comprehensive loss | -7,902 | -9,014 |
Total stockholders' equity | 1,586,784 | 1,414,466 |
Total Liabilities and Stockholders' Equity | $4,736,845 | $4,199,529 |
Balance_Sheet_Parenthetical_Pa
Balance Sheet Parenthetical (Parentheticals) (USD $) | Sep. 30, 2013 | Dec. 31, 2012 |
Oil and Gas Property, Successful Effort Method, Accumulated Depreciation, Depletion and Amortization | 2,418,939,000 | 2,376,170,000 |
Common Stock, Par or Stated Value Per Share | 0.01 | 0.01 |
Common Stock, Shares Authorized | 200,000,000 | 200,000,000 |
Common Stock, Shares, Issued | 66,994,516 | 66,245,816 |
Common Stock, Shares, Outstanding | 66,972,104 | 66,195,235 |
Treasury Stock, Shares | 22,412 | 50,581 |
Assets Held-for-sale [Member] | ||
Oil and Gas Property, Successful Effort Method, Accumulated Depreciation, Depletion and Amortization | 539,769,000 | 20,676,000 |
Other Capitalized Property Plant and Equipment [Member] | ||
Oil and Gas Property, Successful Effort Method, Accumulated Depreciation, Depletion and Amortization | 27,571,000 | 22,442,000 |
6.625% Senior Notes Due 2019 [Member] | ||
Interest rate on notes (as a percent) | 6.63% | 6.63% |
6.50% Senior Notes Due 2021 [Member] | ||
Interest rate on notes (as a percent) | 6.50% | 6.50% |
6.50% Senior Notes Due 2023 [Member] | ||
Interest rate on notes (as a percent) | 6.50% | 6.50% |
5.0% Senior Notes Due 2024 [Member] | ||
Interest rate on notes (as a percent) | 5.00% | 5.00% |
CONDENSED_CONSOLIDATED_STATEME
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED) (in thousands, except per share amounts) (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: | ||||
Oil, gas, and NGL production revenue | $601,787 | $373,928 | $1,605,882 | $1,049,131 |
Realized hedge gain (loss) | -489 | 501 | -1,777 | 2,338 |
Loss on divestiture activity | -6,216 | -8,532 | -510 | -31,246 |
Other operating revenues | 18,025 | 13,054 | 53,052 | 40,571 |
Total operating revenues | 613,107 | 378,951 | 1,656,647 | 1,060,794 |
Operating expenses: | ||||
Oil, gas, and NGL production expense | 158,921 | 102,447 | 434,291 | 280,713 |
Depletion, depreciation, amortization, and asset retirement obligation liability accretion | 195,792 | 192,432 | 620,232 | 523,610 |
Exploration | 16,280 | 25,417 | 52,335 | 66,031 |
Impairment of proved properties | 5,935 | 0 | 61,706 | 38,523 |
Abandonment and impairment of unproved properties | 3,818 | 447 | 8,459 | 11,296 |
General and administrative | 33,920 | 32,171 | 101,574 | 91,443 |
Change in Net Profits Plan liability | 940 | 798 | -6,423 | -17,342 |
Derivative (gain) loss | 39,933 | 55,856 | -14,685 | -40,040 |
Other operating expenses | 20,084 | 12,219 | 71,192 | 40,780 |
Total operating expenses | 475,623 | 421,787 | 1,328,681 | 995,014 |
Income (loss) from operations | 137,484 | -42,836 | 327,966 | 65,780 |
Non-operating income (expense) | ||||
Interest income | 28 | 126 | 64 | 201 |
Interest expense | -24,488 | -18,362 | -65,170 | -45,352 |
Income (loss) before income taxes | 113,024 | -61,072 | 262,860 | 20,629 |
Income tax (expense) benefit | -42,334 | 22,736 | -98,921 | -7,740 |
Net income (loss) | $70,690 | ($38,336) | $163,939 | $12,889 |
Basic weighted-average common shares outstanding | 66,943 | 65,745 | 66,486 | 64,815 |
Diluted weighted-average common shares outstanding | 68,253 | 65,745 | 67,969 | 67,343 |
Basic net income (loss) per common share | $1.06 | ($0.58) | $2.47 | $0.20 |
Diluted net income (loss) per common share | $1.04 | ($0.58) | $2.41 | $0.19 |
Dividends per common share | $0.05 | $0.05 | $0.10 | $0.10 |
CONDENSED_CONSOLIDATED_STATEME1
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) (USD $) | 3 Months Ended | 9 Months Ended | ||||||
In Thousands, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | ||||
Statement of Other Comprehensive Income [Abstract] | ||||||||
Net income (loss) | $70,690 | ($38,336) | $163,939 | $12,889 | ||||
Reclassification to earnings | 308 | [1] | -315 | [1] | 1,115 | [1] | -1,465 | [1] |
Pension liability adjustment | 0 | 1 | -3 | 1 | ||||
Total other comprehensive income (loss), net of tax | 308 | -314 | 1,112 | -1,464 | ||||
Total comprehensive income (loss) | $70,998 | ($38,650) | $165,051 | $11,425 | ||||
[1] | Reclassification from accumulated other comprehensive income related to de-designated hedges. Refer to Note 10 - Derivative Financial Instruments for further information. |
CONDENSED_CONSOLIDATED_STATEME2
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (USD $) | 9 Months Ended | |||
Sep. 30, 2013 | Sep. 30, 2012 | |||
Statement of Cash Flows [Abstract] | ||||
Net income (loss) | $163,939,000 | $12,889,000 | ||
Adjustments to reconcile net income to net cash provided by operating activities: | ||||
Loss on divestiture activity | -510,000 | -31,246,000 | ||
Depletion, depreciation, amortization, and asset retirement obligation liability accretion | 620,232,000 | 523,610,000 | ||
Exploratory dry hole expense | 5,878,000 | 18,551,000 | ||
Impairment of proved properties | 61,706,000 | 38,523,000 | ||
Abandonment and impairment of unproved properties | 8,459,000 | 11,296,000 | ||
Stock-based compensation expense | 25,495,000 | 21,731,000 | ||
Change in Net Profits Plan liability | -6,423,000 | -17,342,000 | ||
Derivative (gain) loss | -14,685,000 | [1] | -40,040,000 | [1] |
Derivative cash settlement gain | 12,715,000 | [2] | 32,803,000 | [2] |
Amortization of debt discount and deferred financing costs | 3,914,000 | 5,692,000 | ||
Deferred income taxes | 98,619,000 | 7,305,000 | ||
Plugging and abandonment | -7,453,000 | -1,804,000 | ||
Other | 2,929,000 | 906,000 | ||
Changes in current assets and liabilities: | ||||
Accounts receivable | -45,209,000 | -18,682,000 | ||
Refundable income taxes | 510,000 | 2,339,000 | ||
Prepaid expenses and other | -2,971,000 | -6,203,000 | ||
Accounts payable and accrued expenses | 72,704,000 | 30,766,000 | ||
Net Cash Provided by Operating Activities | 1,000,869,000 | 653,586,000 | ||
Cash flows from investing activities: | ||||
Net proceeds from sale of oil and gas properties | 20,498,000 | 48,663,000 | ||
Capital expenditures | -1,121,355,000 | -1,126,755,000 | ||
Acquisition of proved and unproved oil and gas properties | -62,007,000 | -5,604,000 | ||
Other | -3,509,000 | 0 | ||
Net cash used in investing activities | -1,166,373,000 | -1,083,696,000 | ||
Cash flows from financing activities: | ||||
Proceeds from credit facility | 976,500,000 | 1,234,500,000 | ||
Repayment of credit facility | -1,288,500,000 | -1,006,500,000 | ||
Deferred financing costs related to credit facility | -3,444,000 | 0 | ||
Net proceeds from 5.0% Senior Notes Due 2024 | 490,274,000 | 0 | ||
Net proceeds from 6.50% Senior Notes Due 2023 | 0 | 392,223,000 | ||
Repayment of 3.50% Convertible Notes | 0 | -287,500,000 | ||
Proceeds from sale of common stock | 4,450,000 | 3,421,000 | ||
Dividends paid | -3,314,000 | -3,208,000 | ||
Net share settlement from issuance of stock awards | -16,203,000 | -21,605,000 | ||
Other | -9,000 | -231,000 | ||
Net cash provided by financing activities | 159,754,000 | 311,100,000 | ||
Net change in cash and cash equivalents | -5,750,000 | -119,010,000 | ||
Cash and cash equivalents at beginning of period | 5,926,000 | 119,194,000 | ||
Cash and cash equivalents at ending of period | 176,000 | 184,000 | ||
Supplemental schedule of additional cash flow information and noncash investing and financing activities: | ||||
Cash paid for interest, net of capitalized interest | -59,841,000 | -41,413,000 | ||
Net cash refunded for income taxes | 259,000 | 1,583,000 | ||
Capital expenditures incurred but not yet paid | 238,700,000 | 213,600,000 | ||
Dividends, Common Stock | $3,300,000 | $3,300,000 | ||
[1] | (2)B Total derivative (gain) loss is reported in the derivative gain line item on the condensed consolidated statements of cash flows within net cash provided by operating activities. | |||
[2] | (1)B Derivative cash settlement (gain) loss is reported in the derivative cash settlement gain line item on the condensed consolidated statements of cash flows within net cash provided by operating activities. |
The_Company_and_Business
The Company and Business | 9 Months Ended |
Sep. 30, 2013 | |
Company and Business Disclosure [Abstract] | |
The Company and Business | Note 1 - The Company and Business |
SM Energy Company (“SM Energy” or the “Company”) is an independent energy company engaged in the acquisition, exploration, development, and production of crude oil and condensate, natural gas, and natural gas liquids (also respectively referred to as “oil,” “gas,” and “NGLs” throughout this report) in onshore North America, with a current focus on oil and liquids-rich resource plays. |
Basis_of_Presentation_Signific
Basis of Presentation, Significant Accounting Policies, and Recently Issued Accounting Standards | 9 Months Ended |
Sep. 30, 2013 | |
Accounting Policies [Abstract] | |
Basis of Presentation, Significant Accounting Policies, and Recently Issued Accounting Standards | Note 2 - Basis of Presentation, Significant Accounting Policies, and Recently Issued Accounting Standards |
Basis of Presentation | |
The accompanying unaudited condensed consolidated financial statements of SM Energy have been prepared in accordance with accounting principles generally accepted in the United States (“GAAP”) for interim financial information and the instructions to Form 10-Q and Regulation S-X. They do not include all information and notes required by GAAP for complete financial statements. However, except as disclosed herein, there has been no material change in the information disclosed in the notes to consolidated financial statements included in SM Energy’s Annual Report on Form 10-K for the year ended December 31, 2012 (the “2012 Form 10-K”). In the opinion of management, all adjustments, consisting of normal recurring accruals considered necessary for a fair presentation of interim financial information, have been included. Operating results for the periods presented are not necessarily indicative of expected results for the full year. In connection with the preparation of its unaudited condensed consolidated financial statements, the Company evaluated events subsequent to the balance sheet date of September 30, 2013, through the filing date of this report. Certain prior period amounts have been reclassified to conform to the current period presentation. | |
Significant Accounting Policies | |
The significant accounting policies followed by the Company are set forth in Note 1 to the Company’s consolidated financial statements in the 2012 Form 10-K, and are supplemented by the notes to the unaudited condensed consolidated financial statements in this report. These unaudited condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and notes included in the 2012 Form 10-K. | |
Recently Issued Accounting Standards | |
On January 1, 2013, the Company adopted new authoritative accounting guidance issued by the Financial Accounting Standards Board (“FASB”), which enhanced disclosures by requiring an entity to disclose information about netting arrangements, including rights of offset, to enable users of its financial statements to understand the effect of those arrangements on its financial position and provided clarification as to the specific instruments that should be considered in these disclosures. These pronouncements were issued to facilitate comparison between financial statements prepared on the basis of GAAP and International Financial Reporting Standards. These disclosures are effective for annual and interim reporting periods beginning on or after January 1, 2013, and are to be applied retrospectively for all comparative periods presented. The impact of retrospectively adopting these pronouncements did not have a material impact on the Company’s consolidated financial statements, but did impact the Company’s disclosures. See Note 10 - Derivative Financial Instruments for tabular presentation of the Company’s gross and net derivative positions. | |
On March 31, 2013, the Company adopted the presentation requirements of new authoritative accounting guidance issued by the FASB in February 2013. The purpose of the guidance was to improve the reporting of reclassifications out of accumulated other comprehensive income (loss) (“AOCIL”) by requiring entities to report the effect of significant reclassifications out of AOCIL into current year income within the respective line items in net income. The presentation of those amounts may be on the face of the financial statements or in the notes thereto. This amendment was effective prospectively for periods beginning after December 15, 2012. | |
In February 2013, the FASB issued new authoritative accounting guidance related to the recognition and measurement of obligations arising from joint and several liability arrangements. This authoritative accounting guidance is effective for interim and annual periods beginning after December 15, 2013. The Company is currently evaluating the provisions of this guidance and assessing its impact on the Company’s financial statements and disclosures. | |
In July 2013, the FASB issued new authoritative accounting guidance related to the reporting of unrecognized tax benefits when a net operating loss carryforward, similar tax loss, or tax credit carryforward exists. This authoritative accounting guidance is effective for interim and annual periods beginning after December 15, 2013. The Company is currently evaluating the provisions of this guidance and assessing its impact on the Company’s financial statements and disclosures, but does not believe its financial statements will be significantly impacted. | |
There are no additional new significant accounting standards applicable to the Company that had been issued but not yet adopted by the Company as of September 30, 2013. |
Assets_Held_for_Sale_Assets_He
Assets Held for Sale Assets Held for Sale | 9 Months Ended |
Sep. 30, 2013 | |
Assets held for sale [Abstract] | |
Divestitures and Assets Held-for-sale | Note 3 – Assets Held for Sale |
Assets are classified as held for sale when the Company commits to a plan to sell the assets and there is reasonable certainty the sale will take place within one year. Upon classification as held for sale, long-lived assets are no longer depreciated or depleted, and a measurement for impairment is performed to identify and expense any excess of carrying value over fair value less estimated costs to sell. Subsequent changes to the estimated fair value less the costs to sell will impact the measurement of assets held for sale for which fair value less estimated costs to sell is determined to be less than the carrying value of the assets. | |
As of September 30, 2013, the accompanying condensed consolidated balance sheets (“accompanying balance sheets”) present $400.4 million of assets held for sale, net of accumulated depletion, depreciation, and amortization expense. A corresponding asset retirement obligation liability of $25.3 million is separately presented. The assets held for sale include certain assets located in all four of the Company’s regions, all of which are recorded at the lesser of their carrying values or their respective fair value less estimated costs to sell. Write-downs to fair value less estimated costs to sell of $8.7 million for the three months ended September 30, 2013, and $10.1 million for the nine months ended September 30, 2013, are reflected in the loss on divestiture activity line item in the accompanying condensed consolidated statements of operations (“accompanying statements of operations”). | |
The Company entered into multiple agreements to divest certain assets located in its Mid-Continent and Rocky Mountain regions that were classified as held for sale at September 30, 2013. The closings of these transactions are subject to the satisfaction of certain closing conditions, including the resolution of any title and environmental defects exceeding specified levels. Sales prices less estimated costs to sell were in excess of the carrying values of these assets as of September 30, 2013. | |
The Company determined that these planned asset sales do not qualify for discontinued operations accounting under financial statement presentation authoritative guidance. |
Earnings_per_Share
Earnings per Share | 9 Months Ended | |||||||||||||||
Sep. 30, 2013 | ||||||||||||||||
Earnings Per Share [Abstract] | ||||||||||||||||
Earnings per Share | Note 9 - Earnings per Share | |||||||||||||||
Basic net income per common share is calculated by dividing net income available to common stockholders by the basic weighted-average common shares outstanding for the respective period. The Company’s earnings per share calculations reflect the impact of any repurchases of shares of common stock made by the Company. | ||||||||||||||||
Diluted net income per common share is calculated by dividing adjusted net income by the diluted weighted-average common shares outstanding, which includes the effect of potentially dilutive securities. Potentially dilutive securities for this calculation consist of in-the-money outstanding stock options, unvested RSUs, and contingent PSUs. The treasury stock method is used to measure the dilutive impact of unvested RSUs, contingent PSUs, and in-the-money stock options. | ||||||||||||||||
PSUs represent the right to receive, upon settlement of the PSUs after completion of the three-year performance period, a number of shares of the Company’s common stock that may range from zero to two times the number of PSUs granted on the award date. The number of potentially dilutive shares related to PSUs is based on the number of shares, if any, that would be issuable at the end of the respective reporting period, assuming that date was the end of the contingency period applicable to such PSUs. For additional discussion on PSUs, please refer to Note 7 - Compensation Plans under the heading Performance Stock Units Under the Equity Incentive Compensation Plan. | ||||||||||||||||
Although all of the Company’s 3.50% Senior Convertible Notes due 2027 (“3.50% Senior Convertible Notes”) were redeemed or settled prior to September 30, 2012, potentially dilutive securities for this calculation included shares into which the 3.50% Senior Convertible Notes were convertible for the portion of the nine months ended September 30, 2012, for which they were outstanding. The Company’s 3.50% Senior Convertible Notes had a net-share settlement right giving the Company the option to irrevocably elect, by notice to the trustee under the indenture for the notes, to settle the Company’s obligation, in the event that holders of the notes elected to convert all or a portion of their notes, by delivering cash in an amount equal to each $1,000 principal amount of notes surrendered for conversion and, if applicable, at the Company’s option, shares of common stock or cash, or any combination of common stock and cash, for the amount of conversion value in excess of the principal amount. The potentially dilutive shares associated with this conversion feature were accounted for using the treasury stock method when shares of the Company’s common stock traded at an average closing price that exceeded the $54.42 conversion price. Shares of the Company’s common stock traded at an average closing price exceeding the conversion price, and were included on an adjusted weighted basis for the portion of the nine-month period ended September 30, 2012, for which they were outstanding, making them dilutive for that period. The dilutive net income per share calculation for the nine-month period ended September 30, 2012, was adjusted on a weighted basis for the conversion of the 3.50% Senior Convertible Notes. | ||||||||||||||||
The following table sets forth the calculations of basic and diluted earnings per share: | ||||||||||||||||
For the Three Months Ended September 30, | For the Nine Months Ended September 30, | |||||||||||||||
2013 | 2012 | 2013 | 2012 | |||||||||||||
(in thousands, except per share amounts) | ||||||||||||||||
Net income (loss) | $ | 70,690 | $ | (38,336 | ) | $ | 163,939 | $ | 12,889 | |||||||
Basic weighted-average common shares outstanding | 66,943 | 65,745 | 66,486 | 64,815 | ||||||||||||
Add: dilutive effect of stock options, unvested RSUs, and contingent PSUs | 1,310 | — | 1,483 | 1,870 | ||||||||||||
Add: dilutive effect of 3.50% Senior Convertible Notes | — | — | — | 658 | ||||||||||||
Diluted weighted-average common shares outstanding | 68,253 | 65,745 | 67,969 | 67,343 | ||||||||||||
Basic net income (loss) per common share | $ | 1.06 | $ | (0.58 | ) | $ | 2.47 | $ | 0.2 | |||||||
Diluted net income (loss) per common share | $ | 1.04 | $ | (0.58 | ) | $ | 2.41 | $ | 0.19 | |||||||
Income_Taxes
Income Taxes | 9 Months Ended | |||||||||||||||
Sep. 30, 2013 | ||||||||||||||||
Income Tax Disclosure [Abstract] | ||||||||||||||||
Income Taxes | Note 4 - Income Taxes | |||||||||||||||
Income tax expense for the three months and nine months ended September 30, 2013, and 2012, differs from the amounts that would be provided by applying the statutory United States federal income tax rate to income before income taxes as a result of the estimated effect of percentage depletion, the effect of state income taxes, valuation allowance adjustments, and other permanent differences. The quarterly rate can also be impacted by the proportional effects of forecasted net income as of each period end presented. | ||||||||||||||||
The provision for income taxes consists of the following: | ||||||||||||||||
For the Three Months Ended September 30, | For the Nine Months Ended September 30, | |||||||||||||||
2013 | 2012 | 2013 | 2012 | |||||||||||||
(in thousands) | ||||||||||||||||
Current portion of income tax expense (benefit): | ||||||||||||||||
Federal | $ | — | $ | — | $ | — | $ | — | ||||||||
State | (46 | ) | 174 | 302 | 435 | |||||||||||
Deferred portion of income tax expense (benefit) | 42,380 | (22,910 | ) | 98,619 | 7,305 | |||||||||||
Total income tax expense (benefit) | $ | 42,334 | $ | (22,736 | ) | $ | 98,921 | $ | 7,740 | |||||||
37.5 | % | 37.2 | % | 37.6 | % | 37.5 | % | |||||||||
On a year-to-date basis, a change in the Company’s effective tax rate between reported periods will generally reflect differences in its estimated highest marginal state tax rate due to changes in the composition of income from Company activities among various state tax jurisdictions. Cumulative effects of state rate changes are reflected in the period legislation is enacted. Similarly, a tax benefit from a research and development (“R&D”) study is generally recognized in the period claimed. The year-to-date 2013 effective rate is essentially flat compared 2012, but reflects changes in the mix of permanent differences. | ||||||||||||||||
The Company and its subsidiaries file federal income tax returns and various state income tax returns. With certain exceptions, the Company is no longer subject to United States federal or state income tax examinations by these tax authorities for years before 2007. Federal tax law allowing for the calculation of an R&D credit was enacted in 2013, but the Company has not yet commissioned a study to calculate the credit for the 2012 or 2013 tax years. The table above excludes the impact for any credit that would be allowed under the new law. The Internal Revenue Service (“IRS”) initiated an audit in the first quarter of 2012 related to R&D tax credits claimed by the Company for the 2007 through 2010 tax years. On April 23, 2013, the IRS issued a Notice of Proposed Adjustment disallowing $4.6 million of R&D tax credits claimed for open tax years during the audit period. The Company maintains it is entitled to the claimed credits, has timely appealed the IRS’s decision, and agreed to a one-year federal statute extension for the 2008 and 2009 tax years. | ||||||||||||||||
On September 13, 2013, the United States Department of the Treasury and IRS issued the final and re-proposed tangible property regulations effective for tax years beginning January 1, 2014. The Company determined that its tax practices already take into account the regulations’ requirements or such requirements are not material to the Company’s financial statements. |
LongTerm_Debt
Long-Term Debt | 9 Months Ended | |||||||||||
Sep. 30, 2013 | ||||||||||||
Debt Disclosure [Abstract] | ||||||||||||
Long-term debt | Note 5 - Long-term Debt | |||||||||||
Revolving Credit Facility | ||||||||||||
The Company and its lenders entered into a Fifth Amended and Restated Credit Agreement on April 12, 2013, which replaced the Company’s previous credit facility. The Company incurred approximately $3.4 million in additional deferred financing costs associated with the amendment and extension of this credit facility. The credit facility has a maximum loan amount of $2.5 billion, current aggregate lender commitments of $1.3 billion, and a maturity date of April 12, 2018. The initial borrowing base under the credit facility was $1.9 billion. On May 20, 2013, the Company's borrowing base under the credit facility was automatically reduced by 25 percent of the aggregate principal amount of the newly-issued 5.0% Senior Notes due 2024 (the “2024 Notes”), to $1.775 billion. The borrowing base is subject to regular semi-annual redeterminations. On September 6, 2013, the lending group redetermined the Company’s borrowing base under the credit facility and increased it to $2.2 billion. The borrowing base redetermination process under the credit facility considers the value of the Company’s oil and gas properties and other assets, as determined by the bank group. The next scheduled redetermination date is April 1, 2014. Borrowings under the facility are secured by substantially all of the Company’s proved oil and gas properties. | ||||||||||||
The Company must comply with certain financial and non-financial covenants under the terms of its credit facility agreement, including the limitation of the Company’s dividends to no more than $50.0 million per year. The Company was in compliance with all covenants under the credit facility as of September 30, 2013, and through the filing date of this report. The amended credit facility includes the same borrowing base utilization grid included in the Company’s Fourth Amended and Restated Credit Agreement. Please refer to the borrowing base utilization grid in Note 5 - Long-term Debt in the Company’s 2012 Form 10-K. | ||||||||||||
The following table presents the outstanding balance, total amount of letters of credit, and available borrowing capacity under the Company’s credit facility as of October 23, 2013, September 30, 2013, and December 31, 2012: | ||||||||||||
As of October 23, 2013 | As of September 30, 2013 | As of December 31, 2012 | ||||||||||
(in millions) | ||||||||||||
Credit facility balance | $ | 59 | $ | 28 | $ | 340 | ||||||
Letters of credit (1) | $ | 0.8 | $ | 0.8 | $ | 0.8 | ||||||
Available borrowing capacity | $ | 1,240.20 | $ | 1,271.20 | $ | 659.2 | ||||||
(1) Letters of credit reduce the available borrowing capacity under the credit facility on a dollar-for-dollar basis. | ||||||||||||
5.0% Senior Notes Due 2024 | ||||||||||||
On May 20, 2013, the Company issued $500.0 million in aggregate principal amount of 2024 Notes. The 2024 Notes were issued at par and mature on January 15, 2024. The Company received net proceeds of $490.3 million after deducting fees of $9.7 million, which are being amortized as deferred financing costs over the life of the 2024 Notes. The net proceeds were used to reduce the Company’s outstanding credit facility balance. | ||||||||||||
Prior to July 15, 2016, the Company may redeem, on one or more occasions, up to 35 percent of the aggregate principal amount of the 2024 Notes with the net cash proceeds of certain equity offerings at a redemption price of 105.0% of the principal amount thereof, plus accrued and unpaid interest. The Company may also redeem the 2024 Notes, in whole or in part, at any time prior to July 15, 2018, at a redemption price equal to 100 percent of the principal amount of the 2024 Notes to be redeemed, plus a specified make-whole premium and accrued and unpaid interest to the applicable redemption date. | ||||||||||||
On or after July 15, 2018, the Company may also redeem all or, from time to time, a portion of the 2024 Notes at the redemption prices set forth below, during the twelve-month period beginning on July 15 of each applicable year, expressed as a percentage of the principal amount redeemed, plus accrued and unpaid interest: | ||||||||||||
2018 | 102.5 | % | ||||||||||
2019 | 101.667 | % | ||||||||||
2020 | 100.833 | % | ||||||||||
2021 and thereafter | 100 | % | ||||||||||
The 2024 Notes are unsecured senior obligations and rank equal in right of payment with all of the Company’s existing and any future unsecured senior debt, and are senior in right of payment to any future subordinated debt. There are no subsidiary guarantors of the 2024 Notes. The Company is subject to certain covenants under the indenture governing the 2024 Notes that limit the Company’s ability to incur additional indebtedness, issue preferred stock, and make restricted payments, including dividends; provided, however, that the first $6.5 million of dividends paid each year are not restricted by these covenants. The Company was in compliance with all covenants under its 2024 Notes as of September 30, 2013, and through the filing date of this report. | ||||||||||||
Additionally, on May 20, 2013, the Company entered into a registration rights agreement that provides holders of the 2024 Notes certain registration rights under the Securities Act of 1933, as amended (the “Securities Act”). Pursuant to the registration rights agreement, the Company will file an exchange offer registration statement with the Securities and Exchange Commission (“SEC”) with respect to its offer to exchange the 2024 Notes for substantially identical notes that are registered under the Securities Act. Under certain circumstances, the Company has agreed to file a shelf registration statement relating to the resale of the 2024 Notes in lieu of a registered exchange offer. If the exchange offer is not completed on or before May 20, 2014, or if the shelf registration statement, if required, is not declared effective within the time periods specified in the registration rights agreement, the Company has agreed to pay additional interest with respect to the 2024 Notes in an amount not to exceed one percent of the principal amount of the 2024 Notes until the exchange offer is completed or the shelf registration statement is declared effective. |
Commitments_and_Contingencies
Commitments and Contingencies | 9 Months Ended |
Sep. 30, 2013 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Note 6 - Commitments and Contingencies |
Commitments | |
During the third quarter of 2013, the Company entered into various marketing agreements whereby the Company is subject to certain gathering, transportation, and processing through-put commitments for up to 10 years pursuant to each contract. The Company may be required to make periodic deficiency payments for any shortfalls in delivering the minimum applicable annual, semi-annual, or monthly volume commitments. In the event that no product is delivered in accordance with these agreements, the aggregate deficiency payments total approximately $265.8 million as of September 30, 2013. | |
During the third quarter of 2013, the Company entered into an office lease with an initial term of 12 years and minimum lease payments of $12.9 million over the term beginning on the commencement date, which is anticipated to be in the first quarter of 2014. | |
Contingencies | |
The Company is subject to litigation and claims arising in the ordinary course of business. The Company accrues for such items when a liability is probable and the amount can be reasonably estimated. In the opinion of management, the results of such pending litigation and claims will not have a material effect on the results of operations, the financial position, or the cash flows of the Company. | |
On January 27, 2011, Chieftain Royalty Company (“Chieftain”) filed a Class Action Petition against the Company in the District Court of Beaver County, Oklahoma, claiming damages related to royalty valuation on all of the Company’s Oklahoma wells. These claims include breach of contract, breach of fiduciary duty, fraud, unjust enrichment, tortious breach of contract, conspiracy, and conversion, based generally on asserted improper deduction of post-production costs. The Company removed this lawsuit to the United States District Court for the Western District of Oklahoma on February 22, 2011. The Company has responded to the petition and denied the allegations. The district court did not rule on Chieftain’s motion to certify the putative class, and stayed all proceedings until the United States Court of Appeals for the Tenth Circuit issued its rulings on class certification in two similar royalty class action lawsuits. On July 9, 2013, the Tenth Circuit issued its opinions, reversing the trial courts’ grant of class certification and remanding the matters to the trial courts for those cases. The district court presiding over the Company's case subsequently lifted its stay, and the Company expects Chieftain to file a new motion for class certification in the first half of 2015. | |
This case involves complex legal issues and uncertainties; a potentially large class of plaintiffs, and a large number of related producing properties, lease agreements and wells; and an alleged class period commencing in 1988 and spanning the entire producing life of the wells. Because the proceedings are in the early stages, with substantive discovery yet to be conducted, the Company is unable to estimate what impact, if any, the action will have on its financial condition, results of operations or cash flows. The Company is still evaluating the claims, but believes that it has properly paid royalties under Oklahoma law and has and will continue to vigorously defend this case. | |
In an unrelated matter, as of and for the nine months ended September 30, 2013, other operating expenses and accounts payable and accrued expenses included $17.8 million related to ongoing discussions to clarify the royalty payment provisions of various leases on certain South Texas & Gulf Coast acreage, of which $3.6 million of this amount was recorded during the three months ended September 30, 2013. |
Compensation_Plans
Compensation Plans | 9 Months Ended | |||||||||||||||
Sep. 30, 2013 | ||||||||||||||||
Compensation Related Costs [Abstract] | ||||||||||||||||
Compensation Plans | Note 7 - Compensation Plans | |||||||||||||||
Cash Bonus Plan | ||||||||||||||||
During the first nine months of 2013 and 2012, the Company paid $16.0 million and $24.0 million, respectively, for cash bonuses earned during the 2012 and 2011 performance years, respectively. The general and administrative (“G&A”) expense and exploration expense line items in the accompanying statements of operations include $5.8 million and $4.3 million of accrued cash bonus plan expense for the three-month periods ended September 30, 2013, and 2012, respectively, and $16.7 million and $13.6 million for the nine-month periods ended September 30, 2013, and 2012, respectively, related to the respective performance year. | ||||||||||||||||
Restricted Stock Units Under the Equity Incentive Compensation Plan | ||||||||||||||||
The Company grants restricted stock units (“RSUs”) as part of its equity compensation program. Each RSU represents a right to one share of the Company’s common stock to be delivered upon settlement of the award at the end of the specified vesting period. Expense associated with RSUs is recognized as G&A expense and exploration expense over the vesting period of the award. | ||||||||||||||||
Total expense recorded for RSUs for the three-month periods ended September 30, 2013, and 2012, was $3.7 million and $3.9 million, respectively, and $10.0 million and $6.5 million for the nine-month periods ended September 30, 2013, and 2012, respectively. As of September 30, 2013, there was $22.7 million of total unrecognized compensation expense related to unvested RSU awards, which is being amortized through 2016. | ||||||||||||||||
A summary of the status and activity of non-vested RSUs for the nine-month period ended September 30, 2013, is presented in the following table: | ||||||||||||||||
RSUs | Weighted-Average | |||||||||||||||
Grant-Date | ||||||||||||||||
Fair Value | ||||||||||||||||
Non-vested at beginning of year | 496,244 | $ | 51.81 | |||||||||||||
Granted | 329,939 | $ | 60.01 | |||||||||||||
Vested | (206,509 | ) | $ | 49.73 | ||||||||||||
Forfeited | (29,487 | ) | $ | 54.02 | ||||||||||||
Non-vested at end of quarter | 590,187 | $ | 57.02 | |||||||||||||
The fair value of the RSUs granted during the first nine months of 2013 was $19.8 million. These RSUs will vest 1/3rd on each of the next three anniversary dates of the grant. During the first nine months of 2013, the Company settled 206,509 RSUs that related to awards granted in previous years. The Company and the majority of grant participants mutually agreed to net share settle the awards to cover income and payroll tax withholdings as provided for in the plan document and award agreements. As a result, the Company issued 138,807 net shares of common stock. The remaining 67,702 shares were withheld to satisfy income and payroll tax withholding obligations that occurred upon delivery of the shares underlying those RSUs. | ||||||||||||||||
Performance Stock Units Under the Equity Incentive Compensation Plan | ||||||||||||||||
The Company grants performance share units (“PSUs”) as part of its equity compensation program. PSUs are structurally the same as the previously granted performance share awards. The number of shares of the Company’s common stock issued to settle PSUs ranges from zero to two times the number of PSUs awarded and is determined based on the Company’s performance over a three-year measurement period. The performance criteria for the PSUs are based on a combination of the Company’s annualized total shareholder return (“TSR”) for the measurement period and the relative measure of the Company’s TSR compared with the annualized TSRs of a group of peer companies for the measurement period. Expense associated with PSUs is recognized as G&A expense and exploration expense over the vesting period of the award. | ||||||||||||||||
Total expense recorded for PSUs for the three-month periods ended September 30, 2013, and 2012, was $3.5 million and $5.1 million, respectively, and $13.2 million for both of the nine-month periods ended September 30, 2013, and 2012. As of September 30, 2013, there was $22.7 million of total unrecognized compensation expense related to unvested PSUs to be amortized through 2016. | ||||||||||||||||
A summary of the status and activity of non-vested PSUs for the nine-month period ended September 30, 2013, is presented in the following table: | ||||||||||||||||
PSUs (1) | Weighted-Average | |||||||||||||||
Grant-Date | ||||||||||||||||
Fair Value | ||||||||||||||||
Non-vested at beginning of year | 669,308 | $ | 63.91 | |||||||||||||
Granted | 274,831 | $ | 64.13 | |||||||||||||
Vested | (343,307 | ) | $ | 59.99 | ||||||||||||
Forfeited | (22,371 | ) | $ | 69.5 | ||||||||||||
Non-vested at end of quarter | 578,461 | $ | 66.13 | |||||||||||||
_______________________________________ | ||||||||||||||||
(1) | The number of awards assumes a one multiplier. The final number of shares of common stock issued may vary depending on the three-year performance multiplier, which ranges from zero to two. | |||||||||||||||
The fair value of the PSUs granted during the first nine months of 2013 was $17.6 million. These PSUs will fully vest on the third anniversary of the date of the grant. During the first nine months of 2013, the Company settled PSUs that were granted in 2010, which earned a 1.725 times multiplier, by issuing a net 387,461 shares of the Company’s common stock in accordance with the terms of the PSU awards. The Company and the majority of grant participants mutually agreed to net share settle the awards to cover income and payroll tax withholdings as provided for in the plan document and award agreements. As a result, the Company withheld 200,050 shares to satisfy income and payroll tax withholding obligations that occurred upon delivery of the shares underlying those PSUs. | ||||||||||||||||
Stock Option Grants Under the Equity Incentive Compensation Plan | ||||||||||||||||
A summary of activity associated with the Company’s Stock Option Plan for the nine months ended September 30, 2013, is presented in the following table: | ||||||||||||||||
Shares | Weighted- | Aggregate | ||||||||||||||
Average | Intrinsic Value (in thousands) | |||||||||||||||
Exercise Price | ||||||||||||||||
Outstanding, at beginning of year | 267,846 | $ | 14.95 | $ | 9,983 | |||||||||||
Exercised | (177,995 | ) | $ | 13.89 | $ | 8,753 | ||||||||||
Forfeited | — | |||||||||||||||
Outstanding, at end of quarter | 89,851 | $ | 17.01 | $ | 5,407 | |||||||||||
Vested and exercisable, at end of quarter | 89,851 | $ | 17.01 | $ | 5,407 | |||||||||||
As of September 30, 2013, there was no unrecognized compensation expense related to stock option awards. | ||||||||||||||||
Director Shares | ||||||||||||||||
During the nine months ended September 30, 2013, and 2012, the Company issued 28,169 and 30,486 shares, respectively, of its common stock from treasury to its non-employee directors, under the Company’s Equity Incentive Compensation Plan. The Company recorded no compensation expense related to these awards for the three months ended September 30, 2013, and $147,000 of compensation expense related to these awards for the three months ended September 30, 2012. The Company recorded $1.4 million and $1.3 million of compensation expense related to these awards for the nine months ended September 30, 2013, and 2012, respectively. All shares of common stock issued to the Company’s non-employee directors are earned over the one-year service period following the date of grant. | ||||||||||||||||
Employee Stock Purchase Plan | ||||||||||||||||
Under the Company’s Employee Stock Purchase Plan (“ESPP”), eligible employees may purchase shares of the Company’s common stock through payroll deductions of up to 15 percent of eligible compensation, without accruing in excess of $25,000 in value from purchases for each calendar year. The purchase price of the stock is 85 percent of the lower of the fair market value of the stock on the first or last day of the purchase period, and shares issued under the ESPP have no restriction period. The ESPP is intended to qualify under Section 423 of the Internal Revenue Code. The Company had 1.3 million shares available for issuance under the ESPP as of September 30, 2013. The Company issued 44,437 and 37,124 shares under the ESPP during the first nine months of 2013 and 2012, respectively. The fair value of ESPP grants is measured at the date of grant using the Black-Scholes option-pricing model. | ||||||||||||||||
Net Profits Interest Bonus Plan | ||||||||||||||||
Cash payments made or accrued under the Company’s Net Profits Interest Bonus Plan (“Net Profits Plan”) that have been recorded as either G&A expense or exploration expense are presented in the table below: | ||||||||||||||||
For the Three Months Ended September 30, | For the Nine Months Ended September 30, | |||||||||||||||
2013 | 2012 | 2013 | 2012 | |||||||||||||
(in thousands) | ||||||||||||||||
General and administrative expense | $ | 4,302 | $ | 4,083 | $ | 11,531 | $ | 12,177 | ||||||||
Exploration expense | 329 | 403 | 1,026 | 1,421 | ||||||||||||
Total | $ | 4,631 | $ | 4,486 | $ | 12,557 | $ | 13,598 | ||||||||
Additionally, the Company accrued or made cash payments under the Net Profits Plan of $274,000 for the three-month period ended September 30, 2012, and $2.6 million and $2.0 million for the nine-month periods ended September 30, 2013, and 2012, respectively, as a result of divestiture proceeds. There were insignificant cash payments made or accrued relating to divestiture proceeds for the three-month period ended September 30, 2013. These cash payments are accounted for in the loss on divestiture activity line item in the accompanying statements of operations. | ||||||||||||||||
The Company records changes in the present value of estimated future payments under the Net Profits Plan as a separate line item in the accompanying statements of operations. The change in the estimated liability is recorded as a non-cash expense or benefit in the current period. The amount recorded as an expense or benefit associated with the change in the estimated liability is not allocated to G&A expense or exploration expense because it is associated with the future net cash flows from oil and gas properties in the respective pools rather than results being realized through current period production. If the Company allocated the change in liability to these specific functional line items, based on the current allocation of actual distributions made by the Company, such expenses or benefits would predominately be allocated to G&A expense. The amount that would be allocated to exploration expense is minimal in comparison. Over time, less of the amount distributed relates to prospective exploration efforts as more of the amount distributed is paid to employees that have terminated employment and do not provide ongoing exploration support to the Company. |
Pension_Benefits
Pension Benefits | 9 Months Ended | |||||||||||||||
Sep. 30, 2013 | ||||||||||||||||
Defined Benefit Pension Plans and Defined Benefit Postretirement Plans Disclosure [Abstract] | ||||||||||||||||
Pension Benefits | Note 8 - Pension Benefits | |||||||||||||||
Pension Plans | ||||||||||||||||
The Company has a non-contributory pension plan covering substantially all employees who meet age and service requirements (the “Qualified Pension Plan”). The Company also has a supplemental non-contributory pension plan covering certain management employees (the “Nonqualified Pension Plan” and together with the Qualified Pension Plan, the “Pension Plans”). | ||||||||||||||||
Components of Net Periodic Benefit Cost for the Pension Plans | ||||||||||||||||
The following table presents the components of the net periodic benefit cost for the Pension Plans: | ||||||||||||||||
For the Three Months Ended September 30, | For the Nine Months Ended September 30, | |||||||||||||||
2013 | 2012 | 2013 | 2012 | |||||||||||||
(in thousands) | ||||||||||||||||
Service cost | $ | 1,572 | $ | 1,232 | $ | 4,718 | $ | 3,697 | ||||||||
Interest cost | 407 | 345 | 1,220 | 1,034 | ||||||||||||
Expected return on plan assets that reduces periodic pension costs | (384 | ) | (286 | ) | (1,153 | ) | (858 | ) | ||||||||
Amortization of prior service costs | 4 | 4 | 13 | 13 | ||||||||||||
Amortization of net actuarial loss | 306 | 197 | 917 | 591 | ||||||||||||
Net periodic benefit cost | $ | 1,905 | $ | 1,492 | $ | 5,715 | $ | 4,477 | ||||||||
Prior service costs are amortized on a straight-line basis over the average remaining service period of active participants. Gains and losses in excess of 10 percent of the greater of the benefit obligation and the market-related value of assets are amortized over the average remaining service period of active participants. | ||||||||||||||||
Contributions | ||||||||||||||||
During the nine months ended September 30, 2013, the Company made a $4.3 million payment, which satisfied its $373,000 contribution requirement for the 2013 plan year, as well as funded a portion of its expected contribution requirement for the 2014 plan year. |
Derivative_Financial_Instrumen
Derivative Financial Instruments | 9 Months Ended | |||||||||||||||||||
Sep. 30, 2013 | ||||||||||||||||||||
Derivative Instruments and Hedging Activities Disclosure [Abstract] | ||||||||||||||||||||
Derivative Financial Instruments | Note 10 - Derivative Financial Instruments | |||||||||||||||||||
Summary of Oil, Gas, and NGL Derivative Contracts in Place | ||||||||||||||||||||
The Company has entered into various commodity derivative contracts to mitigate a portion of its exposure to potentially adverse market changes in commodity prices and the associated impact on cash flows. All contracts are entered into for other-than-trading purposes. The Company’s derivative contracts include swap and costless collar arrangements for oil, gas, and NGLs. | ||||||||||||||||||||
As of September 30, 2013, and through the filing date of this report, the Company has commodity derivative contracts outstanding through the second quarter of 2018 for a total of 19.8 million Bbls of oil production, 224.4 million MMBtu of gas production, and 0.9 million Bbls of NGL production. | ||||||||||||||||||||
In a typical commodity swap agreement, if the agreed upon published third-party index price is lower than the swap fixed price, the Company receives the difference between the index price and the agreed upon swap fixed price. If the index price is higher than the swap fixed price, the Company pays the difference. For collar agreements, the Company receives the difference between an agreed upon index and the floor price if the index price is below the floor price. The Company pays the difference between the agreed upon ceiling price and the index price if the index price is above the ceiling price. No amounts are paid or received if the index price is between the floor and ceiling prices. | ||||||||||||||||||||
The following tables summarize the approximate volumes and average contract prices of contracts the Company had in place as of September 30, 2013, and through the filing date of this report: | ||||||||||||||||||||
Oil Contracts | ||||||||||||||||||||
Oil Swaps | ||||||||||||||||||||
Contract Period | Volumes | Weighted-Average | ||||||||||||||||||
Contract Price | ||||||||||||||||||||
(Bbls) | (per Bbl) | |||||||||||||||||||
Remainder of 2013 | 1,118,000 | $ | 97.09 | |||||||||||||||||
2014 | 5,164,000 | $ | 95.25 | |||||||||||||||||
2015 | 2,911,000 | $ | 89.06 | |||||||||||||||||
2016 | 2,704,000 | $ | 85.19 | |||||||||||||||||
All oil swaps* | 11,897,000 | |||||||||||||||||||
*Oil swaps are comprised of NYMEX WTI (93%) and Argus Louisiana Light Sweet (“LLS”) (7%). | ||||||||||||||||||||
Oil Collars | ||||||||||||||||||||
Contract Period | NYMEX WTI | Weighted- | Weighted- | |||||||||||||||||
Volumes | Average Floor | Average Ceiling | ||||||||||||||||||
Price | Price | |||||||||||||||||||
(Bbls) | (per Bbl) | (per Bbl) | ||||||||||||||||||
Remainder of 2013 | 1,480,000 | $ | 88.14 | $ | 114.12 | |||||||||||||||
2014 | 3,022,000 | $ | 84.07 | $ | 105.46 | |||||||||||||||
2015 | 3,366,000 | $ | 85 | $ | 94.25 | |||||||||||||||
All oil collars | 7,868,000 | |||||||||||||||||||
Gas Contracts | ||||||||||||||||||||
Gas Swaps | ||||||||||||||||||||
Contract Period | Volumes | Weighted-Average | ||||||||||||||||||
Contract Price | ||||||||||||||||||||
(MMBtu) | (per MMBtu) | |||||||||||||||||||
Remainder of 2013 | 19,047,000 | $ | 4.06 | |||||||||||||||||
2014 | 64,453,000 | $ | 4.06 | |||||||||||||||||
2015 | 49,328,000 | $ | 4.04 | |||||||||||||||||
2016 | 36,126,000 | $ | 4.18 | |||||||||||||||||
2017 | 23,430,000 | $ | 4.21 | |||||||||||||||||
2018 | 10,200,000 | $ | 4.31 | |||||||||||||||||
All gas swaps* | 202,584,000 | |||||||||||||||||||
*Gas swaps are comprised of IF El Paso Permian (3%), IF HSC (72%), IF NGPL TXOK (3%), IF NNG Ventura (2%), IF PEPL (8%), IF Reliant N/S (10%), and IF NGPL MidCont (2%). | ||||||||||||||||||||
Gas Collars | ||||||||||||||||||||
Contract Period | Volumes | Weighted- | Weighted- | |||||||||||||||||
Average Floor | Average Ceiling | |||||||||||||||||||
Price | Price | |||||||||||||||||||
(MMBtu) | (per MMBtu) | (per MMBtu) | ||||||||||||||||||
Remainder of 2013 | 1,640,000 | $ | 4.39 | $ | 5.31 | |||||||||||||||
2014 | 5,734,000 | $ | 4.38 | $ | 5.36 | |||||||||||||||
2015 | 14,480,000 | $ | 3.96 | $ | 4.3 | |||||||||||||||
All gas collars* | 21,854,000 | |||||||||||||||||||
*Gas collars are comprised of IF El Paso Permian (2%), IF HSC (54%), IF NGPL TXOK (4%), IF NNG Ventura (5%), IF PEPL (7%), IF Reliant N/S (15%), and IF TETCO STX (13%). | ||||||||||||||||||||
NGL Contracts | ||||||||||||||||||||
NGL Swaps | ||||||||||||||||||||
Contract Period | Volumes | Weighted-Average | ||||||||||||||||||
Contract Price | ||||||||||||||||||||
(Bbls) | (per Bbl) | |||||||||||||||||||
Remainder of 2013 | 511,000 | $ | 53.16 | |||||||||||||||||
2014 | 404,000 | $ | 58.42 | |||||||||||||||||
All NGL swaps* | 915,000 | |||||||||||||||||||
*NGL swaps are comprised of OPIS Mont Belvieu Purity Ethane (7%), OPIS Mont Belvieu LDH Propane (45%), OPIS Mont Belvieu NON-LDH Isobutane (13%), OPIS Mont Belvieu NON-LDH Normal Butane (16%), and OPIS Mont Belvieu NON-LDH Natural Gasoline (19%). | ||||||||||||||||||||
Derivative Assets and Liabilities Fair Value | ||||||||||||||||||||
The Company’s commodity derivatives are measured at fair value and are included in the accompanying balance sheets as derivative assets and liabilities. The fair value of the commodity derivative contracts was a net asset of $42.4 million and $38.7 million at September 30, 2013, and December 31, 2012, respectively. | ||||||||||||||||||||
The following tables detail the fair value of derivatives recorded in the accompanying balance sheets, by category: | ||||||||||||||||||||
As of September 30, 2013 | ||||||||||||||||||||
Derivative Assets | Derivative Liabilities | |||||||||||||||||||
Balance Sheet | Fair Value | Balance Sheet | Fair Value | |||||||||||||||||
Classification | Classification | |||||||||||||||||||
(in thousands) | ||||||||||||||||||||
Commodity contracts | Current assets | $ | 43,305 | Current liabilities | $ | 22,648 | ||||||||||||||
Commodity contracts | Noncurrent assets | 28,659 | Noncurrent liabilities | 6,873 | ||||||||||||||||
Derivatives not designated as hedging instruments | $ | 71,964 | $ | 29,521 | ||||||||||||||||
As of December 31, 2012 | ||||||||||||||||||||
Derivative Assets | Derivative Liabilities | |||||||||||||||||||
Balance Sheet | Fair Value | Balance Sheet | Fair Value | |||||||||||||||||
Classification | Classification | |||||||||||||||||||
(in thousands) | ||||||||||||||||||||
Commodity contracts | Current assets | $ | 37,873 | Current liabilities | $ | 8,999 | ||||||||||||||
Commodity contracts | Noncurrent assets | 16,466 | Noncurrent liabilities | 6,645 | ||||||||||||||||
Derivatives not designated as hedging instruments | $ | 54,339 | $ | 15,644 | ||||||||||||||||
Offsetting of Derivative Assets and Liabilities | ||||||||||||||||||||
As of September 30, 2013, and December 31, 2012, all derivative instruments held by the Company were subject to enforceable master netting arrangements held by various financial institutions. In general, the terms of the Company’s agreements provide for offsetting of amounts payable or receivable between it and the counterparty, at the election of both parties, for transactions that occur on the same date and in the same currency. The Company’s agreements also provide that in the event of an early termination, the counterparties have the right to offset amounts owed or owing under that and any other agreement with the same counterparty. The Company's accounting policy is to not offset these positions in its accompanying balance sheets. | ||||||||||||||||||||
The following table provides a reconciliation between the gross assets and liabilities reflected on the accompanying balance sheets and the potential effects of master netting arrangements on the fair value of the Company's derivative contracts: | ||||||||||||||||||||
Derivative Assets | Derivative Liabilities | |||||||||||||||||||
As of | As of | |||||||||||||||||||
Offsetting of Derivative Assets and Liabilities | September 30, 2013 | December 31, 2012 | September 30, 2013 | December 31, 2012 | ||||||||||||||||
(in thousands) | ||||||||||||||||||||
Gross amounts presented in the accompanying balance sheets | $ | 71,964 | $ | 54,339 | $ | (29,521 | ) | $ | (15,644 | ) | ||||||||||
Amounts not offset in the accompanying balance sheets | (29,225 | ) | (13,400 | ) | 29,225 | 13,400 | ||||||||||||||
Net amounts | $ | 42,739 | $ | 40,939 | $ | (296 | ) | $ | (2,244 | ) | ||||||||||
Discontinuance of Cash Flow Hedge Accounting | ||||||||||||||||||||
Prior to January 1, 2011, the Company designated its commodity derivative contracts as cash flow hedges, for which unrealized changes in fair value were recorded to AOCIL, to the extent the hedges were effective. As of January 1, 2011, the Company elected to de-designate all of its commodity derivative contracts that had been previously designated as cash flow hedges at December 31, 2010. As a result, subsequent to December 31, 2010, the Company recognizes all gains and losses from changes in commodity derivative fair values immediately in earnings rather than deferring any such amounts in AOCIL. The Company had no derivatives designated as cash flow hedges for the three-month and nine-month periods ended September 30, 2013, and 2012. | ||||||||||||||||||||
As a result of discontinuing hedge accounting on January 1, 2011, fair values at December 31, 2010, were frozen in AOCIL as of the de-designation date and were reclassified into earnings as the original derivative transactions settled. As of September 30, 2013, all commodity derivative contracts that had been previously designated as cash flow hedges have settled and have been reclassified into earnings from AOCIL. Please refer to Note 11 - Fair Value Measurements for more information regarding the Company’s derivative instruments, including its valuation techniques. | ||||||||||||||||||||
The following table summarizes the components of the derivative (gain) loss presented in the accompanying statements of operations: | ||||||||||||||||||||
For the Three Months Ended September 30, | For the Nine Months Ended September 30, | |||||||||||||||||||
2013 | 2012 | 2013 | 2012 | |||||||||||||||||
(in thousands) | ||||||||||||||||||||
Derivative cash settlement (gain) loss: | ||||||||||||||||||||
Oil contracts | $ | 13,538 | $ | 2,472 | $ | 13,786 | $ | 13,142 | ||||||||||||
Gas contracts | (11,019 | ) | (9,031 | ) | (18,752 | ) | (40,495 | ) | ||||||||||||
NGL contracts | (1,231 | ) | (4,362 | ) | (7,749 | ) | (5,450 | ) | ||||||||||||
Total derivative cash settlement (gain) loss (1) | $ | 1,288 | $ | (10,921 | ) | $ | (12,715 | ) | $ | (32,803 | ) | |||||||||
Derivative (gain) loss: | ||||||||||||||||||||
Oil contracts | 30,488 | 30,667 | 8,233 | (32,616 | ) | |||||||||||||||
Gas contracts | (2,264 | ) | 28,231 | (12,462 | ) | 40,464 | ||||||||||||||
NGL contracts | 10,421 | 7,879 | 2,259 | (15,085 | ) | |||||||||||||||
Total derivative (gain) loss (2) | $ | 39,933 | $ | 55,856 | $ | (14,685 | ) | $ | (40,040 | ) | ||||||||||
(1) | Derivative cash settlement (gain) loss is reported in the derivative cash settlement gain line item on the condensed consolidated statements of cash flows within net cash provided by operating activities. | |||||||||||||||||||
(2) | Total derivative (gain) loss is reported in the derivative gain line item on the condensed consolidated statements of cash flows within net cash provided by operating activities. | |||||||||||||||||||
The following table summarizes the effect of derivative instruments on AOCIL and the accompanying statements of operations (net of income tax): | ||||||||||||||||||||
Location in | For the Three Months Ended September 30, | For the Nine Months Ended September 30, | ||||||||||||||||||
Statements of | ||||||||||||||||||||
Derivatives | Operations | 2013 | 2012 | 2013 | 2012 | |||||||||||||||
(in thousands) | ||||||||||||||||||||
Amount reclassified from AOCIL | Commodity contracts | Realized hedge gain (loss) | $ | 308 | $ | (315 | ) | $ | 1,115 | $ | (1,465 | ) | ||||||||
The Company realized a net hedge loss of $489,000 and a net hedge gain of $501,000 from its commodity derivative contracts for the three months ended September 30, 2013, and 2012, respectively, and a net hedge loss of $1.8 million and a net hedge gain of $2.3 million for the nine months ended September 30, 2013, and 2012, respectively, shown net of income tax in the table above. Realized hedge gains and losses are comprised of settlements on commodity derivative contracts that were previously designated as cash flow hedges and are reported in total operating revenues in the accompanying statements of operations. | ||||||||||||||||||||
Credit Related Contingent Features | ||||||||||||||||||||
As of September 30, 2013, and through the filing date of this report, all of the Company’s derivative counterparties were members of the Company’s credit facility syndicate. The Company’s obligations under its credit facility and derivative contracts are secured by liens on substantially all of the Company’s proved oil and gas properties. |
Fair_Value_Measurements_Fair_V
Fair Value Measurements Fair Value Measurements | 9 Months Ended | |||||||||||
Sep. 30, 2013 | ||||||||||||
Fair Value Disclosures [Abstract] | ||||||||||||
Fair Value Disclosures [Text Block] | Note 11 - Fair Value Measurements | |||||||||||
The Company follows fair value measurement authoritative accounting guidance for all assets and liabilities measured at fair value. That authoritative accounting guidance defines fair value as the price that would be received to sell an asset or paid to transfer a liability (an exit price) in an orderly transaction between market participants at the measurement date. Market or observable inputs are the preferred sources of values, followed by assumptions based on hypothetical transactions in the absence of market inputs. The fair value hierarchy for grouping these assets and liabilities is based on the significance level of the following inputs: | ||||||||||||
• | Level 1 – quoted prices in active markets for identical assets or liabilities | |||||||||||
• | Level 2 – quoted prices in active markets for similar assets or liabilities, quoted prices for identical or similar instruments in markets that are not active, and model-derived valuations whose inputs are observable or whose significant value drivers are observable | |||||||||||
• | Level 3 – significant inputs to the valuation model are unobservable | |||||||||||
The following is a listing of the Company’s assets and liabilities that are measured at fair value and their classification within the fair value hierarchy as of September 30, 2013: | ||||||||||||
Level 1 | Level 2 | Level 3 | ||||||||||
(in thousands) | ||||||||||||
Assets: | ||||||||||||
Derivatives (1) | $ | — | $ | 71,964 | $ | — | ||||||
Proved oil and gas properties (2) | $ | — | $ | — | $ | 11,443 | ||||||
Unproved oil and gas properties (2) | $ | — | $ | — | $ | 20,915 | ||||||
Oil and gas properties held for sale (2) | $ | — | $ | — | $ | 15,349 | ||||||
Liabilities: | ||||||||||||
Derivatives (1) | $ | — | $ | 29,521 | $ | — | ||||||
Net Profits Plan (1) | $ | — | $ | — | $ | 72,404 | ||||||
Asset retirement obligation (2) | $ | — | $ | — | $ | 1,573 | ||||||
(1) This represents a financial asset or liability that is measured at fair value on a recurring basis. | ||||||||||||
(2) This represents a non-financial asset or liability that is measured at fair value on a nonrecurring basis. | ||||||||||||
The following is a listing of the Company’s assets and liabilities that are measured at fair value and their classification within the fair value hierarchy as of December 31, 2012: | ||||||||||||
Level 1 | Level 2 | Level 3 | ||||||||||
(in thousands) | ||||||||||||
Assets: | ||||||||||||
Derivatives (1) | $ | — | $ | 54,339 | $ | — | ||||||
Proved oil and gas properties (2) | $ | — | $ | — | $ | 209,959 | ||||||
Unproved oil and gas properties (2) | $ | — | $ | — | $ | 42,765 | ||||||
Oil and gas properties held for sale (2) | $ | — | $ | — | $ | 16,527 | ||||||
Liabilities: | ||||||||||||
Derivatives (1) | $ | — | $ | 15,644 | $ | — | ||||||
Net Profits Plan (1) | $ | — | $ | — | $ | 78,827 | ||||||
(1) This represents a financial asset or liability that is measured at fair value on a recurring basis. | ||||||||||||
(2) This represents a non-financial asset or liability that is measured at fair value on a nonrecurring basis. | ||||||||||||
Both financial and non-financial assets and liabilities are categorized within the above fair value hierarchy based on the lowest level of input that is significant to the fair value measurement. The following is a description of the valuation methodologies used by the Company as well as the general classification of such instruments pursuant to the above fair value hierarchy. | ||||||||||||
Derivatives | ||||||||||||
The Company uses Level 2 inputs to measure the fair value of oil, gas, and NGL commodity derivatives. Fair values are based upon interpolated data. The Company derives internal valuation estimates taking into consideration the counterparties’ credit ratings, the Company’s credit rating, and the time value of money. These valuations are then compared to the respective counterparties’ mark-to-market statements. These factors result in an estimated exit-price that management believes provides a reasonable and consistent methodology for valuing derivative instruments. The derivative instruments utilized by the Company are not considered by management to be complex, structured, or illiquid. The oil, gas, and NGL commodity derivative markets are highly active. | ||||||||||||
Generally, market quotes assume that all counterparties have near zero, or low, default rates and have equal credit quality. However, an adjustment may be necessary to reflect the credit quality of a specific counterparty to determine the fair value of the instrument. The Company monitors the credit ratings of its counterparties and may require counterparties to post collateral if their ratings deteriorate. In some instances the Company will attempt to novate the trade to a more stable counterparty. | ||||||||||||
Valuation adjustments are necessary to reflect the effect of the Company’s credit quality on the fair value of any liability position with a counterparty. This adjustment takes into account any credit enhancements, such as collateral margin that the Company may have posted with a counterparty, as well as any letters of credit between the parties. The methodology to determine this adjustment is consistent with how the Company evaluates counterparty credit risk, taking into account the Company’s credit rating, current credit facility margins, and any change in such margins since the last measurement date. All of the Company’s derivative counterparties are members of the Company’s credit facility bank syndicate. | ||||||||||||
The methods described above may result in a fair value estimate that may not be indicative of net realizable value or may not be reflective of future fair values and cash flows. While the Company believes that the valuation methods utilized are appropriate and consistent with accounting authoritative guidance and with other marketplace participants, the Company recognizes that third parties may use different methodologies or assumptions to determine the fair value of certain financial instruments that could result in a different estimate of fair value at the reporting date. | ||||||||||||
Refer to Note 10 - Derivative Financial Instruments for more information regarding the Company’s derivative instruments. | ||||||||||||
Net Profits Plan | ||||||||||||
The Net Profits Plan is a standalone liability for which there is no available market price, principal market, or market participants. The inputs available for this instrument are unobservable and are therefore classified as Level 3 inputs. The Company employs the income approach, which converts expected future cash flow amounts to a single present value amount. This technique uses the estimate of future cash payments, expectations of possible variations in the amount and/or timing of cash flows, the risk premium, and nonperformance risk to calculate the fair value. There is a direct correlation between realized oil, gas, and NGL commodity prices driving net cash flows and the Net Profits Plan liability. Generally, higher commodity prices result in a larger Net Profits Plan liability and lower commodity prices result in a smaller Net Profits Plan liability. | ||||||||||||
The Company records the estimated fair value of the long-term liability for estimated future payments under the Net Profits Plan based on the discounted value of estimated future payments associated with each individual pool. The calculation of this liability is a significant management estimate. For those pools currently in payout, a discount rate of 12 percent is used to calculate this liability. A discount rate of 15 percent is used to calculate the liability for pools that have not reached payout. These rates are intended to represent the Company's best estimate of the present value of expected future payments under the Net Profits Plan. | ||||||||||||
The Company’s estimate of its liability is highly dependent on commodity prices, cost assumptions, discount rates, and overall market conditions. The Company regularly assesses the current market environment. The Net Profits Plan liability is determined using price assumptions of five one-year strip prices with the fifth year’s pricing then carried out indefinitely. The average price is adjusted for realized price differentials and to include the effects of the forecasted production covered by derivatives contracts in the relevant periods. The non-cash expense associated with this significant management estimate is highly volatile from period to period due to fluctuations that occur in the oil, gas, and NGL commodity markets. | ||||||||||||
If the commodity prices used in the calculation changed by five percent, the liability recorded at September 30, 2013, would differ by approximately $6 million. A one percent increase or decrease in the discount rate would result in a change of approximately $3 million. Actual cash payments to be made to participants in future periods are dependent on realized actual production, realized commodity prices, and costs associated with the properties in each individual pool of the Net Profits Plan. Consequently, actual cash payments are inherently different from the amounts estimated. | ||||||||||||
No published market quotes exist on which to base the Company’s estimate of fair value of its Net Profits Plan liability. As such, the recorded fair value is based entirely on management estimates that are described within this footnote. While some inputs to the Company’s calculation of fair value on the Net Profits Plan’s future payments are from published sources, others, such as the discount rate and the expected future cash flows, are derived from the Company’s own calculations and estimates. | ||||||||||||
The following table reflects the activity for the Company’s Net Profits Plan liability measured at fair value using Level 3 inputs: | ||||||||||||
For the Nine Months Ended September 30, 2013 | ||||||||||||
(in thousands) | ||||||||||||
Beginning balance | $ | 78,827 | ||||||||||
Net increase in liability (1) | 8,736 | |||||||||||
Net settlements (1) (2) | (15,159 | ) | ||||||||||
Transfers in (out) of Level 3 | — | |||||||||||
Ending balance | $ | 72,404 | ||||||||||
(1) | Net changes in the Company’s Net Profits Plan liability are shown in the Change in Net Profits Plan liability line item of the accompanying statements of operations. | |||||||||||
(2) | Settlements represent cash payments made or accrued under the Net Profits Plan. The Company accrued or made cash payments under the Net Profits Plan of $2.6 million relating to divestiture proceeds for the nine months ended September 30, 2013. | |||||||||||
Long-term Debt | ||||||||||||
The following table reflects the fair value of the 6.625% Senior Notes due 2019 (the “2019 Notes”), the 6.50% Senior Notes due 2021 (the “2021 Notes”), the 6.50% Senior Notes due 2023 (the “2023 Notes”), and the 2024 Notes (collectively referred to as the “Senior Notes”) measured using Level 1 inputs based on quoted secondary market trading prices. The Senior Notes were not presented at fair value on the accompanying balance sheets as of September 30, 2013, or December 31, 2012, as they are recorded at historical value. | ||||||||||||
As of September 30, 2013 | As of December 31, 2012 | |||||||||||
(in thousands) | ||||||||||||
2019 Notes | $ | 368,375 | $ | 371,875 | ||||||||
2021 Notes | $ | 374,500 | $ | 371,070 | ||||||||
2023 Notes | $ | 408,000 | $ | 424,200 | ||||||||
2024 Notes (1) | $ | 461,565 | N/A | |||||||||
(1) | The 2024 Notes were issued on May 20, 2013. | |||||||||||
The carrying value of the Company’s credit facility approximates its fair value, as the applicable interest rates are floating, based on prevailing market rates. | ||||||||||||
Proved Oil and Gas Properties | ||||||||||||
Proved oil and gas property costs are evaluated for impairment and reduced to fair value when there is an indication that the carrying costs may not be recoverable. The Company uses Level 3 inputs and the income valuation technique, which converts future amounts to a single present value amount, to measure the fair value of proved properties through an application of discount rates and price forecasts selected by the Company’s management. The calculation of the discount rate is based on the best information available and was estimated to be 12 percent as of September 30, 2013, and December 31, 2012. The Company believes that the discount rate is representative of current market conditions and takes into account estimates of future cash payments, expectations of possible variations in the amount and/or timing of cash flows, the risk premium, and nonperformance risk. The prices for oil and gas are forecasted based on New York Mercantile Exchange (“NYMEX”) strip pricing, adjusted for basis differentials, for the first five years, after which a flat terminal price is used for each commodity stream. The prices for NGLs are forecasted using Oil Price Information System (“OPIS”) Mont Belvieu pricing, adjusted for basis differentials, for as long as the market is actively trading, after which a flat terminal price is used. Future operating costs are also adjusted as deemed appropriate for these estimates. Proved properties classified as held for sale are valued using a market approach, based on an estimated selling price, as evidenced by the most current bid prices received from third parties. If an estimated selling price is not available, the Company utilizes the income valuation technique discussed above. | ||||||||||||
See Unproved Oil and Gas Properties below for discussion of the fair value measurement of acquired oil and gas properties. | ||||||||||||
Unproved Oil and Gas Properties | ||||||||||||
Unproved oil and gas property costs are evaluated for impairment and reduced to fair value when there is an indication that the carrying costs may not be recoverable. To measure the fair value of unproved properties, the Company uses a market approach, which takes into account the following significant assumptions: future development plans, risk weighted potential resource recovery, and estimated reserve values. Unproved properties classified as held for sale are valued using a market approach, based on an estimated selling price, as evidenced by the most current bid prices received from third parties. If an estimated selling price is not available, the Company utilizes a market approach, which estimates acreage value based on the price received for similar acreage in recent transactions by the Company or other market participants in the principal market. | ||||||||||||
Acquisitions of proved and unproved properties are measured at fair value as of the acquisition date using a discounted cash flow model similar to the Company’s approach in measuring the fair value of proved and unproved properties, as discussed in the paragraphs above. Due to the unobservable characteristics of the inputs, the fair value of acquired properties are considered Level 3 within the fair value hierarchy. | ||||||||||||
Asset Retirement Obligations | ||||||||||||
The Company utilizes the income valuation technique to determine the fair value of the asset retirement obligation liability at the point of inception 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 initial measurement of the asset retirement obligation liability is deemed to use Level 3 inputs. There were asset retirement obligations of $1.6 million recorded at fair value in the accompanying balance sheets at September 30, 2013. There were no asset retirement obligations recorded at fair value in the accompanying balance sheets at December 31, 2012. |
Basis_of_Presentation_Signific1
Basis of Presentation, Significant Accounting Policies, and Recently Issued Accounting Standards (Policies) | 9 Months Ended |
Sep. 30, 2013 | |
Accounting Policies [Abstract] | |
Description and terms of the Performance Share Awards | The Company grants performance share units (“PSUs”) as part of its equity compensation program. PSUs are structurally the same as the previously granted performance share awards. The number of shares of the Company’s common stock issued to settle PSUs ranges from zero to two times the number of PSUs awarded and is determined based on the Company’s performance over a three-year measurement period. The performance criteria for the PSUs are based on a combination of the Company’s annualized total shareholder return (“TSR”) for the measurement period and the relative measure of the Company’s TSR compared with the annualized TSRs of a group of peer companies for the measurement period. Expense associated with PSUs is recognized as G&A expense and exploration expense over the vesting period of the award. |
Discontinuance of Cash Flow Hedge Accounting Description | Discontinuance of Cash Flow Hedge Accounting |
Prior to January 1, 2011, the Company designated its commodity derivative contracts as cash flow hedges, for which unrealized changes in fair value were recorded to AOCIL, to the extent the hedges were effective. As of January 1, 2011, the Company elected to de-designate all of its commodity derivative contracts that had been previously designated as cash flow hedges at December 31, 2010. As a result, subsequent to December 31, 2010, the Company recognizes all gains and losses from changes in commodity derivative fair values immediately in earnings rather than deferring any such amounts in AOCIL. The Company had no derivatives designated as cash flow hedges for the three-month and nine-month periods ended September 30, 2013, and 2012. | |
Fair value of financial instruments measured on a recurring Basis | The Company uses Level 2 inputs to measure the fair value of oil, gas, and NGL commodity derivatives. Fair values are based upon interpolated data. The Company derives internal valuation estimates taking into consideration the counterparties’ credit ratings, the Company’s credit rating, and the time value of money. These valuations are then compared to the respective counterparties’ mark-to-market statements. These factors result in an estimated exit-price that management believes provides a reasonable and consistent methodology for valuing derivative instruments. The derivative instruments utilized by the Company are not considered by management to be complex, structured, or illiquid. The oil, gas, and NGL commodity derivative markets are highly active. |
Generally, market quotes assume that all counterparties have near zero, or low, default rates and have equal credit quality. However, an adjustment may be necessary to reflect the credit quality of a specific counterparty to determine the fair value of the instrument. The Company monitors the credit ratings of its counterparties and may require counterparties to post collateral if their ratings deteriorate. In some instances the Company will attempt to novate the trade to a more stable counterparty. | |
Valuation adjustments are necessary to reflect the effect of the Company’s credit quality on the fair value of any liability position with a counterparty. This adjustment takes into account any credit enhancements, such as collateral margin that the Company may have posted with a counterparty, as well as any letters of credit between the parties. The methodology to determine this adjustment is consistent with how the Company evaluates counterparty credit risk, taking into account the Company’s credit rating, current credit facility margins, and any change in such margins since the last measurement date. All of the Company’s derivative counterparties are members of the Company’s credit facility bank syndicate. | |
The methods described above may result in a fair value estimate that may not be indicative of net realizable value or may not be reflective of future fair values and cash flows. While the Company believes that the valuation methods utilized are appropriate and consistent with accounting authoritative guidance and with other marketplace participants, the Company recognizes that third parties may use different methodologies or assumptions to determine the fair value of certain financial instruments that could result in a different estimate of fair value at the reporting date. | |
Refer to Note 10 - Derivative Financial Instruments for more information regarding the Company’s derivative instruments. |
Earnings_per_Share_Tables
Earnings per Share (Tables) | 9 Months Ended | |||||||||||||||
Sep. 30, 2013 | ||||||||||||||||
Earnings Per Share [Abstract] | ||||||||||||||||
Schedule of calculation of basic and diluted earnings per share | The following table sets forth the calculations of basic and diluted earnings per share: | |||||||||||||||
For the Three Months Ended September 30, | For the Nine Months Ended September 30, | |||||||||||||||
2013 | 2012 | 2013 | 2012 | |||||||||||||
(in thousands, except per share amounts) | ||||||||||||||||
Net income (loss) | $ | 70,690 | $ | (38,336 | ) | $ | 163,939 | $ | 12,889 | |||||||
Basic weighted-average common shares outstanding | 66,943 | 65,745 | 66,486 | 64,815 | ||||||||||||
Add: dilutive effect of stock options, unvested RSUs, and contingent PSUs | 1,310 | — | 1,483 | 1,870 | ||||||||||||
Add: dilutive effect of 3.50% Senior Convertible Notes | — | — | — | 658 | ||||||||||||
Diluted weighted-average common shares outstanding | 68,253 | 65,745 | 67,969 | 67,343 | ||||||||||||
Basic net income (loss) per common share | $ | 1.06 | $ | (0.58 | ) | $ | 2.47 | $ | 0.2 | |||||||
Diluted net income (loss) per common share | $ | 1.04 | $ | (0.58 | ) | $ | 2.41 | $ | 0.19 | |||||||
Income_Taxes_Tables
Income Taxes (Tables) | 9 Months Ended | |||||||||||||||
Sep. 30, 2013 | ||||||||||||||||
Income Tax Disclosure [Abstract] | ||||||||||||||||
Schedule of provision for income taxes | The provision for income taxes consists of the following: | |||||||||||||||
For the Three Months Ended September 30, | For the Nine Months Ended September 30, | |||||||||||||||
2013 | 2012 | 2013 | 2012 | |||||||||||||
(in thousands) | ||||||||||||||||
Current portion of income tax expense (benefit): | ||||||||||||||||
Federal | $ | — | $ | — | $ | — | $ | — | ||||||||
State | (46 | ) | 174 | 302 | 435 | |||||||||||
Deferred portion of income tax expense (benefit) | 42,380 | (22,910 | ) | 98,619 | 7,305 | |||||||||||
Total income tax expense (benefit) | $ | 42,334 | $ | (22,736 | ) | $ | 98,921 | $ | 7,740 | |||||||
37.5 | % | 37.2 | % | 37.6 | % | 37.5 | % | |||||||||
LongTerm_Debt_Tables
Long-Term Debt (Tables) | 9 Months Ended | |||||||||||
Sep. 30, 2013 | ||||||||||||
Debt Disclosure [Abstract] | ||||||||||||
Schedule of Long-term Debt Instruments [Table Text Block] | The following table presents the outstanding balance, total amount of letters of credit, and available borrowing capacity under the Company’s credit facility as of October 23, 2013, September 30, 2013, and December 31, 2012: | |||||||||||
As of October 23, 2013 | As of September 30, 2013 | As of December 31, 2012 | ||||||||||
(in millions) | ||||||||||||
Credit facility balance | $ | 59 | $ | 28 | $ | 340 | ||||||
Letters of credit (1) | $ | 0.8 | $ | 0.8 | $ | 0.8 | ||||||
Available borrowing capacity | $ | 1,240.20 | $ | 1,271.20 | $ | 659.2 | ||||||
(1) Letters of credit reduce the available borrowing capacity under the credit facility on a dollar-for-dollar basis. | ||||||||||||
Schedule of Debt Instrument Redemption Price, 5% Senior Notes Due 2024 [Table Text Block] | On or after July 15, 2018, the Company may also redeem all or, from time to time, a portion of the 2024 Notes at the redemption prices set forth below, during the twelve-month period beginning on July 15 of each applicable year, expressed as a percentage of the principal amount redeemed, plus accrued and unpaid interest: | |||||||||||
2018 | 102.5 | % | ||||||||||
2019 | 101.667 | % | ||||||||||
2020 | 100.833 | % | ||||||||||
2021 and thereafter | 100 | % |
Compensation_Plans_Tables
Compensation Plans (Tables) | 9 Months Ended | |||||||||||||||
Sep. 30, 2013 | ||||||||||||||||
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | ||||||||||||||||
Schedule of restricted stock unit incentive program under equity incentive compensation plan | A summary of the status and activity of non-vested RSUs for the nine-month period ended September 30, 2013, is presented in the following table: | |||||||||||||||
RSUs | Weighted-Average | |||||||||||||||
Grant-Date | ||||||||||||||||
Fair Value | ||||||||||||||||
Non-vested at beginning of year | 496,244 | $ | 51.81 | |||||||||||||
Granted | 329,939 | $ | 60.01 | |||||||||||||
Vested | (206,509 | ) | $ | 49.73 | ||||||||||||
Forfeited | (29,487 | ) | $ | 54.02 | ||||||||||||
Non-vested at end of quarter | 590,187 | $ | 57.02 | |||||||||||||
Schedule of performance share awards under equity incentive compensation plan | A summary of the status and activity of non-vested PSUs for the nine-month period ended September 30, 2013, is presented in the following table: | |||||||||||||||
PSUs (1) | Weighted-Average | |||||||||||||||
Grant-Date | ||||||||||||||||
Fair Value | ||||||||||||||||
Non-vested at beginning of year | 669,308 | $ | 63.91 | |||||||||||||
Granted | 274,831 | $ | 64.13 | |||||||||||||
Vested | (343,307 | ) | $ | 59.99 | ||||||||||||
Forfeited | (22,371 | ) | $ | 69.5 | ||||||||||||
Non-vested at end of quarter | 578,461 | $ | 66.13 | |||||||||||||
_______________________________________ | ||||||||||||||||
(1) | The number of awards assumes a one multiplier. The final number of shares of common stock issued may vary depending on the three-year performance multiplier, which ranges from zero to two. | |||||||||||||||
Schedule of stock option grants under prior stock option plans | A summary of activity associated with the Company’s Stock Option Plan for the nine months ended September 30, 2013, is presented in the following table: | |||||||||||||||
Shares | Weighted- | Aggregate | ||||||||||||||
Average | Intrinsic Value (in thousands) | |||||||||||||||
Exercise Price | ||||||||||||||||
Outstanding, at beginning of year | 267,846 | $ | 14.95 | $ | 9,983 | |||||||||||
Exercised | (177,995 | ) | $ | 13.89 | $ | 8,753 | ||||||||||
Forfeited | — | |||||||||||||||
Outstanding, at end of quarter | 89,851 | $ | 17.01 | $ | 5,407 | |||||||||||
Vested and exercisable, at end of quarter | 89,851 | $ | 17.01 | $ | 5,407 | |||||||||||
Schedule of Net Profits Plan Cash Payment Allocation | Cash payments made or accrued under the Company’s Net Profits Interest Bonus Plan (“Net Profits Plan”) that have been recorded as either G&A expense or exploration expense are presented in the table below: | |||||||||||||||
For the Three Months Ended September 30, | For the Nine Months Ended September 30, | |||||||||||||||
2013 | 2012 | 2013 | 2012 | |||||||||||||
(in thousands) | ||||||||||||||||
General and administrative expense | $ | 4,302 | $ | 4,083 | $ | 11,531 | $ | 12,177 | ||||||||
Exploration expense | 329 | 403 | 1,026 | 1,421 | ||||||||||||
Total | $ | 4,631 | $ | 4,486 | $ | 12,557 | $ | 13,598 | ||||||||
Pension_Benefits_Tables
Pension Benefits (Tables) | 9 Months Ended | |||||||||||||||
Sep. 30, 2013 | ||||||||||||||||
Defined Benefit Pension Plans and Defined Benefit Postretirement Plans Disclosure [Abstract] | ||||||||||||||||
Components of the net periodic benefit cost for both the Qualified and the Nonqualified Pension Plan | The following table presents the components of the net periodic benefit cost for the Pension Plans: | |||||||||||||||
For the Three Months Ended September 30, | For the Nine Months Ended September 30, | |||||||||||||||
2013 | 2012 | 2013 | 2012 | |||||||||||||
(in thousands) | ||||||||||||||||
Service cost | $ | 1,572 | $ | 1,232 | $ | 4,718 | $ | 3,697 | ||||||||
Interest cost | 407 | 345 | 1,220 | 1,034 | ||||||||||||
Expected return on plan assets that reduces periodic pension costs | (384 | ) | (286 | ) | (1,153 | ) | (858 | ) | ||||||||
Amortization of prior service costs | 4 | 4 | 13 | 13 | ||||||||||||
Amortization of net actuarial loss | 306 | 197 | 917 | 591 | ||||||||||||
Net periodic benefit cost | $ | 1,905 | $ | 1,492 | $ | 5,715 | $ | 4,477 | ||||||||
Derivative_Financial_Instrumen1
Derivative Financial Instruments (Tables) | 9 Months Ended | |||||||||||||||||||
Sep. 30, 2013 | ||||||||||||||||||||
Derivative Instruments and Hedging Activities Disclosure [Abstract] | ||||||||||||||||||||
Schedule of Notional Amounts of Outstanding Derivative Positions [Table Text Block] | The following tables summarize the approximate volumes and average contract prices of contracts the Company had in place as of September 30, 2013, and through the filing date of this report: | |||||||||||||||||||
Oil Contracts | ||||||||||||||||||||
Oil Swaps | ||||||||||||||||||||
Contract Period | Volumes | Weighted-Average | ||||||||||||||||||
Contract Price | ||||||||||||||||||||
(Bbls) | (per Bbl) | |||||||||||||||||||
Remainder of 2013 | 1,118,000 | $ | 97.09 | |||||||||||||||||
2014 | 5,164,000 | $ | 95.25 | |||||||||||||||||
2015 | 2,911,000 | $ | 89.06 | |||||||||||||||||
2016 | 2,704,000 | $ | 85.19 | |||||||||||||||||
All oil swaps* | 11,897,000 | |||||||||||||||||||
*Oil swaps are comprised of NYMEX WTI (93%) and Argus Louisiana Light Sweet (“LLS”) (7%). | ||||||||||||||||||||
Oil Collars | ||||||||||||||||||||
Contract Period | NYMEX WTI | Weighted- | Weighted- | |||||||||||||||||
Volumes | Average Floor | Average Ceiling | ||||||||||||||||||
Price | Price | |||||||||||||||||||
(Bbls) | (per Bbl) | (per Bbl) | ||||||||||||||||||
Remainder of 2013 | 1,480,000 | $ | 88.14 | $ | 114.12 | |||||||||||||||
2014 | 3,022,000 | $ | 84.07 | $ | 105.46 | |||||||||||||||
2015 | 3,366,000 | $ | 85 | $ | 94.25 | |||||||||||||||
All oil collars | 7,868,000 | |||||||||||||||||||
Gas Contracts | ||||||||||||||||||||
Gas Swaps | ||||||||||||||||||||
Contract Period | Volumes | Weighted-Average | ||||||||||||||||||
Contract Price | ||||||||||||||||||||
(MMBtu) | (per MMBtu) | |||||||||||||||||||
Remainder of 2013 | 19,047,000 | $ | 4.06 | |||||||||||||||||
2014 | 64,453,000 | $ | 4.06 | |||||||||||||||||
2015 | 49,328,000 | $ | 4.04 | |||||||||||||||||
2016 | 36,126,000 | $ | 4.18 | |||||||||||||||||
2017 | 23,430,000 | $ | 4.21 | |||||||||||||||||
2018 | 10,200,000 | $ | 4.31 | |||||||||||||||||
All gas swaps* | 202,584,000 | |||||||||||||||||||
*Gas swaps are comprised of IF El Paso Permian (3%), IF HSC (72%), IF NGPL TXOK (3%), IF NNG Ventura (2%), IF PEPL (8%), IF Reliant N/S (10%), and IF NGPL MidCont (2%). | ||||||||||||||||||||
Gas Collars | ||||||||||||||||||||
Contract Period | Volumes | Weighted- | Weighted- | |||||||||||||||||
Average Floor | Average Ceiling | |||||||||||||||||||
Price | Price | |||||||||||||||||||
(MMBtu) | (per MMBtu) | (per MMBtu) | ||||||||||||||||||
Remainder of 2013 | 1,640,000 | $ | 4.39 | $ | 5.31 | |||||||||||||||
2014 | 5,734,000 | $ | 4.38 | $ | 5.36 | |||||||||||||||
2015 | 14,480,000 | $ | 3.96 | $ | 4.3 | |||||||||||||||
All gas collars* | 21,854,000 | |||||||||||||||||||
*Gas collars are comprised of IF El Paso Permian (2%), IF HSC (54%), IF NGPL TXOK (4%), IF NNG Ventura (5%), IF PEPL (7%), IF Reliant N/S (15%), and IF TETCO STX (13%). | ||||||||||||||||||||
NGL Contracts | ||||||||||||||||||||
NGL Swaps | ||||||||||||||||||||
Contract Period | Volumes | Weighted-Average | ||||||||||||||||||
Contract Price | ||||||||||||||||||||
(Bbls) | (per Bbl) | |||||||||||||||||||
Remainder of 2013 | 511,000 | $ | 53.16 | |||||||||||||||||
2014 | 404,000 | $ | 58.42 | |||||||||||||||||
All NGL swaps* | 915,000 | |||||||||||||||||||
*NGL swaps are comprised of OPIS Mont Belvieu Purity Ethane (7%), OPIS Mont Belvieu LDH Propane (45%), OPIS Mont Belvieu NON-LDH Isobutane (13%), OPIS Mont Belvieu NON-LDH Normal Butane (16%), and OPIS Mont Belvieu NON-LDH Natural Gasoline (19%). | ||||||||||||||||||||
Schedule of fair value of derivatives in accompanying balance sheets | The following tables detail the fair value of derivatives recorded in the accompanying balance sheets, by category: | |||||||||||||||||||
As of September 30, 2013 | ||||||||||||||||||||
Derivative Assets | Derivative Liabilities | |||||||||||||||||||
Balance Sheet | Fair Value | Balance Sheet | Fair Value | |||||||||||||||||
Classification | Classification | |||||||||||||||||||
(in thousands) | ||||||||||||||||||||
Commodity contracts | Current assets | $ | 43,305 | Current liabilities | $ | 22,648 | ||||||||||||||
Commodity contracts | Noncurrent assets | 28,659 | Noncurrent liabilities | 6,873 | ||||||||||||||||
Derivatives not designated as hedging instruments | $ | 71,964 | $ | 29,521 | ||||||||||||||||
As of December 31, 2012 | ||||||||||||||||||||
Derivative Assets | Derivative Liabilities | |||||||||||||||||||
Balance Sheet | Fair Value | Balance Sheet | Fair Value | |||||||||||||||||
Classification | Classification | |||||||||||||||||||
(in thousands) | ||||||||||||||||||||
Commodity contracts | Current assets | $ | 37,873 | Current liabilities | $ | 8,999 | ||||||||||||||
Commodity contracts | Noncurrent assets | 16,466 | Noncurrent liabilities | 6,645 | ||||||||||||||||
Derivatives not designated as hedging instruments | $ | 54,339 | $ | 15,644 | ||||||||||||||||
Schedule of the potential effects of master netting arrangements [Table Text Block] | The following table provides a reconciliation between the gross assets and liabilities reflected on the accompanying balance sheets and the potential effects of master netting arrangements on the fair value of the Company's derivative contracts: | |||||||||||||||||||
Derivative Assets | Derivative Liabilities | |||||||||||||||||||
As of | As of | |||||||||||||||||||
Offsetting of Derivative Assets and Liabilities | September 30, 2013 | December 31, 2012 | September 30, 2013 | December 31, 2012 | ||||||||||||||||
(in thousands) | ||||||||||||||||||||
Gross amounts presented in the accompanying balance sheets | $ | 71,964 | $ | 54,339 | $ | (29,521 | ) | $ | (15,644 | ) | ||||||||||
Amounts not offset in the accompanying balance sheets | (29,225 | ) | (13,400 | ) | 29,225 | 13,400 | ||||||||||||||
Net amounts | $ | 42,739 | $ | 40,939 | $ | (296 | ) | $ | (2,244 | ) | ||||||||||
Schedule of derivative (gain) loss | The following table summarizes the components of the derivative (gain) loss presented in the accompanying statements of operations: | |||||||||||||||||||
For the Three Months Ended September 30, | For the Nine Months Ended September 30, | |||||||||||||||||||
2013 | 2012 | 2013 | 2012 | |||||||||||||||||
(in thousands) | ||||||||||||||||||||
Derivative cash settlement (gain) loss: | ||||||||||||||||||||
Oil contracts | $ | 13,538 | $ | 2,472 | $ | 13,786 | $ | 13,142 | ||||||||||||
Gas contracts | (11,019 | ) | (9,031 | ) | (18,752 | ) | (40,495 | ) | ||||||||||||
NGL contracts | (1,231 | ) | (4,362 | ) | (7,749 | ) | (5,450 | ) | ||||||||||||
Total derivative cash settlement (gain) loss (1) | $ | 1,288 | $ | (10,921 | ) | $ | (12,715 | ) | $ | (32,803 | ) | |||||||||
Derivative (gain) loss: | ||||||||||||||||||||
Oil contracts | 30,488 | 30,667 | 8,233 | (32,616 | ) | |||||||||||||||
Gas contracts | (2,264 | ) | 28,231 | (12,462 | ) | 40,464 | ||||||||||||||
NGL contracts | 10,421 | 7,879 | 2,259 | (15,085 | ) | |||||||||||||||
Total derivative (gain) loss (2) | $ | 39,933 | $ | 55,856 | $ | (14,685 | ) | $ | (40,040 | ) | ||||||||||
(1) | Derivative cash settlement (gain) loss is reported in the derivative cash settlement gain line item on the condensed consolidated statements of cash flows within net cash provided by operating activities. | |||||||||||||||||||
(2) | Total derivative (gain) loss is reported in the derivative gain line item on the condensed consolidated statements of cash flows within net cash provided by operating activities. | |||||||||||||||||||
Detail of the effect of derivative instruments reclassified from AOCI to the statement of operations (net of income tax) | The following table summarizes the effect of derivative instruments on AOCIL and the accompanying statements of operations (net of income tax): | |||||||||||||||||||
Location in | For the Three Months Ended September 30, | For the Nine Months Ended September 30, | ||||||||||||||||||
Statements of | ||||||||||||||||||||
Derivatives | Operations | 2013 | 2012 | 2013 | 2012 | |||||||||||||||
(in thousands) | ||||||||||||||||||||
Amount reclassified from AOCIL | Commodity contracts | Realized hedge gain (loss) | $ | 308 | $ | (315 | ) | $ | 1,115 | $ | (1,465 | ) | ||||||||
Fair_Value_Measurements_Tables
Fair Value Measurements (Tables) | 9 Months Ended | |||||||||||
Sep. 30, 2013 | ||||||||||||
Fair Value Disclosures [Abstract] | ||||||||||||
Fair Value, Assets Measured on Recurring and Nonrecurring Basis [Table Text Block] | The following is a listing of the Company’s assets and liabilities that are measured at fair value and their classification within the fair value hierarchy as of September 30, 2013: | |||||||||||
Level 1 | Level 2 | Level 3 | ||||||||||
(in thousands) | ||||||||||||
Assets: | ||||||||||||
Derivatives (1) | $ | — | $ | 71,964 | $ | — | ||||||
Proved oil and gas properties (2) | $ | — | $ | — | $ | 11,443 | ||||||
Unproved oil and gas properties (2) | $ | — | $ | — | $ | 20,915 | ||||||
Oil and gas properties held for sale (2) | $ | — | $ | — | $ | 15,349 | ||||||
Liabilities: | ||||||||||||
Derivatives (1) | $ | — | $ | 29,521 | $ | — | ||||||
Net Profits Plan (1) | $ | — | $ | — | $ | 72,404 | ||||||
Asset retirement obligation (2) | $ | — | $ | — | $ | 1,573 | ||||||
(1) This represents a financial asset or liability that is measured at fair value on a recurring basis. | ||||||||||||
(2) This represents a non-financial asset or liability that is measured at fair value on a nonrecurring basis. | ||||||||||||
The following is a listing of the Company’s assets and liabilities that are measured at fair value and their classification within the fair value hierarchy as of December 31, 2012: | ||||||||||||
Level 1 | Level 2 | Level 3 | ||||||||||
(in thousands) | ||||||||||||
Assets: | ||||||||||||
Derivatives (1) | $ | — | $ | 54,339 | $ | — | ||||||
Proved oil and gas properties (2) | $ | — | $ | — | $ | 209,959 | ||||||
Unproved oil and gas properties (2) | $ | — | $ | — | $ | 42,765 | ||||||
Oil and gas properties held for sale (2) | $ | — | $ | — | $ | 16,527 | ||||||
Liabilities: | ||||||||||||
Derivatives (1) | $ | — | $ | 15,644 | $ | — | ||||||
Net Profits Plan (1) | $ | — | $ | — | $ | 78,827 | ||||||
(1) This represents a financial asset or liability that is measured at fair value on a recurring basis. | ||||||||||||
(2) This represents a non-financial asset or liability that is measured at fair value on a nonrecurring basis. | ||||||||||||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Table Text Block] | The following table reflects the activity for the Company’s Net Profits Plan liability measured at fair value using Level 3 inputs: | |||||||||||
For the Nine Months Ended September 30, 2013 | ||||||||||||
(in thousands) | ||||||||||||
Beginning balance | $ | 78,827 | ||||||||||
Net increase in liability (1) | 8,736 | |||||||||||
Net settlements (1) (2) | (15,159 | ) | ||||||||||
Transfers in (out) of Level 3 | — | |||||||||||
Ending balance | $ | 72,404 | ||||||||||
(1) | Net changes in the Company’s Net Profits Plan liability are shown in the Change in Net Profits Plan liability line item of the accompanying statements of operations. | |||||||||||
(2) | Settlements represent cash payments made or accrued under the Net Profits Plan. The Company accrued or made cash payments under the Net Profits Plan of $2.6 million relating to divestiture proceeds for the nine months ended September 30, 2013. | |||||||||||
Fair Value, by Balance Sheet Grouping [Table Text Block] | The following table reflects the fair value of the 6.625% Senior Notes due 2019 (the “2019 Notes”), the 6.50% Senior Notes due 2021 (the “2021 Notes”), the 6.50% Senior Notes due 2023 (the “2023 Notes”), and the 2024 Notes (collectively referred to as the “Senior Notes”) measured using Level 1 inputs based on quoted secondary market trading prices. The Senior Notes were not presented at fair value on the accompanying balance sheets as of September 30, 2013, or December 31, 2012, as they are recorded at historical value. | |||||||||||
As of September 30, 2013 | As of December 31, 2012 | |||||||||||
(in thousands) | ||||||||||||
2019 Notes | $ | 368,375 | $ | 371,875 | ||||||||
2021 Notes | $ | 374,500 | $ | 371,070 | ||||||||
2023 Notes | $ | 408,000 | $ | 424,200 | ||||||||
2024 Notes (1) | $ | 461,565 | N/A | |||||||||
(1) | The 2024 Notes were issued on May 20, 2013. |
Assets_Held_for_Sale_Details
Assets Held for Sale (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 | Dec. 31, 2012 |
Assets Held for Sale | |||||
Assets held-for-sale reasonably certain period for sale | 1 | ||||
Oil and gas properties held for sale net of accumulated depletion, depreciation and amortization of $539,769 in 2013 and 20,676 in 2012 | $400,393 | $400,393 | $33,620 | ||
Asset retirement obligation associated with oil and gas properties held for sale | 25,339 | 25,339 | 1,393 | ||
Impairment of oil and gas properties | 5,935 | 0 | 61,706 | 38,523 | |
Oil and Gas Properties [Member] | |||||
Assets Held for Sale | |||||
Impairment of oil and gas properties | $8,700 | $10,100 |
Earnings_per_Share_Details
Earnings per Share (Details) (USD $) | 3 Months Ended | 9 Months Ended | ||
Share data in Thousands, except Per Share data, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 |
Calculation of basic and diluted earnings per share | ||||
Net income (loss) | $70,690,000 | ($38,336,000) | $163,939,000 | $12,889,000 |
Basic weighted-average common shares outstanding | 66,943 | 65,745 | 66,486 | 64,815 |
Add: dilutive effect of stock options, unvested RSU's, and contingent PSU's | 1,310 | 0 | 1,483 | 1,870 |
Add: dilutive effect of 3.50% Senior Convertible Notes | 0 | 0 | 0 | 658 |
Diluted weighted-average common shares outstanding | 68,253 | 65,745 | 67,969 | 67,343 |
Basic net income (loss) per common share | $1.06 | ($0.58) | $2.47 | $0.20 |
Diluted net income (loss) per common share | $1.04 | ($0.58) | $2.41 | $0.19 |
Performance Shares [Member] | ||||
Earnings per share | ||||
Performance period to receive awards (in years) | 3 | |||
Common stock awards vesting multiplier, low end of range | 0 | |||
Common stock awards vesting multiplier, high end of range | 2 | |||
Convertible Debt [Member] | ||||
Earnings per share | ||||
Interest rate on notes (as a percent) | 3.50% | 3.50% | ||
Debt Instrument, Principal Amount Denominator for Conversion into Common Stock | $1,000 | |||
Common stock conversion price (in dollars per share) | $54.42 | $54.42 |
Income_Taxes_Details
Income Taxes (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 |
Components of the provision for income taxes | ||||
Federal | $0 | $0 | $0 | $0 |
State | -46 | 174 | 302 | 435 |
Deferred portion of income tax expense | -42,380 | 22,910 | -98,619 | -7,305 |
Income tax (expense) benefit | ($42,334) | $22,736 | ($98,921) | ($7,740) |
Effective tax rate | 37.50% | 37.20% | 37.60% | 37.50% |
LongTerm_Debt_Details
Long-Term Debt (Details) (USD $) | 9 Months Ended | |||||||||
Sep. 30, 2013 | Sep. 30, 2012 | Oct. 23, 2013 | Sep. 06, 2013 | 20-May-13 | Apr. 12, 2013 | Dec. 31, 2012 | ||||
Debt Instrument [Line Items] | ||||||||||
Line of Credit Facility, Maximum Borrowing Capacity | $2,500,000,000 | |||||||||
Line of Credit Facility, Current Borrowing Capacity | 1,300,000,000 | |||||||||
Borrowing Base, Line of Credit | 2,200,000,000 | 1,775,000,000 | 1,900,000,000 | |||||||
Reduction in Borrowing Base as a Percent of Senior Debt Prinicipal | 25.00% | |||||||||
Line of Credit, Covenant Compliance, Maximum Annual Dividend Payment | 50,000,000 | |||||||||
Revolving credit facility | 28,000,000 | 59,000,000 | 340,000,000 | |||||||
Letters of Credit Outstanding, Amount | 800,000 | [1] | 800,000 | [1] | 800,000 | [1] | ||||
Line of Credit Facility, Remaining Borrowing Capacity | 1,271,200,000 | 1,240,200,000 | 659,200,000 | |||||||
Deferred Finance Costs, Gross | 3,400,000 | |||||||||
Proceeds from Debt Issuance, Net of Issuance Costs, 5% Senior Notes | 490,274,000 | 0 | ||||||||
5.0% Senior Notes Due 2024 [Member] | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Interest rate on notes (as a percent) | 5.00% | 5.00% | 5.00% | |||||||
Deferred Finance Costs, Gross | 9,700,000 | |||||||||
Debt Instrument, Maximum Early Redemption, Percent Of Principal | 35.00% | |||||||||
Debt Instrument Future Redemption Price As Percentageof Principal First Through Third Year | 105.00% | |||||||||
Debt Instrument, Call Feature | at a redemption price equal to 100 percent of the principal amount of the 2024 Notes to be redeemed, plus a specified make-whole premium and accrued and unpaid interest to the applicable redemption date.B | |||||||||
Debt Instrument, Covenant Compliance, Dividends Excluded From Computation | 6,500,000 | |||||||||
Debt Instrument, Face Amount | $500,000,000 | |||||||||
2018 [Member] | 5.0% Senior Notes Due 2024 [Member] | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Early Debt Redemption, Redemption Price as a Percent of Face Amount | 102.50% | |||||||||
2019 [Member] | 5.0% Senior Notes Due 2024 [Member] | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Early Debt Redemption, Redemption Price as a Percent of Face Amount | 101.67% | |||||||||
2020 [Member] | 5.0% Senior Notes Due 2024 [Member] | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Early Debt Redemption, Redemption Price as a Percent of Face Amount | 100.83% | |||||||||
2021 and Thereafter [Member] | 5.0% Senior Notes Due 2024 [Member] | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Early Debt Redemption, Redemption Price as a Percent of Face Amount | 100.00% | |||||||||
[1] | (1) Letters of credit reduce the available borrowing capacity under the credit facility on a dollar-for-dollar basis. |
Commitments_and_Contingencies_
Commitments and Contingencies Commitments and Contingencies (Details) (USD $) | 9 Months Ended |
In Millions, unless otherwise specified | Sep. 30, 2013 |
Commitments and Contingencies | |
Estimated Litigation Liability | $17.80 |
Gas gathering and Oil and Gas Through-put Commitments [Member] | |
Commitments and Contingencies | |
Long-term Purchase Commitment, Amount | 265.8 |
Office Space Leases [Member] | |
Commitments and Contingencies | |
Long-term Purchase Commitment, Amount | $12.90 |
Compensation_Plans_Details
Compensation Plans (Details) (USD $) | 3 Months Ended | 9 Months Ended | ||||
Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | |||
RSUs, PSUs, and Director's Shares [Abstract] | ||||||
Stock-based compensation expense | $25,495,000 | $21,731,000 | ||||
Cash Bonus Plan [Member] | ||||||
Compensation plans | ||||||
Accrued Cash Bonus Plan Expense | 5,800,000 | 4,300,000 | 16,700,000 | 13,600,000 | ||
Restricted Stock Units (RSUs) [Member] | ||||||
RSUs, PSUs, and Director's Shares [Abstract] | ||||||
Number of Common Shares to be Received Upon Settlement | 1 | |||||
Stock-based compensation expense | 3,700,000 | 3,900,000 | 10,000,000 | 6,500,000 | ||
Unrecognized stock based compensation expense | 22,700,000 | 22,700,000 | ||||
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Granted in Period, Total Fair Value | 19,800,000 | |||||
Share-based Compensation Arrangement by Share-based Payment Award, Shares Issued in Period, Net of Shares Withheld for Tax | 138,807 | |||||
Shares Paid for Tax Withholding for Share Based Compensation | 67,702 | |||||
Activity | ||||||
Non-vested at the beginning of the period (in shares) | 496,244 | |||||
Granted (in shares) | 329,939 | |||||
Vested (in shares) | -206,509 | |||||
Forfeited (in shares) | -29,487 | |||||
Non-vested at the ending of the period (in shares) | 590,187 | 590,187 | ||||
Weighted Average Grant Date Fair Value | ||||||
Non-vested outstanding at the beginning of the period (in dollars per share) | $51.81 | |||||
Granted (in dollars per share) | $60.01 | |||||
Vested (in dollars per share) | $49.73 | |||||
Forfeited (in dollars per share) | $54.02 | |||||
Non-vested outstanding at the ending of the period (in dollars per share) | $57.02 | $57.02 | ||||
Performance Shares [Member] | ||||||
Compensation plans | ||||||
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Vested in Period, Multiplier Assumed | 1 | |||||
Share-based Compensation, Awards Other Than Options, Performance Measurement Period | 3 | |||||
RSUs, PSUs, and Director's Shares [Abstract] | ||||||
Stock-based compensation expense | 3,500,000 | 5,100,000 | 13,200,000 | |||
Unrecognized stock based compensation expense | 22,700,000 | 22,700,000 | ||||
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Granted in Period, Total Fair Value | 17,600,000 | |||||
Share-based Compensation Arrangement by Share-based Payment Award, Shares Issued in Period, Net of Shares Withheld for Tax | 387,461 | |||||
Shares Paid for Tax Withholding for Share Based Compensation | 200,050 | |||||
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Rights, Low End of Range | 0 | |||||
Common stock awards vesting multiplier, high end of range | 2 | |||||
Multiplier Applied to PSU Awards at Settlement | 1.725 | |||||
Activity | ||||||
Non-vested at the beginning of the period (in shares) | 669,308 | [1] | ||||
Granted (in shares) | 274,831 | [1] | ||||
Vested (in shares) | -343,307 | [1] | ||||
Forfeited (in shares) | -22,371 | [1] | ||||
Non-vested at the ending of the period (in shares) | 578,461 | [1] | 578,461 | [1] | ||
Weighted Average Grant Date Fair Value | ||||||
Non-vested outstanding at the beginning of the period (in dollars per share) | $63.91 | |||||
Granted (in dollars per share) | $64.13 | |||||
Vested (in dollars per share) | $59.99 | |||||
Forfeited (in dollars per share) | $69.50 | |||||
Non-vested outstanding at the ending of the period (in dollars per share) | $66.13 | $66.13 | ||||
Employee Stock Option [Member] | ||||||
Stock option activity | ||||||
Stock options outstanding at the beginning of the year (in shares) | 267,846 | |||||
Exercised | -177,995 | |||||
Forfeited | 0 | |||||
Stock options vested and exercisable at the end of the period (in shares) | 89,851 | 89,851 | ||||
Weighted-Average Exercise Price | ||||||
Stock options outstanding at the beginning of the period (in dollars per share) | $14.95 | |||||
Exercised (in dollars per share) | $13.89 | |||||
Forfeited (in dollars per share) | ||||||
Stock options outstanding at the end of the period (in dollars per share) | $17.01 | $17.01 | ||||
Stock options vested and exercisable at the end of the period (in dollars per share) | $17.01 | $17.01 | ||||
Aggregate Intrinsic Value | ||||||
Outstanding at the beginning of the period | 9,983,000 | |||||
Exercised | 8,753,000 | |||||
Outstanding at the end of the period | 5,407,000 | 5,407,000 | ||||
Vested at the end of the period | 5,407,000 | 5,407,000 | ||||
Shares Issued to the Board of Directors [Member] | ||||||
Compensation plans | ||||||
Stock Issued During Period, Shares, Share-based Compensation, Gross | 28,169 | 30,486 | ||||
RSUs, PSUs, and Director's Shares [Abstract] | ||||||
Stock-based compensation expense | 147,000 | 1,400,000 | 1,300,000 | |||
Employee Stock [Member] | ||||||
Employee Stock Purchase Program | ||||||
Share-based Compensation Arrangement by Share-based Payment Award, Maximum Employee Subscription Rate | 15.00% | 15.00% | ||||
Share-based Compensation Arrangement by Share-based Payment Award, Maximum Employee Subscription | $25,000 | $25,000 | ||||
ShareBasedCompensationArrangementByShareBasedPaymentAwardPercentOfOfferingDatePricePaid | 85.00% | |||||
Share-based Compensation Arrangement by Share-based Payment Award, Number of Shares Available for Grant | 1,300,000 | 1,300,000 | ||||
Stock Issued During Period, Shares, Employee Stock Purchase Plans | 44,437 | 37,124 | ||||
[1] | (1)B The number of awards assumes a one multiplier. The final number of shares of common stock issued may vary depending on the three-year performance multiplier, which ranges from zero to two. |
Compensation_Plans_Non_Stockba
Compensation Plans Non Stock-based Compensation (Details) (USD $) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | |
Cash Bonus Plan [Member] | ||||
Cash Paid in Current Period for Bonus Compensation | $16,000,000 | $24,000,000 | ||
Accrued Cash Bonus Plan Expense | 5,800,000 | 4,300,000 | 16,700,000 | 13,600,000 |
Net Profits Plan [Member] | ||||
Cash Payments Made or Accrued under Profit Sharing Plan Related to Divested Property | 274,000 | 2,600,000 | 1,990,202 | |
General and administrative expense | 4,302,000 | 4,083,000 | 11,531,000 | 12,177,000 |
Exploration expense | 329,000 | 403,000 | 1,026,000 | 1,421,000 |
Total | $4,631,000 | $4,486,000 | $12,557,000 | $13,598,000 |
Pension_Benefits_Details
Pension Benefits (Details) (USD $) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | |
Components of Net Periodic Benefit Costs for Both Pension Plans | ||||
Service cost | $1,572,000 | $1,232,000 | $4,718,000 | $3,697,000 |
Interest cost | 407,000 | 345,000 | 1,220,000 | 1,034,000 |
Expected return on plan assets that reduces periodic pension costs | -384,000 | -286,000 | -1,153,000 | -858,000 |
Amortization of prior service costs | 4,000 | 4,000 | 13,000 | 13,000 |
Amortization of net actuarial loss | 306,000 | 197,000 | 917,000 | 591,000 |
Net periodic benefit cost | 1,905,000 | 1,492,000 | 5,715,000 | 4,477,000 |
Percentage in excess of the greater of the benefit obligation or the market-related value of assets, gain and losses amortized (as a percent) | 10.00% | 10.00% | ||
Defined Benefit Plan, Contributions by Employer | 4,300,000 | |||
Required contribution to Qualified Pension Plan for the current fiscal year | $373,000 | $373,000 |
Derivative_Financial_Instrumen2
Derivative Financial Instruments (Details) | Sep. 30, 2013 |
bbl | |
Crude oil | |
Derivative Financial Instruments | |
Portion of future oil and NGL production hedged | 19,800,000 |
Natural Gas | |
Derivative Financial Instruments | |
Portion of Gas Production Being Hedged | 224,400,000 |
Natural Gas Liquids | |
Derivative Financial Instruments | |
Portion of future oil and NGL production hedged | 900,000 |
NYMEX WTI [Member] | |
Derivative Financial Instruments | |
Index percent of oil fixed swap | 93.00% |
Argus LLS [Member] | |
Derivative Financial Instruments | |
Index percent of oil fixed swap | 7.00% |
IF El Paso Permian [Member] | |
Derivative Financial Instruments | |
Index percent of natural gas fixed swaps | 3.00% |
Index percent of natural gas collars | 2.00% |
IF HSC [Member] | |
Derivative Financial Instruments | |
Index percent of natural gas fixed swaps | 72.00% |
Index percent of natural gas collars | 54.00% |
IF NGPL TXOK [Member] | |
Derivative Financial Instruments | |
Index percent of natural gas fixed swaps | 3.00% |
Index percent of natural gas collars | 4.00% |
IF NNG Ventura [Member] | |
Derivative Financial Instruments | |
Index percent of natural gas fixed swaps | 2.00% |
Index percent of natural gas collars | 5.00% |
IF PEPL [Member] | |
Derivative Financial Instruments | |
Index percent of natural gas fixed swaps | 8.00% |
Index percent of natural gas collars | 7.00% |
IF Reliant N/S [Member] | |
Derivative Financial Instruments | |
Index percent of natural gas fixed swaps | 10.00% |
Index percent of natural gas collars | 15.00% |
IF NGPL MidCont [Member] | |
Derivative Financial Instruments | |
Index percent of natural gas fixed swaps | 2.00% |
IF TETCO STX [Member] | |
Derivative Financial Instruments | |
Index percent of natural gas collars | 13.00% |
OPIS Mont. Belvieu Ethane Purity [Member] | |
Derivative Financial Instruments | |
Index percent of NGL fixed swaps | 7.00% |
OPIS Mont. Belvieu LDH Propane [Member] | |
Derivative Financial Instruments | |
Index percent of NGL fixed swaps | 45.00% |
OPIS Mont. Belvieu Non LDH Isobutane [Member] | |
Derivative Financial Instruments | |
Index percent of NGL fixed swaps | 13.00% |
OPIS Mont. Belvieu Non-LDH Normal Butane [Member] | |
Derivative Financial Instruments | |
Index percent of NGL fixed swaps | 16.00% |
OPIS Mont. Belvieu Non-LDH Natural Gasoline [Member] | |
Derivative Financial Instruments | |
Index percent of NGL fixed swaps | 19.00% |
Swap | Crude oil | |
Derivative Financial Instruments | |
Portion of future oil and NGL production hedged | 11,897,000 |
Swap | Natural Gas | |
Derivative Financial Instruments | |
Portion of Gas Production Being Hedged | 202,584,000 |
Swap | Natural Gas Liquids | |
Derivative Financial Instruments | |
Portion of future oil and NGL production hedged | 915,000 |
Collar | Crude oil | |
Derivative Financial Instruments | |
Portion of future oil and NGL production hedged | 7,868,000 |
Collar | Natural Gas | |
Derivative Financial Instruments | |
Portion of Gas Production Being Hedged | 21,854,000 |
Remainder of 2013 [Member] | Swap | Crude oil | |
Derivative Financial Instruments | |
Portion of future oil and NGL production hedged | 1,118,000 |
Weighted-Average Contract Price | 97.09 |
Remainder of 2013 [Member] | Swap | Natural Gas | |
Derivative Financial Instruments | |
Portion of Gas Production Being Hedged | 19,047,000 |
Weighted-Average Contract Price | 4.06 |
Remainder of 2013 [Member] | Swap | Natural Gas Liquids | |
Derivative Financial Instruments | |
Portion of future oil and NGL production hedged | 511,000 |
Weighted-Average Contract Price | 53.16 |
Remainder of 2013 [Member] | Collar | Crude oil | |
Derivative Financial Instruments | |
Portion of future oil and NGL production hedged | 1,480,000 |
Weighted-Average Floor Price | 88.14 |
Weighted-Average Ceiling Price | 114.12 |
Remainder of 2013 [Member] | Collar | Natural Gas | |
Derivative Financial Instruments | |
Portion of Gas Production Being Hedged | 1,640,000 |
Weighted-Average Floor Price | 4.39 |
Weighted-Average Ceiling Price | 5.31 |
2014 [Member] | Swap | Crude oil | |
Derivative Financial Instruments | |
Portion of future oil and NGL production hedged | 5,164,000 |
Weighted-Average Contract Price | 95.25 |
2014 [Member] | Swap | Natural Gas | |
Derivative Financial Instruments | |
Portion of Gas Production Being Hedged | 64,453,000 |
Weighted-Average Contract Price | 4.06 |
2014 [Member] | Swap | Natural Gas Liquids | |
Derivative Financial Instruments | |
Portion of future oil and NGL production hedged | 404,000 |
Weighted-Average Contract Price | 58.42 |
2014 [Member] | Collar | Crude oil | |
Derivative Financial Instruments | |
Portion of future oil and NGL production hedged | 3,022,000 |
Weighted-Average Floor Price | 84.07 |
Weighted-Average Ceiling Price | 105.46 |
2014 [Member] | Collar | Natural Gas | |
Derivative Financial Instruments | |
Portion of Gas Production Being Hedged | 5,734,000 |
Weighted-Average Floor Price | 4.38 |
Weighted-Average Ceiling Price | 5.36 |
2015 [Member] | Swap | Crude oil | |
Derivative Financial Instruments | |
Portion of future oil and NGL production hedged | 2,911,000 |
Weighted-Average Contract Price | 89.06 |
2015 [Member] | Swap | Natural Gas | |
Derivative Financial Instruments | |
Portion of Gas Production Being Hedged | 49,328,000 |
Weighted-Average Contract Price | 4.04 |
2015 [Member] | Collar | Crude oil | |
Derivative Financial Instruments | |
Portion of future oil and NGL production hedged | 3,366,000 |
Weighted-Average Floor Price | 85 |
Weighted-Average Ceiling Price | 94.25 |
2015 [Member] | Collar | Natural Gas | |
Derivative Financial Instruments | |
Portion of Gas Production Being Hedged | 14,480,000 |
Weighted-Average Floor Price | 3.96 |
Weighted-Average Ceiling Price | 4.3 |
2016 [Member] | Swap | Crude oil | |
Derivative Financial Instruments | |
Portion of future oil and NGL production hedged | 2,704,000 |
Weighted-Average Contract Price | 85.19 |
2016 [Member] | Swap | Natural Gas | |
Derivative Financial Instruments | |
Portion of Gas Production Being Hedged | 36,126,000 |
Weighted-Average Contract Price | 4.18 |
2017 [Member] | Swap | Natural Gas | |
Derivative Financial Instruments | |
Portion of Gas Production Being Hedged | 23,430,000 |
Weighted-Average Contract Price | 4.21 |
2018 [Member] | Swap | Natural Gas | |
Derivative Financial Instruments | |
Portion of Gas Production Being Hedged | 10,200,000 |
Weighted-Average Contract Price | 4.31 |
Derivative_Financial_Instrumen3
Derivative Financial Instruments Fair Value (Details) (USD $) | Sep. 30, 2013 | Dec. 31, 2012 | Sep. 30, 2012 |
Fair value of derivative assets and liabilities | |||
Derivative asset | $43,305,000 | $37,873,000 | |
Derivative asset | 28,659,000 | 16,466,000 | |
Derivative liability | 22,648,000 | 8,999,000 | |
Derivatives liability | 6,873,000 | 6,645,000 | |
Derivative Asset, Fair Value, Amount Offset Against Collateral | 71,964,000 | 54,339,000 | |
Derivative Asset, Fair Value, Amount Not Offset Against Collateral | -29,225,000 | -13,400,000 | |
Derivative Asset, Fair Value, Amount Offset Against Collateral, Net | 42,739,000 | 40,939,000 | |
Derivative Liability, Fair Value, Amount Offset Against Collateral | -29,521,000 | -15,644,000 | |
Derivative Liability, Fair Value, Amount Not Offset Against Collateral | 29,225,000 | 13,400,000 | |
Derivative Liability, Fair Value, Amount Offset Against Collateral, Net | -296,000 | -2,244,000 | |
Fair value of oil, natural gas, NGL commodity derivative markets | 42,400,000 | 38,700,000 | |
Derivatives not designated as hedging instruments | |||
Fair value of derivative assets and liabilities | |||
Derivative asset | 43,305,000 | 37,873,000 | |
Derivative asset | 28,659,000 | 16,466,000 | |
Derivative liability | 22,648,000 | 8,999,000 | |
Derivatives liability | 6,873,000 | 6,645,000 | |
Level 2 | Derivatives not designated as hedging instruments | Fair Value, Measurements, Recurring [Member] | |||
Fair value of derivative assets and liabilities | |||
Derivative assets not designated as hedging instruments | 71,964,000 | 54,339,000 | |
Derivative liabilities not designated as hedging instruments | $29,521,000 | $15,644,000 |
Derivative_Financial_Instrumen4
Derivative Financial Instruments Gains and Losses (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 | ||||
Gain and loss from derivative cash settlements and changes in fair value of derivative contracts | ||||||||
Derivative cash settlement gain | ($1,288) | [1] | $10,921 | [1] | ($12,715) | [1] | ($32,803) | [1] |
Derivative (gain) loss | 39,933 | [2] | 55,856 | [2] | -14,685 | [2] | -40,040 | [2] |
Amount of (gain) loss reclassified from AOCL to realized hedge gain (loss) | 308 | -315 | 1,115 | -1,465 | ||||
Realized hedge gain (loss) | -489 | 501 | -1,777 | 2,338 | ||||
Crude oil | ||||||||
Gain and loss from derivative cash settlements and changes in fair value of derivative contracts | ||||||||
Derivative cash settlement gain | -13,538 | -2,472 | -13,786 | -13,142 | ||||
Derivative (gain) loss | 30,488 | 30,667 | 8,233 | -32,616 | ||||
Natural Gas | ||||||||
Gain and loss from derivative cash settlements and changes in fair value of derivative contracts | ||||||||
Derivative cash settlement gain | 11,019 | 9,031 | 18,752 | 40,495 | ||||
Derivative (gain) loss | -2,264 | 28,231 | -12,462 | 40,464 | ||||
Natural Gas Liquids | ||||||||
Gain and loss from derivative cash settlements and changes in fair value of derivative contracts | ||||||||
Derivative cash settlement gain | 1,231 | 4,362 | 7,749 | 5,450 | ||||
Derivative (gain) loss | $10,421 | $7,879 | $2,259 | ($15,085) | ||||
[1] | (1)B Derivative cash settlement (gain) loss is reported in the derivative cash settlement gain line item on the condensed consolidated statements of cash flows within net cash provided by operating activities. | |||||||
[2] | (2)B Total derivative (gain) loss is reported in the derivative gain line item on the condensed consolidated statements of cash flows within net cash provided by operating activities. |
Fair_Value_Measurements_Detail
Fair Value Measurements (Details) (USD $) | Sep. 30, 2013 | Dec. 31, 2012 | ||
In Thousands, unless otherwise specified | ||||
Assets: | ||||
Proved oil and gas properties | $5,414,842 | $5,401,684 | ||
Unproved oil and gas properties | 263,662 | 175,287 | ||
Oil and gas properties held for sale net of accumulated depletion, depreciation and amortization of $539,769 in 2013 and 20,676 in 2012 | 400,393 | 33,620 | ||
Liabilities: | ||||
Asset Retirement Obligations, Noncurrent | 101,650 | 112,912 | ||
Fair Value, Measurements, Nonrecurring [Member] | Level 1 | ||||
Assets: | ||||
Proved oil and gas properties | 0 | [1] | 0 | [1] |
Unproved oil and gas properties | 0 | [1] | 0 | [1] |
Oil and gas properties held for sale net of accumulated depletion, depreciation and amortization of $539,769 in 2013 and 20,676 in 2012 | 0 | [1] | 0 | [1] |
Liabilities: | ||||
Asset Retirement Obligations, Noncurrent | 0 | [1] | ||
Fair Value, Measurements, Nonrecurring [Member] | Level 2 | ||||
Assets: | ||||
Proved oil and gas properties | 0 | [1] | 0 | [1] |
Unproved oil and gas properties | 0 | [1] | 0 | [1] |
Oil and gas properties held for sale net of accumulated depletion, depreciation and amortization of $539,769 in 2013 and 20,676 in 2012 | 0 | [1] | 0 | [1] |
Liabilities: | ||||
Asset Retirement Obligations, Noncurrent | 0 | [1] | ||
Fair Value, Measurements, Nonrecurring [Member] | Level 3 | ||||
Assets: | ||||
Proved oil and gas properties | 11,443 | [1] | 209,959 | [1] |
Unproved oil and gas properties | 20,915 | [1] | 42,765 | [1] |
Oil and gas properties held for sale net of accumulated depletion, depreciation and amortization of $539,769 in 2013 and 20,676 in 2012 | 15,349 | [1] | 16,527 | [1] |
Liabilities: | ||||
Asset Retirement Obligations, Noncurrent | 1,573 | [1] | ||
Fair Value, Measurements, Recurring [Member] | Level 1 | ||||
Liabilities: | ||||
Net Profits Plan Liability | 0 | [2] | 0 | [2] |
Fair Value, Measurements, Recurring [Member] | Level 2 | ||||
Liabilities: | ||||
Net Profits Plan Liability | 0 | [2] | 0 | [2] |
Fair Value, Measurements, Recurring [Member] | Level 3 | ||||
Liabilities: | ||||
Net Profits Plan Liability | 72,404 | [2] | 78,827 | [2] |
Derivatives not designated as hedging instruments | Fair Value, Measurements, Recurring [Member] | Level 1 | ||||
Assets: | ||||
Derivatives | 0 | [2] | 0 | [2] |
Liabilities: | ||||
Derivatives | 0 | [2] | 0 | [2] |
Derivatives not designated as hedging instruments | Fair Value, Measurements, Recurring [Member] | Level 2 | ||||
Assets: | ||||
Derivatives | 71,964 | [2] | 54,339 | [2] |
Liabilities: | ||||
Derivatives | 29,521 | [2] | 15,644 | [2] |
Derivatives not designated as hedging instruments | Fair Value, Measurements, Recurring [Member] | Level 3 | ||||
Assets: | ||||
Derivatives | 0 | [2] | 0 | [2] |
Liabilities: | ||||
Derivatives | $0 | [2] | $0 | [2] |
[1] | This represents a non-financial asset or liability that is measured at fair value on a nonrecurring basis. | |||
[2] | This represents a financial asset or liability that is measured at fair value on a recurring basis. |
Fair_Value_Measurements_Fair_V1
Fair Value Measurements Fair Value Measurement (Details 2) (USD $) | 9 Months Ended | |||||||||||
Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Dec. 31, 2012 | Sep. 30, 2013 | Dec. 31, 2012 | Sep. 30, 2013 | Dec. 31, 2012 | Sep. 30, 2013 | |||
Net Profit Plan liability [Member] | Net Profits Plan [Member] | 6.625% Senior Notes Due 2019 [Member] | 6.625% Senior Notes Due 2019 [Member] | 6.50% Senior Notes Due 2021 [Member] | 6.50% Senior Notes Due 2021 [Member] | 6.50% Senior Notes Due 2023 [Member] | 6.50% Senior Notes Due 2023 [Member] | 5.0% Senior Notes Due 2024 [Member] | ||||
Liabiliity measured at fair value using Level 3 inputs | ||||||||||||
Long-term Debt, Fair Value | $368,375,000 | $371,875,000 | $374,500,000 | $371,070,000 | $408,000,000 | $424,200,000 | $461,565,000 | [1] | ||||
Net Profits Plan | ||||||||||||
Discount Rate Used to Calculate Currently in Payout Liabilities | 12.00% | |||||||||||
Discount Rate Used to Calculate Not Currently in Payout Liabilities | 15.00% | |||||||||||
Period Used for Price Assumptions of Strip Prices of Liabilities | 1 | |||||||||||
Percent Change in Commodity Prices for Sensitivity Analysis | 5.00% | |||||||||||
Sensitivity Analysis Change in Liability, Due to Change in Commodity Prices | 6,000,000 | |||||||||||
Percent Change in Discount Rate for Sensitivity Analysis | 1.00% | |||||||||||
Sensitivity Analysis Decrease in Liability Due to Change in Discount Rate | 3,000,000 | |||||||||||
Cash Payments Made or Accrued under Profit Sharing Plan Related to Divested Property | 2,600,000 | |||||||||||
Fair Value, Assets and Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Abstract] | ||||||||||||
Beginning balance | 78,827,000 | |||||||||||
Net increase in liability | 8,736,000 | [2] | ||||||||||
Net settlements | -15,159,000 | [2],[3] | ||||||||||
Transfers in (out) of Level 3 | 0 | |||||||||||
Ending balance | $72,404,000 | |||||||||||
Proved Oil and Gas Properties | ||||||||||||
Discount Rate Used for Fair Value of Oil and Gas Properties | 12.00% | |||||||||||
Period of New York Mercantile Exchange Strip Pricing Used for Price Forecast | 5 | 5 | ||||||||||
[1] | The 2024 Notes were issued on MayB 20, 2013. | |||||||||||
[2] | Net changes in the Companybs Net Profits Plan liability are shown in the Change in Net Profits Plan liability line item of the accompanying statements of operations | |||||||||||
[3] | Settlements represent cash payments made or accrued under the Net Profits Plan. The Company accrued or made cash payments under the Net Profits Plan of $2.6 million relating to divestiture proceeds for the nine months ended SeptemberB 30, 2013 |