Document_and_Entity_Informatio
Document and Entity Information Document | 3 Months Ended | |
Mar. 31, 2014 | Apr. 23, 2014 | |
Entity Information [Line Items] | ' | ' |
Entity Registrant Name | 'SM Energy Co | ' |
Entity Central Index Key | '0000893538 | ' |
Current Fiscal Year End Date | '--12-31 | ' |
Entity Filer Category | 'Large Accelerated Filer | ' |
Document Type | '10-Q | ' |
Document Period End Date | 31-Mar-14 | ' |
Document Fiscal Year Focus | '2014 | ' |
Document Fiscal Period Focus | 'Q1 | ' |
Amendment Flag | 'false | ' |
Entity Common Stock, Shares Outstanding | ' | 67,058,145 |
Entity Current Reporting Status | 'Yes | ' |
CONDENSED_CONSOLIDATED_BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS (UNAUDITED) (in thousands, except share amounts) (USD $) | Mar. 31, 2014 | Dec. 31, 2013 |
In Thousands, unless otherwise specified | ||
Assets | ' | ' |
Cash and cash equivalents | $236,435 | $282,248 |
Accounts receivable | 307,784 | 318,371 |
Derivative asset | 7,450 | 21,559 |
Deferred income taxes | 11,227 | 10,749 |
Prepaid expense and other | 14,446 | 14,574 |
Total current assets | 577,342 | 647,501 |
Proved oil and gas properties | 5,875,541 | 5,637,462 |
Less - accumulated depletion, depreciation, and amortization | -2,722,287 | -2,583,698 |
Unproved oil and gas properties | 287,607 | 271,100 |
Wells in progress | 277,879 | 279,654 |
Oil and gas properties held for sale net of accumulated depletion, depreciation and amortization of $31,776 in 2014 and $7,390 in 2013 | 42,276 | 19,072 |
Other property and equipment, net of accumulated depreciation of $31,013 in 2014 and $28,775 in 2013 | 243,680 | 236,202 |
Total property and equipment, net | 4,004,696 | 3,859,792 |
Derivative asset | 13,886 | 30,951 |
Restricted cash | 23,753 | 96,713 |
Other noncurrent assets | 69,334 | 70,208 |
Total other noncurrent assets | 106,973 | 197,872 |
Total Assets | 4,689,011 | 4,705,165 |
Liabilities | ' | ' |
Accounts payable and accrued expenses | 443,395 | 606,751 |
Derivative liability | 60,684 | 26,380 |
Other current liabilities | 11,200 | 6,000 |
Total current liabilities | 515,279 | 639,131 |
Revolving credit facility | 0 | 0 |
Senior Notes (note 5) | 1,600,000 | 1,600,000 |
Asset retirement obligation | 115,889 | 115,659 |
Asset retirement obligation associated with oil and gas properties held for sale | 4,526 | 3,033 |
Net Profits Plan liability | 55,209 | 56,985 |
Deferred income taxes | 688,994 | 650,125 |
Derivatives liability | 7,885 | 4,640 |
Other noncurrent liabilities | 25,810 | 28,771 |
Total noncurrent liabilities | 2,498,313 | 2,459,213 |
Commitments and contingencies (note 6) | ' | ' |
Stockholders' equity: | ' | ' |
Common stock, $0.01 par value - authorized: 200,000,000 shares; issued: 67,078,853 shares in 2014 and 67,078,853 shares in 2013; outstanding, net of treasury shares: 67,056,441 shares in 2014 and 67,056,441 shares in 2013 | 671 | 671 |
Additional paid-in-capital | 264,064 | 257,720 |
Treasury stock, at cost: 22,412 shares in 2014 and 22,412 in 2013 | -823 | -823 |
Retained earnings | 1,416,923 | 1,354,669 |
Accumulated other comprehensive loss | -5,416 | -5,416 |
Total stockholders' equity | 1,675,419 | 1,606,821 |
Total Liabilities and Stockholders' Equity | $4,689,011 | $4,705,165 |
Balance_Sheet_Parenthetical_Pa
Balance Sheet Parenthetical (Parentheticals) (USD $) | Mar. 31, 2014 | Dec. 31, 2013 |
In Thousands, except Share data, unless otherwise specified | ||
Oil and Gas Property, Successful Effort Method, Accumulated Depreciation, Depletion and Amortization | $2,722,287 | $2,583,698 |
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 | 67,078,853 | 67,078,853 |
Common Stock, Shares, Outstanding | 67,056,441 | 67,056,441 |
Treasury Stock, Shares | 22,412 | 22,412 |
Assets Held-for-sale [Member] | ' | ' |
Oil and Gas Property, Successful Effort Method, Accumulated Depreciation, Depletion and Amortization | 31,776 | 7,390 |
Other Capitalized Property Plant and Equipment [Member] | ' | ' |
Oil and Gas Property, Successful Effort Method, Accumulated Depreciation, Depletion and Amortization | $31,013 | $28,775 |
CONDENSED_CONSOLIDATED_STATEME
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED) (in thousands, except per share amounts) (USD $) | 3 Months Ended | |||
In Thousands, except Per Share data, unless otherwise specified | Mar. 31, 2014 | Mar. 31, 2013 | ||
Operating revenues: | ' | ' | ||
Oil, gas, and NGL production revenue | $623,109 | $469,575 | ||
Other operating revenues | 9,611 | 14,605 | ||
Total operating revenues | 632,720 | 484,180 | ||
Operating expenses: | ' | ' | ||
Oil, gas, and NGL production expense | 163,709 | 125,633 | ||
Depletion, depreciation, amortization, and asset retirement obligation liability accretion | 177,215 | 198,709 | ||
Exploration | 21,335 | 15,398 | ||
Impairment of properties | 2,801 | 21,521 | ||
General and administrative | 35,051 | 32,280 | ||
Change in Net Profits Plan liability | -1,776 | -1,925 | ||
Derivative loss | -97,662 | [1] | -30,572 | [1] |
Other operating expense | 8,089 | 15,794 | ||
Total operating expenses | 504,086 | 437,982 | ||
Income from operations | 128,634 | 46,198 | ||
Non-operating income (expense) | ' | ' | ||
Interest income | 26 | 12 | ||
Interest expense | -24,190 | -19,101 | ||
Income before income taxes | 104,470 | 27,109 | ||
Income tax expense | -38,863 | -10,382 | ||
Net income | $65,607 | $16,727 | ||
Basic weighted-average common shares outstanding | 67,056 | 66,211 | ||
Diluted weighted-average common shares outstanding | 68,126 | 67,521 | ||
Basic net income per common share | $0.98 | $0.25 | ||
Diluted net income per common share | $0.96 | $0.25 | ||
Dividends per common share | $0.05 | $0.05 | ||
[1] | (2)B Total derivative loss is reported in the derivative loss line item on the condensed consolidated statements of cash flows within cash provided by operating activities. |
CONDENSED_CONSOLIDATED_STATEME1
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) (USD $) | 3 Months Ended | |||
In Thousands, unless otherwise specified | Mar. 31, 2014 | Mar. 31, 2013 | ||
Statement of Comprehensive Income [Abstract] | ' | ' | ||
Net income | $65,607 | $16,727 | ||
Reclassification to earnings | 0 | [1] | 61 | [1] |
Pension liability adjustment | 0 | -3 | ||
Total other comprehensive income, net of tax | 0 | 58 | ||
Total comprehensive income | $65,607 | $16,785 | ||
[1] | Reclassification from accumulated other comprehensive income (loss) (bAOCILb) related to de-designated hedges. As of December 31, 2013, all commodity derivative contracts that had been designated as cash flow hedges were settled and reclassified into earnings from AOCIL. |
CONDENSED_CONSOLIDATED_STATEME2
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (USD $) | 3 Months Ended | |||
In Thousands, unless otherwise specified | Mar. 31, 2014 | Mar. 31, 2013 | ||
Statement of Cash Flows [Abstract] | ' | ' | ||
Net income | $65,607 | $16,727 | ||
Adjustments to reconcile net income to net cash provided by operating activities: | ' | ' | ||
(Gain) loss on divestiture activity | 2,958 | -574 | ||
Depletion, depreciation, amortization, and asset retirement obligation liability accretion | 177,215 | 198,709 | ||
Exploratory dry hole expense | 0 | 159 | ||
Impairment of properties | 2,801 | 21,521 | ||
Stock-based compensation expense | 6,344 | 8,113 | ||
Change in Net Profits Plan liability | -1,776 | -1,925 | ||
Derivative loss | 97,662 | [1] | 30,572 | [1] |
Derivative cash settlement (loss) gain | -28,940 | [2] | 11,792 | [2] |
Amortization of debt discount and deferred financing costs | 1,477 | 1,077 | ||
Deferred income taxes | 38,374 | 10,280 | ||
Plugging and abandonment | -1,325 | -1,378 | ||
Other | -3,103 | 1,836 | ||
Changes in current assets and liabilities: | ' | ' | ||
Accounts receivable | 9,347 | -22,164 | ||
Prepaid expenses and other | 885 | 605 | ||
Accounts payable and accrued expenses | -61,882 | 5,794 | ||
Net Cash Provided by Operating Activities | 299,728 | 282,292 | ||
Cash flows from investing activities: | ' | ' | ||
Net proceeds from sale of oil and gas properties | 1,979 | 4,307 | ||
Capital expenditures | -351,739 | -381,185 | ||
Other | 4,227 | -2,025 | ||
Net cash used in investing activities | -345,533 | -378,903 | ||
Cash flows from financing activities: | ' | ' | ||
Proceeds from credit facility | 0 | 223,500 | ||
Repayment of credit facility | 0 | -133,500 | ||
Other | -8 | 772 | ||
Net cash provided by (used in) financing activities | -8 | 90,772 | ||
Net change in cash and cash equivalents | -45,813 | -5,839 | ||
Cash and cash equivalents at beginning of period | 282,248 | 5,926 | ||
Cash and cash equivalents at ending of period | 236,435 | 87 | ||
Supplemental schedule of additional cash flow information and noncash investing and financing activities: | ' | ' | ||
Cash paid for interest, net of capitalized interest | -37,851 | -24,721 | ||
Net cash refunded for income taxes | 14 | 165 | ||
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 $31,776 in 2014 and $7,390 in 2013 | 42,276 | ' | ||
Asset retirement obligation associated with oil and gas properties held for sale | $4,526 | ' | ||
[1] | (2)B Total derivative loss is reported in the derivative loss line item on the condensed consolidated statements of cash flows within cash provided by operating activities. | |||
[2] | (1)B Total derivative cash settlement loss (gain) is reported in the derivative cash settlement (loss) gain line item on the condensed consolidated statements of cash flows within net cash provided by operating activities. |
CONDENSED_CONSOLIDATED_STATEME3
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED) (in thousands) (Parenthetical) (USD $) | 3 Months Ended | |
In Millions, unless otherwise specified | Mar. 31, 2014 | Mar. 31, 2013 |
Statement of Cash Flows [Abstract] | ' | ' |
Dividends, Common Stock | $3.40 | $3.30 |
Capital expenditures incurred but not yet paid | $200.50 | $202.80 |
The_Company_and_Business
The Company and Business | 3 Months Ended |
Mar. 31, 2014 | |
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 | 3 Months Ended |
Mar. 31, 2014 | |
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, 2013 (the “2013 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 March 31, 2014, through the filing date of this report. | |
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 its 2013 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 2013 Form 10-K. | |
Recently Issued Accounting Standards | |
In April 2014, the Financial Accounting Standards Board issued new authoritative accounting guidance related to the recognition and presentation of discontinued operations in the financial statements. The guidance is aimed at reducing the frequency of disposals reported as discontinued operations by focusing on strategic shifts that have or will have a major effect on an entity’s operations and financial results. This authoritative accounting guidance is effective for interim and annual periods beginning after December 15, 2014, and is to be applied prospectively. The Company is currently evaluating the provisions of this authoritative guidance and assessing its impact, but does not currently believe it will have a material effect on the Company's financial statements or disclosures. | |
There are no other new significant accounting standards applicable to the Company that have been issued but not yet adopted by the Company as of March 31, 2014. |
Assets_Held_for_Sale_Assets_He
Assets Held for Sale Assets Held for Sale | 3 Months Ended |
Mar. 31, 2014 | |
Assets held for sale [Abstract] | ' |
Assets Held-for-sale | ' |
Note 3 – Acquisitions, Divestitures, and Assets Held for Sale | |
Acquisitions | |
Subsequent to March 31, 2014, the Company entered into separate agreements to acquire acreage in its Rocky Mountain region for total cash consideration of approximately $100.0 million plus approximately 7,000 net acres. These agreements are expected to close during the second quarter 2014 and are subject to standard closing conditions and normal closing and post-closing adjustments. No assurance can be given that the Company will successfully close any of these acquisitions. | |
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 decreases to the estimated fair value less the costs to sell will impact the measurement of assets held for sale. | |
As of March 31, 2014, the accompanying condensed consolidated balance sheets (“accompanying balance sheets”) present $42.3 million of oil and gas properties held for sale, net of accumulated depletion, depreciation, and amortization expense. A corresponding asset retirement obligation liability of $4.5 million is separately presented. The assets held for sale include the Company’s Marcellus shale assets located in Pennsylvania and other non-strategic assets in the Company’s Rocky Mountain region, all of which are recorded at the lesser of their carrying values or their respective fair value less estimated costs to sell. When write-downs to fair value less estimated costs to sell occur, they are reflected in gain (loss) on divestiture activity, which is included within the other operating revenues line item in the accompanying condensed consolidated statements of operations (“accompanying statements of operations”). | |
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 | 3 Months Ended | |||||||
Mar. 31, 2014 | ||||||||
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 0% to 200% of 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. | ||||||||
The following table sets forth the calculations of basic and diluted earnings per share: | ||||||||
For the Three Months Ended March 31, | ||||||||
2014 | 2013 | |||||||
(in thousands, except per share amounts) | ||||||||
Net income | $ | 65,607 | $ | 16,727 | ||||
Basic weighted-average common shares outstanding | 67,056 | 66,211 | ||||||
Add: dilutive effect of stock options, unvested RSUs, and contingent PSUs | 1,070 | 1,310 | ||||||
Diluted weighted-average common shares outstanding | 68,126 | 67,521 | ||||||
Basic net income per common share | $ | 0.98 | $ | 0.25 | ||||
Diluted net income per common share | $ | 0.96 | $ | 0.25 | ||||
Income_Taxes
Income Taxes | 3 Months Ended | |||||||
Mar. 31, 2014 | ||||||||
Income Tax Disclosure [Abstract] | ' | |||||||
Income Taxes | ' | |||||||
Note 4 - Income Taxes | ||||||||
Income tax expense for the three months ended March 31, 2014, and 2013, differs from the amounts that would be provided by applying the statutory United States federal income tax rate to income before income taxes primarily due to the effect of state income taxes, changes in valuation allowances, percentage depletion, research and development (“R&D”) credits, 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 March 31, | ||||||||
2014 | 2013 | |||||||
(in thousands) | ||||||||
Current portion of income tax expense: | ||||||||
Federal | $ | — | $ | — | ||||
State | 489 | 102 | ||||||
Deferred portion of income tax expense | 38,374 | 10,280 | ||||||
Total income tax expense | $ | 38,863 | $ | 10,382 | ||||
37.2 | % | 38.3 | % | |||||
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. The decrease in the effective rate from 2013 primarily reflects temporary and permanent changes in the mix of highest marginal state tax rates, the effects of valuation allowance adjustments, the state tax rate effect divestitures have between years, drilling activities, and changes in the effects of other 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 tax authorities for years before 2007. Federal tax law allowing for the calculation of an R&D credit was enacted in 2013, which allowed the credit for the 2012 and 2013 tax years. However, the Company has not yet commissioned a study to calculate the credit for these tax years. The table above excludes the impact for any credit that would be allowed in 2013. 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 and is pursuing its appeal. | ||||||||
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 has determined it is materially compliant with the requirements of these regulations. |
LongTerm_Debt
Long-Term Debt | 3 Months Ended | |||||||||||
Mar. 31, 2014 | ||||||||||||
Debt Disclosure [Abstract] | ' | |||||||||||
Long-term debt | ' | |||||||||||
Note 5 - Long-term Debt | ||||||||||||
Revolving Credit Facility | ||||||||||||
The Company’s Fifth Amended and Restated Credit Agreement provides 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 borrowing base is subject to regular semi-annual redeterminations and was re-affirmed on March 28, 2014, at $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 lender group. The next scheduled redetermination date is October 1, 2014. Borrowings under the facility are secured by at least 75 percent 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 March 31, 2014, and through the filing date of this report. | ||||||||||||
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 April 23, 2014, March 31, 2014, and December 31, 2013: | ||||||||||||
As of April 23, 2014 | As of March 31, 2014 | As of December 31, 2013 | ||||||||||
(in thousands) | ||||||||||||
Credit facility balance | $ | — | $ | — | $ | — | ||||||
Letters of credit (1) | $ | 808 | $ | 808 | $ | 808 | ||||||
Available borrowing capacity | $ | 1,299,192 | $ | 1,299,192 | $ | 1,299,192 | ||||||
____________________________________________ | ||||||||||||
(1) Letters of credit reduce the available borrowing capacity under the credit facility on a dollar-for-dollar basis. | ||||||||||||
Senior Notes | ||||||||||||
The Senior Notes line on the accompanying balance sheets represents the outstanding principal amount 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 5.0% Senior Notes due 2024 (the “2024 Notes” and collectively with the 2019 Notes, 2021 Notes, and 2023 Notes, the “Senior Notes”), as shown in the table below: | ||||||||||||
As of March 31, 2014 | As of December 31, 2013 | |||||||||||
(in thousands) | ||||||||||||
2019 Notes | $ | 350,000 | $ | 350,000 | ||||||||
2021 Notes | 350,000 | 350,000 | ||||||||||
2023 Notes | 400,000 | 400,000 | ||||||||||
2024 Notes | 500,000 | 500,000 | ||||||||||
Total Senior Notes | $ | 1,600,000 | $ | 1,600,000 | ||||||||
The Senior 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 Senior Notes. The Company is subject to certain covenants under the respective indentures governing the Senior 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 Senior Notes as of March 31, 2014, and through the filing date of this report. | ||||||||||||
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. Please refer to Note 5 - Long-term Debt in the Company’s 2013 Form 10-K for additional discussion of the terms of these notes. | ||||||||||||
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 filed an exchange offer registration statement with the Securities and Exchange Commission (“SEC”) on March 4, 2014, offering to exchange the 2024 Notes for substantially identical notes that are registered under the Securities Act. If the registration statement is not declared effective by the SEC 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 | 3 Months Ended |
Mar. 31, 2014 | |
Commitments and Contingencies Disclosure [Abstract] | ' |
Commitments and Contingencies | ' |
Note 6 - Commitments and Contingencies | |
Commitments | |
During the first quarter of 2014, and through the filing date of this report, the Company entered into drilling rig contracts with varying terms extending through 2016. The total commitments for these contracts is $52.7 million. | |
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 both 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 April 16, 2014, the Company agreed to settle its previously disclosed litigation against Endeavour Operating Corporation (“Endeavour”). The Company, its working interest partners, and Endeavour agreed to release all claims and dismiss the lawsuit in exchange for certain cash payments and other consideration paid to the Company and its working interest partners by Endeavour. | |
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 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 discovery yet to be completed, 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. On December 30, 2013, the Company sold a substantial portion of the assets that are subject to this matter and the buyer assumed any such liabilities related to such properties. |
Compensation_Plans
Compensation Plans | 3 Months Ended | |||||||
Mar. 31, 2014 | ||||||||
Compensation Related Costs [Abstract] | ' | |||||||
Compensation Plans | ' | |||||||
Note 7 - Compensation Plans | ||||||||
Cash Bonus Plan | ||||||||
During the first quarters of 2014 and 2013, the Company paid $41.7 million and $16.0 million, respectively, for cash bonuses earned during the 2013 and 2012 performance years, respectively. The general and administrative (“G&A”) expense and exploration expense line items in the accompanying statements of operations include $6.6 million and $5.6 million of accrued cash bonus plan expense for the three months ended March 31, 2014, and 2013, respectively, related to the respective performance years. | ||||||||
Non-qualified Deferred Compensation Plan | ||||||||
In January 2014, the Company established a non-qualified deferred compensation (“NQDC”) plan intended to provide plan participants with the ability to plan for income tax events and the opportunity to receive a benefit for matching contributions in excess of Internal Revenue Code (“IRC”) limits applicable to the Company’s 401(k) plan. The NQDC plan is designed to allow participants to defer a portion of base salary and cash bonuses paid pursuant to the Company’s cash bonus plan. Each year, participating employees may elect to defer (i) between 0% and 50% of their base salary, and (ii) between 0% and 100% of the cash bonus paid pursuant to the cash bonus plan. The NQDC plan requires the Company to make contributions for each eligible employee equal to 100% of the deferred amount for such employee, limited to 6% of such employee’s base salary and cash bonus. Each eligible employee’s interest in the contributions the Company makes will vest 40% after the second year of such employee’s service to the Company, and 20% per year thereafter. A participant’s account will be distributed based upon the participant’s payment election made at the time of deferral. A participant may elect to have distributions made in lump sum or in annual installments ranging for a period from 1 to 10 years. Participants in the NQDC plan are currently limited to the Company’s officers and directors. | ||||||||
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 months ended March 31, 2014, and 2013, was $2.8 million and $3.0 million, respectively. As of March 31, 2014, there was $15.9 million of total unrecognized compensation expense related to unvested RSU awards, which is being amortized through 2016. There have been no material changes to the outstanding and non-vested RSUs during the three months ended March 31, 2014. | ||||||||
Performance Stock Units Under the Equity Incentive Compensation Plan | ||||||||
The Company grants performance share units (“PSUs”) as part of its equity compensation program. The number of shares of the Company’s common stock issued to settle PSUs ranges from 0% to 200% of 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 months ended March 31, 2014, and 2013, was $3.2 million and $4.7 million, respectively. As of March 31, 2014, there was $14.9 million of total unrecognized compensation expense related to unvested PSU awards, which is being amortized through 2016. There have been no material changes to the outstanding and non-vested PSUs during the three months ended March 31, 2014. | ||||||||
Stock Option Grants Under the Equity Incentive Compensation Plan | ||||||||
As of March 31, 2014, there were 39,088 stock option awards outstanding at a weighted average exercise price of $20.87 with an aggregate intrinsic value of $2.0 million. There was no unrecognized compensation expense as of March 31, 2014, and no changes in these awards occurred during the quarter. | ||||||||
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 March 31, | ||||||||
2014 | 2013 | |||||||
(in thousands) | ||||||||
General and administrative expense | $ | 2,978 | $ | 3,786 | ||||
Exploration expense | 288 | 374 | ||||||
Total | $ | 3,266 | $ | 4,160 | ||||
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 and 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. 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 | 3 Months Ended | |||||||
Mar. 31, 2014 | ||||||||
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 March 31, | ||||||||
2014 | 2013 | |||||||
(in thousands) | ||||||||
Service cost | $ | 1,573 | $ | 1,232 | ||||
Interest cost | 407 | 345 | ||||||
Expected return on plan assets that reduces periodic pension costs | (385 | ) | (286 | ) | ||||
Amortization of prior service costs | 4 | 4 | ||||||
Amortization of net actuarial loss | 306 | 197 | ||||||
Net periodic benefit cost | $ | 1,905 | $ | 1,492 | ||||
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 | ||||||||
The Company contributed $5.3 million to the Pension Plans during the three month period ended March 31, 2014. |
Derivative_Financial_Instrumen
Derivative Financial Instruments | 3 Months Ended | ||||||||||||||||
Mar. 31, 2014 | |||||||||||||||||
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 March 31, 2014, 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 17.0 million Bbls of oil production, 216.6 million MMBtu of gas production, and 2.9 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 March 31, 2014, and through the filing date of this report: | |||||||||||||||||
Oil Contracts | |||||||||||||||||
Oil Swaps | |||||||||||||||||
Contract Period | NYMEX WTI Volumes | Weighted-Average | |||||||||||||||
Contract Price | |||||||||||||||||
(Bbls) | (per Bbl) | ||||||||||||||||
Second quarter 2014 | 2,373,000 | $ | 94.95 | ||||||||||||||
Third quarter 2014 | 1,533,000 | $ | 96.04 | ||||||||||||||
Fourth quarter 2014 | 1,353,000 | $ | 94.88 | ||||||||||||||
2015 | 3,308,000 | $ | 89.34 | ||||||||||||||
2016 | 2,704,000 | $ | 85.19 | ||||||||||||||
All oil swaps | 11,271,000 | ||||||||||||||||
Oil Collars | |||||||||||||||||
Contract Period | NYMEX WTI | Weighted- | Weighted- | ||||||||||||||
Volumes | Average Floor | Average Ceiling | |||||||||||||||
Price | Price | ||||||||||||||||
(Bbls) | (per Bbl) | (per Bbl) | |||||||||||||||
Second quarter 2014 | 431,000 | $ | 85 | $ | 102.5 | ||||||||||||
Third quarter 2014 | 973,000 | $ | 85 | $ | 102.58 | ||||||||||||
Fourth quarter 2014 | 923,000 | $ | 85 | $ | 102.63 | ||||||||||||
2015 | 3,366,000 | $ | 85 | $ | 94.25 | ||||||||||||
All oil collars | 5,693,000 | ||||||||||||||||
Gas Contracts | |||||||||||||||||
Gas Swaps | |||||||||||||||||
Contract Period | Volumes | Weighted-Average | |||||||||||||||
Contract Price | |||||||||||||||||
(MMBtu) | (per MMBtu) | ||||||||||||||||
Second quarter 2014 | 23,758,000 | $ | 3.98 | ||||||||||||||
Third quarter 2014 | 24,541,000 | $ | 4.02 | ||||||||||||||
Fourth quarter 2014 | 22,014,000 | $ | 4.02 | ||||||||||||||
2015 | 57,943,000 | $ | 4.04 | ||||||||||||||
2016 | 37,472,000 | $ | 4.17 | ||||||||||||||
2017 | 23,430,000 | $ | 4.21 | ||||||||||||||
2018 | 10,200,000 | $ | 4.31 | ||||||||||||||
All gas swaps* | 199,358,000 | ||||||||||||||||
*Gas swaps are comprised of IF El Paso Permian (3%), IF HSC (83%), IF NGPL TXOK (2%), IF NNG Ventura (3%), IF Reliant N/S (8%), and IF CIG N System (1%). | |||||||||||||||||
Gas Collars | |||||||||||||||||
Contract Period | Volumes | Weighted- | Weighted- | ||||||||||||||
Average Floor | Average Ceiling | ||||||||||||||||
Price | Price | ||||||||||||||||
(MMBtu) | (per MMBtu) | (per MMBtu) | |||||||||||||||
Second quarter 2014 | 4,194,000 | $ | 4.38 | $ | 5.29 | ||||||||||||
2015 | 13,002,000 | $ | 3.98 | $ | 4.3 | ||||||||||||
All gas collars* | 17,196,000 | ||||||||||||||||
*Gas collars are comprised of IF El Paso Permian (3%), IF HSC (64%), IF NGPL TXOK (3%), IF NNG Ventura (6%), IF Reliant N/S (16%), and IF TETCO STX (8%). | |||||||||||||||||
NGL Contracts | |||||||||||||||||
NGL Swaps | |||||||||||||||||
Contract Period | Volumes | Weighted-Average | |||||||||||||||
Contract Price | |||||||||||||||||
(Bbls) | (per Bbl) | ||||||||||||||||
Second quarter 2014 | 1,096,000 | $ | 58.04 | ||||||||||||||
Third quarter 2014 | 960,000 | $ | 58.06 | ||||||||||||||
Fourth quarter 2014 | 861,000 | $ | 58.06 | ||||||||||||||
All NGL swaps* | 2,917,000 | ||||||||||||||||
*NGL swaps are comprised of Oil Price Information System (“OPIS”) Mont Belvieu LDH Propane (72%) and OPIS Mont Belvieu NON-LDH Natural Gasoline (28%). | |||||||||||||||||
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 liability of $47.2 million and net asset of $21.5 million at March 31, 2014, and December 31, 2013, respectively. | |||||||||||||||||
The following tables detail the fair value of derivatives recorded in the accompanying balance sheets, by category: | |||||||||||||||||
As of March 31, 2014 | |||||||||||||||||
Derivative Assets | Derivative Liabilities | ||||||||||||||||
Balance Sheet | Fair Value | Balance Sheet | Fair Value | ||||||||||||||
Classification | Classification | ||||||||||||||||
(in thousands) | |||||||||||||||||
Commodity contracts | Current assets | $ | 7,450 | Current liabilities | $ | 60,684 | |||||||||||
Commodity contracts | Noncurrent assets | 13,886 | Noncurrent liabilities | 7,885 | |||||||||||||
Derivatives not designated as hedging instruments | $ | 21,336 | $ | 68,569 | |||||||||||||
As of December 31, 2013 | |||||||||||||||||
Derivative Assets | Derivative Liabilities | ||||||||||||||||
Balance Sheet | Fair Value | Balance Sheet | Fair Value | ||||||||||||||
Classification | Classification | ||||||||||||||||
(in thousands) | |||||||||||||||||
Commodity contracts | Current assets | $ | 21,559 | Current liabilities | $ | 26,380 | |||||||||||
Commodity contracts | Noncurrent assets | 30,951 | Noncurrent liabilities | 4,640 | |||||||||||||
Derivatives not designated as hedging instruments | $ | 52,510 | $ | 31,020 | |||||||||||||
Offsetting of Derivative Assets and Liabilities | |||||||||||||||||
As of March 31, 2014, and December 31, 2013, 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 settlements 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 | March 31, 2014 | December 31, 2013 | March 31, 2014 | December 31, 2013 | |||||||||||||
(in thousands) | |||||||||||||||||
Gross amounts presented in the accompanying balance sheets | $ | 21,336 | $ | 52,510 | $ | (68,569 | ) | $ | (31,020 | ) | |||||||
Amounts not offset in the accompanying balance sheets | (21,336 | ) | (30,652 | ) | 21,336 | 30,652 | |||||||||||
Net amounts | $ | — | $ | 21,858 | $ | (47,233 | ) | $ | (368 | ) | |||||||
The following table summarizes the components of the derivative loss presented in the accompanying statements of operations: | |||||||||||||||||
For the Three Months Ended March 31, | |||||||||||||||||
2014 | 2013 | ||||||||||||||||
(in thousands) | |||||||||||||||||
Derivative cash settlement loss (gain): | |||||||||||||||||
Oil contracts | $ | 6,758 | $ | 277 | |||||||||||||
Gas contracts | 13,404 | (9,824 | ) | ||||||||||||||
NGL contracts | 8,778 | (2,245 | ) | ||||||||||||||
Total derivative cash settlement loss (gain) (1) | 28,940 | (11,792 | ) | ||||||||||||||
Derivative loss (gain): | |||||||||||||||||
Oil contracts | 25,192 | 3,789 | |||||||||||||||
Gas contracts | 46,057 | 40,069 | |||||||||||||||
NGL contracts | (2,527 | ) | (1,494 | ) | |||||||||||||
Total derivative loss (2) | $ | 97,662 | $ | 30,572 | |||||||||||||
____________________________________________ | |||||||||||||||||
(1) | Total derivative cash settlement loss (gain) is reported in the derivative cash settlement (loss) gain line item on the condensed consolidated statements of cash flows within net cash provided by operating activities. | ||||||||||||||||
(2) | Total derivative loss is reported in the derivative loss line item on the condensed consolidated statements of cash flows within cash provided by operating activities. | ||||||||||||||||
Credit Related Contingent Features | |||||||||||||||||
As of March 31, 2014, and through the filing date of this report, all of the Company’s derivative counterparties were members of the Company’s credit facility lender group. The Company’s obligations under its derivative contracts are secured by liens on at least 75 percent of the Company’s proved oil and gas properties. |
Fair_Value_Measurements_Fair_V
Fair Value Measurements Fair Value Measurements | 3 Months Ended | |||||||||||
Mar. 31, 2014 | ||||||||||||
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 March 31, 2014: | ||||||||||||
Level 1 | Level 2 | Level 3 | ||||||||||
(in thousands) | ||||||||||||
Assets: | ||||||||||||
Derivatives (1) | $ | — | $ | 21,336 | $ | — | ||||||
Liabilities: | ||||||||||||
Derivatives (1) | $ | — | $ | 68,569 | $ | — | ||||||
Net Profits Plan (1) | $ | — | $ | — | $ | 55,209 | ||||||
____________________________________________ | ||||||||||||
(1) This represents a financial asset or liability that is measured at fair value on a recurring 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, 2013: | ||||||||||||
Level 1 | Level 2 | Level 3 | ||||||||||
(in thousands) | ||||||||||||
Assets: | ||||||||||||
Derivatives (1) | $ | — | $ | 52,510 | $ | — | ||||||
Proved oil and gas properties (2) | $ | — | $ | — | $ | 62,178 | ||||||
Unproved oil and gas properties (2) | $ | — | $ | — | $ | 3,280 | ||||||
Oil and gas properties held for sale (2) | $ | — | $ | — | $ | 650 | ||||||
Liabilities: | ||||||||||||
Derivatives (1) | $ | — | $ | 31,020 | $ | — | ||||||
Net Profits Plan (1) | $ | — | $ | — | $ | 56,985 | ||||||
____________________________________________ | ||||||||||||
(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 lender group. | ||||||||||||
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 authoritative accounting 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. A discount rate of 12 percent is used to calculate this liability and is 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 March 31, 2014, would differ by approximately $5 million. A one percent increase or decrease in the discount rate would result in a change of approximately $2 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 Three Months Ended March 31, 2014 | ||||||||||||
(in thousands) | ||||||||||||
Beginning balance | $ | 56,985 | ||||||||||
Net increase in liability (1) | 1,707 | |||||||||||
Net settlements (1) (2) | (3,483 | ) | ||||||||||
Transfers in (out) of Level 3 | — | |||||||||||
Ending balance | $ | 55,209 | ||||||||||
____________________________________________ | ||||||||||||
(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 $217,000 relating to divestiture proceeds for the three months ended March 31, 2014. | |||||||||||
Long-term Debt | ||||||||||||
The following table reflects the fair value of 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 March 31, 2014, or December 31, 2013, as they are recorded at historical value. | ||||||||||||
As of March 31, 2014 | As of December 31, 2013 | |||||||||||
(in thousands) | ||||||||||||
2019 Notes | $ | 375,375 | $ | 374,290 | ||||||||
2021 Notes | $ | 376,250 | $ | 373,625 | ||||||||
2023 Notes | $ | 428,760 | $ | 422,000 | ||||||||
2024 Notes | $ | 488,440 | $ | 475,315 | ||||||||
As of March 31, 2014, the Company had no floating-rate debt outstanding. | ||||||||||||
Proved and Unproved 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 March 31, 2014, and December 31, 2013. 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 OPIS Mont Belvieu pricing, 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. | ||||||||||||
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 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 an income valuation technique similar to the Company’s approach in measuring the fair value of proved and unproved properties, as discussed 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 no asset retirement obligations recorded at fair value in the accompanying balance sheets at March 31, 2014, or December 31, 2013. |
Basis_of_Presentation_Signific1
Basis of Presentation, Significant Accounting Policies, and Recently Issued Accounting Standards (Policies) | 3 Months Ended |
Mar. 31, 2014 | |
Accounting Policies [Abstract] | ' |
Non-qualified Deferred Compensation Plan [Policy Text Block] | ' |
Non-qualified Deferred Compensation Plan | |
In January 2014, the Company established a non-qualified deferred compensation (“NQDC”) plan intended to provide plan participants with the ability to plan for income tax events and the opportunity to receive a benefit for matching contributions in excess of Internal Revenue Code (“IRC”) limits applicable to the Company’s 401(k) plan. The NQDC plan is designed to allow participants to defer a portion of base salary and cash bonuses paid pursuant to the Company’s cash bonus plan. Each year, participating employees may elect to defer (i) between 0% and 50% of their base salary, and (ii) between 0% and 100% of the cash bonus paid pursuant to the cash bonus plan. The NQDC plan requires the Company to make contributions for each eligible employee equal to 100% of the deferred amount for such employee, limited to 6% of such employee’s base salary and cash bonus. Each eligible employee’s interest in the contributions the Company makes will vest 40% after the second year of such employee’s service to the Company, and 20% per year thereafter. A participant’s account will be distributed based upon the participant’s payment election made at the time of deferral. A participant may elect to have distributions made in lump sum or in annual installments ranging for a period from 1 to 10 years. | |
Description and terms of the Performance Share Awards | ' |
Performance Stock Units Under the Equity Incentive Compensation Plan | |
The Company grants performance share units (“PSUs”) as part of its equity compensation program. The number of shares of the Company’s common stock issued to settle PSUs ranges from 0% to 200% of 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. | |
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 lender group. | |
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 authoritative accounting 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) | 3 Months Ended | |||||||
Mar. 31, 2014 | ||||||||
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 March 31, | ||||||||
2014 | 2013 | |||||||
(in thousands, except per share amounts) | ||||||||
Net income | $ | 65,607 | $ | 16,727 | ||||
Basic weighted-average common shares outstanding | 67,056 | 66,211 | ||||||
Add: dilutive effect of stock options, unvested RSUs, and contingent PSUs | 1,070 | 1,310 | ||||||
Diluted weighted-average common shares outstanding | 68,126 | 67,521 | ||||||
Basic net income per common share | $ | 0.98 | $ | 0.25 | ||||
Diluted net income per common share | $ | 0.96 | $ | 0.25 | ||||
Income_Taxes_Tables
Income Taxes (Tables) | 3 Months Ended | |||||||
Mar. 31, 2014 | ||||||||
Income Tax Disclosure [Abstract] | ' | |||||||
Schedule of provision for income taxes | ' | |||||||
The provision for income taxes consists of the following: | ||||||||
For the Three Months Ended March 31, | ||||||||
2014 | 2013 | |||||||
(in thousands) | ||||||||
Current portion of income tax expense: | ||||||||
Federal | $ | — | $ | — | ||||
State | 489 | 102 | ||||||
Deferred portion of income tax expense | 38,374 | 10,280 | ||||||
Total income tax expense | $ | 38,863 | $ | 10,382 | ||||
37.2 | % | 38.3 | % | |||||
LongTerm_Debt_Tables
Long-Term Debt (Tables) | 3 Months Ended | |||||||||||
Mar. 31, 2014 | ||||||||||||
Debt Disclosure [Abstract] | ' | |||||||||||
Schedule of Long-Term Debt Principal Outstanding [Table Text Block] | ' | |||||||||||
The Senior Notes line on the accompanying balance sheets represents the outstanding principal amount 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 5.0% Senior Notes due 2024 (the “2024 Notes” and collectively with the 2019 Notes, 2021 Notes, and 2023 Notes, the “Senior Notes”), as shown in the table below: | ||||||||||||
As of March 31, 2014 | As of December 31, 2013 | |||||||||||
(in thousands) | ||||||||||||
2019 Notes | $ | 350,000 | $ | 350,000 | ||||||||
2021 Notes | 350,000 | 350,000 | ||||||||||
2023 Notes | 400,000 | 400,000 | ||||||||||
2024 Notes | 500,000 | 500,000 | ||||||||||
Total Senior Notes | $ | 1,600,000 | $ | 1,600,000 | ||||||||
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 April 23, 2014, March 31, 2014, and December 31, 2013: | ||||||||||||
As of April 23, 2014 | As of March 31, 2014 | As of December 31, 2013 | ||||||||||
(in thousands) | ||||||||||||
Credit facility balance | $ | — | $ | — | $ | — | ||||||
Letters of credit (1) | $ | 808 | $ | 808 | $ | 808 | ||||||
Available borrowing capacity | $ | 1,299,192 | $ | 1,299,192 | $ | 1,299,192 | ||||||
____________________________________________ | ||||||||||||
(1) Letters of credit reduce the available borrowing capacity under the credit facility on a dollar-for-dollar basis. |
Compensation_Plans_Tables
Compensation Plans (Tables) | 3 Months Ended | |||||||
Mar. 31, 2014 | ||||||||
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | ' | |||||||
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 March 31, | ||||||||
2014 | 2013 | |||||||
(in thousands) | ||||||||
General and administrative expense | $ | 2,978 | $ | 3,786 | ||||
Exploration expense | 288 | 374 | ||||||
Total | $ | 3,266 | $ | 4,160 | ||||
Pension_Benefits_Tables
Pension Benefits (Tables) | 3 Months Ended | |||||||
Mar. 31, 2014 | ||||||||
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 March 31, | ||||||||
2014 | 2013 | |||||||
(in thousands) | ||||||||
Service cost | $ | 1,573 | $ | 1,232 | ||||
Interest cost | 407 | 345 | ||||||
Expected return on plan assets that reduces periodic pension costs | (385 | ) | (286 | ) | ||||
Amortization of prior service costs | 4 | 4 | ||||||
Amortization of net actuarial loss | 306 | 197 | ||||||
Net periodic benefit cost | $ | 1,905 | $ | 1,492 | ||||
Derivative_Financial_Instrumen1
Derivative Financial Instruments (Tables) | 3 Months Ended | ||||||||||||||||
Mar. 31, 2014 | |||||||||||||||||
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 March 31, 2014, and through the filing date of this report: | |||||||||||||||||
Oil Contracts | |||||||||||||||||
Oil Swaps | |||||||||||||||||
Contract Period | NYMEX WTI Volumes | Weighted-Average | |||||||||||||||
Contract Price | |||||||||||||||||
(Bbls) | (per Bbl) | ||||||||||||||||
Second quarter 2014 | 2,373,000 | $ | 94.95 | ||||||||||||||
Third quarter 2014 | 1,533,000 | $ | 96.04 | ||||||||||||||
Fourth quarter 2014 | 1,353,000 | $ | 94.88 | ||||||||||||||
2015 | 3,308,000 | $ | 89.34 | ||||||||||||||
2016 | 2,704,000 | $ | 85.19 | ||||||||||||||
All oil swaps | 11,271,000 | ||||||||||||||||
Oil Collars | |||||||||||||||||
Contract Period | NYMEX WTI | Weighted- | Weighted- | ||||||||||||||
Volumes | Average Floor | Average Ceiling | |||||||||||||||
Price | Price | ||||||||||||||||
(Bbls) | (per Bbl) | (per Bbl) | |||||||||||||||
Second quarter 2014 | 431,000 | $ | 85 | $ | 102.5 | ||||||||||||
Third quarter 2014 | 973,000 | $ | 85 | $ | 102.58 | ||||||||||||
Fourth quarter 2014 | 923,000 | $ | 85 | $ | 102.63 | ||||||||||||
2015 | 3,366,000 | $ | 85 | $ | 94.25 | ||||||||||||
All oil collars | 5,693,000 | ||||||||||||||||
Gas Contracts | |||||||||||||||||
Gas Swaps | |||||||||||||||||
Contract Period | Volumes | Weighted-Average | |||||||||||||||
Contract Price | |||||||||||||||||
(MMBtu) | (per MMBtu) | ||||||||||||||||
Second quarter 2014 | 23,758,000 | $ | 3.98 | ||||||||||||||
Third quarter 2014 | 24,541,000 | $ | 4.02 | ||||||||||||||
Fourth quarter 2014 | 22,014,000 | $ | 4.02 | ||||||||||||||
2015 | 57,943,000 | $ | 4.04 | ||||||||||||||
2016 | 37,472,000 | $ | 4.17 | ||||||||||||||
2017 | 23,430,000 | $ | 4.21 | ||||||||||||||
2018 | 10,200,000 | $ | 4.31 | ||||||||||||||
All gas swaps* | 199,358,000 | ||||||||||||||||
*Gas swaps are comprised of IF El Paso Permian (3%), IF HSC (83%), IF NGPL TXOK (2%), IF NNG Ventura (3%), IF Reliant N/S (8%), and IF CIG N System (1%). | |||||||||||||||||
Gas Collars | |||||||||||||||||
Contract Period | Volumes | Weighted- | Weighted- | ||||||||||||||
Average Floor | Average Ceiling | ||||||||||||||||
Price | Price | ||||||||||||||||
(MMBtu) | (per MMBtu) | (per MMBtu) | |||||||||||||||
Second quarter 2014 | 4,194,000 | $ | 4.38 | $ | 5.29 | ||||||||||||
2015 | 13,002,000 | $ | 3.98 | $ | 4.3 | ||||||||||||
All gas collars* | 17,196,000 | ||||||||||||||||
*Gas collars are comprised of IF El Paso Permian (3%), IF HSC (64%), IF NGPL TXOK (3%), IF NNG Ventura (6%), IF Reliant N/S (16%), and IF TETCO STX (8%). | |||||||||||||||||
NGL Contracts | |||||||||||||||||
NGL Swaps | |||||||||||||||||
Contract Period | Volumes | Weighted-Average | |||||||||||||||
Contract Price | |||||||||||||||||
(Bbls) | (per Bbl) | ||||||||||||||||
Second quarter 2014 | 1,096,000 | $ | 58.04 | ||||||||||||||
Third quarter 2014 | 960,000 | $ | 58.06 | ||||||||||||||
Fourth quarter 2014 | 861,000 | $ | 58.06 | ||||||||||||||
All NGL swaps* | 2,917,000 | ||||||||||||||||
*NGL swaps are comprised of Oil Price Information System (“OPIS”) Mont Belvieu LDH Propane (72%) and OPIS Mont Belvieu NON-LDH Natural Gasoline (28%). | |||||||||||||||||
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 March 31, 2014 | |||||||||||||||||
Derivative Assets | Derivative Liabilities | ||||||||||||||||
Balance Sheet | Fair Value | Balance Sheet | Fair Value | ||||||||||||||
Classification | Classification | ||||||||||||||||
(in thousands) | |||||||||||||||||
Commodity contracts | Current assets | $ | 7,450 | Current liabilities | $ | 60,684 | |||||||||||
Commodity contracts | Noncurrent assets | 13,886 | Noncurrent liabilities | 7,885 | |||||||||||||
Derivatives not designated as hedging instruments | $ | 21,336 | $ | 68,569 | |||||||||||||
As of December 31, 2013 | |||||||||||||||||
Derivative Assets | Derivative Liabilities | ||||||||||||||||
Balance Sheet | Fair Value | Balance Sheet | Fair Value | ||||||||||||||
Classification | Classification | ||||||||||||||||
(in thousands) | |||||||||||||||||
Commodity contracts | Current assets | $ | 21,559 | Current liabilities | $ | 26,380 | |||||||||||
Commodity contracts | Noncurrent assets | 30,951 | Noncurrent liabilities | 4,640 | |||||||||||||
Derivatives not designated as hedging instruments | $ | 52,510 | $ | 31,020 | |||||||||||||
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 | March 31, 2014 | December 31, 2013 | March 31, 2014 | December 31, 2013 | |||||||||||||
(in thousands) | |||||||||||||||||
Gross amounts presented in the accompanying balance sheets | $ | 21,336 | $ | 52,510 | $ | (68,569 | ) | $ | (31,020 | ) | |||||||
Amounts not offset in the accompanying balance sheets | (21,336 | ) | (30,652 | ) | 21,336 | 30,652 | |||||||||||
Net amounts | $ | — | $ | 21,858 | $ | (47,233 | ) | $ | (368 | ) | |||||||
Schedule of derivative (gain) loss | ' | ||||||||||||||||
The following table summarizes the components of the derivative loss presented in the accompanying statements of operations: | |||||||||||||||||
For the Three Months Ended March 31, | |||||||||||||||||
2014 | 2013 | ||||||||||||||||
(in thousands) | |||||||||||||||||
Derivative cash settlement loss (gain): | |||||||||||||||||
Oil contracts | $ | 6,758 | $ | 277 | |||||||||||||
Gas contracts | 13,404 | (9,824 | ) | ||||||||||||||
NGL contracts | 8,778 | (2,245 | ) | ||||||||||||||
Total derivative cash settlement loss (gain) (1) | 28,940 | (11,792 | ) | ||||||||||||||
Derivative loss (gain): | |||||||||||||||||
Oil contracts | 25,192 | 3,789 | |||||||||||||||
Gas contracts | 46,057 | 40,069 | |||||||||||||||
NGL contracts | (2,527 | ) | (1,494 | ) | |||||||||||||
Total derivative loss (2) | $ | 97,662 | $ | 30,572 | |||||||||||||
____________________________________________ | |||||||||||||||||
(1) | Total derivative cash settlement loss (gain) is reported in the derivative cash settlement (loss) gain line item on the condensed consolidated statements of cash flows within net cash provided by operating activities. | ||||||||||||||||
(2) | Total derivative loss is reported in the derivative loss line item on the condensed consolidated statements of cash flows within cash provided by operating activities. |
Fair_Value_Measurements_Tables
Fair Value Measurements (Tables) | 3 Months Ended | |||||||||||
Mar. 31, 2014 | ||||||||||||
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 March 31, 2014: | ||||||||||||
Level 1 | Level 2 | Level 3 | ||||||||||
(in thousands) | ||||||||||||
Assets: | ||||||||||||
Derivatives (1) | $ | — | $ | 21,336 | $ | — | ||||||
Liabilities: | ||||||||||||
Derivatives (1) | $ | — | $ | 68,569 | $ | — | ||||||
Net Profits Plan (1) | $ | — | $ | — | $ | 55,209 | ||||||
____________________________________________ | ||||||||||||
(1) This represents a financial asset or liability that is measured at fair value on a recurring 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, 2013: | ||||||||||||
Level 1 | Level 2 | Level 3 | ||||||||||
(in thousands) | ||||||||||||
Assets: | ||||||||||||
Derivatives (1) | $ | — | $ | 52,510 | $ | — | ||||||
Proved oil and gas properties (2) | $ | — | $ | — | $ | 62,178 | ||||||
Unproved oil and gas properties (2) | $ | — | $ | — | $ | 3,280 | ||||||
Oil and gas properties held for sale (2) | $ | — | $ | — | $ | 650 | ||||||
Liabilities: | ||||||||||||
Derivatives (1) | $ | — | $ | 31,020 | $ | — | ||||||
Net Profits Plan (1) | $ | — | $ | — | $ | 56,985 | ||||||
____________________________________________ | ||||||||||||
(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 Three Months Ended March 31, 2014 | ||||||||||||
(in thousands) | ||||||||||||
Beginning balance | $ | 56,985 | ||||||||||
Net increase in liability (1) | 1,707 | |||||||||||
Net settlements (1) (2) | (3,483 | ) | ||||||||||
Transfers in (out) of Level 3 | — | |||||||||||
Ending balance | $ | 55,209 | ||||||||||
____________________________________________ | ||||||||||||
(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 $217,000 relating to divestiture proceeds for the three months ended March 31, 2014. | |||||||||||
Fair Value, by Balance Sheet Grouping [Table Text Block] | ' | |||||||||||
The following table reflects the fair value of 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 March 31, 2014, or December 31, 2013, as they are recorded at historical value. | ||||||||||||
As of March 31, 2014 | As of December 31, 2013 | |||||||||||
(in thousands) | ||||||||||||
2019 Notes | $ | 375,375 | $ | 374,290 | ||||||||
2021 Notes | $ | 376,250 | $ | 373,625 | ||||||||
2023 Notes | $ | 428,760 | $ | 422,000 | ||||||||
2024 Notes | $ | 488,440 | $ | 475,315 | ||||||||
Assets_Held_for_Sale_Details
Assets Held for Sale (Details) (USD $) | 3 Months Ended | ||
Mar. 31, 2014 | Apr. 23, 2014 | Dec. 31, 2013 | |
Assets held for sale [Abstract] | ' | ' | ' |
Cash Consideration to Acquire Unproved Property | ' | $100,000,000 | ' |
Leasehold Acres Consideration to Acquire Unproved Property | ' | 7,000 | ' |
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 $31,776 in 2014 and $7,390 in 2013 | 42,276,000 | ' | 19,072,000 |
Asset retirement obligation associated with oil and gas properties held for sale | $4,526,000 | ' | $3,033,000 |
Earnings_per_Share_Details
Earnings per Share (Details) (USD $) | 3 Months Ended | |
In Thousands, except Per Share data, unless otherwise specified | Mar. 31, 2014 | Mar. 31, 2013 |
Calculation of basic and diluted earnings per share | ' | ' |
Net income | $65,607 | $16,727 |
Basic weighted-average common shares outstanding | 67,056 | 66,211 |
Add: dilutive effect of stock options, unvested RSU's, and contingent PSU's | 1,070 | 1,310 |
Diluted weighted-average common shares outstanding | 68,126 | 67,521 |
Basic net income per common share | $0.98 | $0.25 |
Diluted net income per common share | $0.96 | $0.25 |
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 | ' |
Income_Taxes_Details
Income Taxes (Details) (USD $) | 3 Months Ended | |
In Thousands, unless otherwise specified | Mar. 31, 2014 | Mar. 31, 2013 |
Components of the provision for income taxes | ' | ' |
Federal | $0 | $0 |
State | 489 | 102 |
Deferred portion of income tax expense | 38,374 | 10,280 |
Income tax expense | $38,863 | $10,382 |
Effective tax rate | 37.20% | 38.30% |
Income_Taxes_Narrative_Details
Income Taxes Narrative (Details) (USD $) | 3 Months Ended |
In Millions, unless otherwise specified | Mar. 31, 2014 |
Income Tax Narrative [Abstract] | ' |
IRS Proposed R&D Tax Adjustment | $4.60 |
LongTerm_Debt_Details
Long-Term Debt (Details) (USD $) | Mar. 31, 2014 | Dec. 31, 2013 | Mar. 31, 2014 | Mar. 31, 2014 | 20-May-13 | Mar. 31, 2014 | Mar. 31, 2014 | Dec. 31, 2013 |
Line of Credit [Member] | 5.0% Senior Notes Due 2024 [Member] | 5.0% Senior Notes Due 2024 [Member] | Revolving Credit Facility [Member] | Senior Notes [Member] | Senior Notes [Member] | |||
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 | ' | ' | ' | ' | ' |
Percentage of Proved Oil and Gas Properties Secured for Credit Facility Borrowing | ' | ' | ' | ' | ' | 75.00% | ' | ' |
Line of Credit, Covenant Compliance, Maximum Annual Dividend Payment | ' | ' | 50,000,000 | ' | ' | ' | ' | ' |
Debt Instrument, Covenant Compliance, Dividends Excluded From Computation | ' | ' | ' | 6,500,000 | ' | ' | ' | ' |
Interest rate on notes (as a percent) | ' | ' | ' | ' | 5.00% | ' | ' | ' |
Debt Instrument, Face Amount | ' | ' | ' | ' | 500,000,000 | ' | ' | ' |
6.625% Senior Notes, Due 2019 | ' | ' | ' | ' | ' | ' | 350,000,000 | 350,000,000 |
6.50% Senior Notes, Due 2021 | ' | ' | ' | ' | ' | ' | 350,000,000 | 350,000,000 |
6.50% Senior Notes, Due 2023 | ' | ' | ' | ' | ' | ' | 400,000,000 | 400,000,000 |
5% Senior Notes, Due 2024 | ' | ' | ' | ' | ' | ' | 500,000,000 | 500,000,000 |
Senior Notes | $1,600,000,000 | $1,600,000,000 | ' | ' | ' | ' | $1,600,000,000 | $1,600,000,000 |
LongTerm_Debt_Credit_Facility_
Long-Term Debt Credit Facility Available Borrowing Capacity (Details) (USD $) | Apr. 23, 2014 | Mar. 31, 2014 | Dec. 31, 2013 | |||
In Thousands, unless otherwise specified | ||||||
Credit Facility Available Borrowing Capacity [Abstract] | ' | ' | ' | |||
Revolving credit facility | $0 | $0 | $0 | |||
Letters of Credit Outstanding, Amount | 808 | [1] | 808 | [1] | 808 | [1] |
Line of Credit Facility, Remaining Borrowing Capacity | $1,299,192 | $1,299,192 | $1,299,192 | |||
[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 Narrative (Details) (Drilling Rig Leasing Contracts [Member], USD $) | 3 Months Ended |
In Millions, unless otherwise specified | Mar. 31, 2014 |
Drilling Rig Leasing Contracts [Member] | ' |
Long-term Purchase Commitment [Line Items] | ' |
Long-term Purchase Commitment, Amount | $52.70 |
Compensation_Plans_Details
Compensation Plans (Details) (USD $) | 3 Months Ended | |
Mar. 31, 2014 | Mar. 31, 2013 | |
RSUs, PSUs, and Director's Shares [Abstract] | ' | ' |
Stock-based compensation expense | $6,344,000 | $8,113,000 |
Cash Bonus Plan [Member] | ' | ' |
Compensation plans | ' | ' |
Accrued Cash Bonus Plan Expense | 6,600,000 | 5,600,000 |
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 | 2,800,000 | 3,000,000 |
Unrecognized stock based compensation expense | 15,900,000 | ' |
Performance Shares [Member] | ' | ' |
RSUs, PSUs, and Director's Shares [Abstract] | ' | ' |
Stock-based compensation expense | 3,200,000 | 4,700,000 |
Unrecognized stock based compensation expense | 14,900,000 | ' |
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 | ' |
Share-based Compensation, Awards Other Than Options, Performance Measurement Period | 3 | ' |
Employee Stock Option [Member] | ' | ' |
Stock option activity | ' | ' |
Stock options outstanding at the end of the period (in shares) | 39,088 | ' |
Weighted-Average Exercise Price | ' | ' |
Stock options outstanding at the end of the period (in dollars per share) | $20.87 | ' |
Aggregate Intrinsic Value | ' | ' |
Vested at the end of the period | $1,971,000 | ' |
Compensation_Plans_Non_Stockba
Compensation Plans Non Stock-based Compensation (Details) (USD $) | 3 Months Ended | |
Mar. 31, 2014 | Mar. 31, 2013 | |
Document Period End Date | 31-Mar-14 | ' |
Cash Bonus Plan [Member] | ' | ' |
Cash Paid in Current Period for Bonus Compensation | $41,700,000 | $16,000,000 |
Accrued Cash Bonus Plan Expense | 6,600,000 | 5,600,000 |
Net Profits Plan [Member] | ' | ' |
General and administrative expense | 2,978,000 | 3,786,000 |
Exploration expense | 288,000 | 374,000 |
Total | $3,266,000 | $4,160,000 |
Compensation_Plans_Nonqualifie
Compensation Plans Non-qualified Deferred Compensation Plan (Details) (Non-qualified Deferred Compensation Plan [Member]) | 3 Months Ended |
Mar. 31, 2014 | |
Years | |
Non-qualified Deferred Compensation Plan [Member] | ' |
Deferred Compensation Arrangement with Individual, Excluding Share-based Payments and Postretirement Benefits [Line Items] | ' |
Base Salary Minimum Deferral Percentage | 0.00% |
Base Salary Maximum Deferral Percentage | 50.00% |
Cash Bonus Minimum Deferral Percentage | 0.00% |
Cash Bonus Maximum Deferral Percentage | 100.00% |
Company Percentage Contribution of Employee Deferred Amount | 100.00% |
Company Percentage Contribution Limit of Employee Deferred Amount | 6.00% |
Employee Vesting Percentage in Company Contribution After Two Years | 40.00% |
Employee Vesting Percentage in Company Contribution Year Three and Each Year Thereafter | 20.00% |
Distribution Option Minimum Years | 1 |
Distribution Option Maximum Years | 10 |
Pension_Benefits_Details
Pension Benefits (Details) (USD $) | 3 Months Ended | |
Mar. 31, 2014 | Mar. 31, 2013 | |
Components of Net Periodic Benefit Costs for Both Pension Plans | ' | ' |
Service cost | $1,573,000 | $1,232,000 |
Interest cost | 407,000 | 345,000 |
Expected return on plan assets that reduces periodic pension costs | -385,000 | -286,000 |
Amortization of prior service costs | 4,000 | 4,000 |
Amortization of net actuarial loss | 306,000 | 197,000 |
Net periodic benefit cost | 1,905,000 | 1,492,000 |
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% | ' |
Defined Benefit Plan, Contributions by Employer | $5,300,000 | ' |
Derivative_Financial_Instrumen2
Derivative Financial Instruments (Details) | 3 Months Ended |
Mar. 31, 2014 | |
Crude oil | ' |
Derivative Financial Instruments | ' |
Portion of future oil and NGL production hedged | 17,000,000 |
Natural Gas | ' |
Derivative Financial Instruments | ' |
Portion of Gas Production Being Hedged | 216,600,000 |
Natural Gas Liquids | ' |
Derivative Financial Instruments | ' |
Portion of future oil and NGL production hedged | 2,900,000 |
IF El Paso Permian [Member] | ' |
Derivative Financial Instruments | ' |
Index percent of natural gas fixed swaps | 3.00% |
Index percent of natural gas collars | 3.00% |
IF HSC [Member] | ' |
Derivative Financial Instruments | ' |
Index percent of natural gas fixed swaps | 83.00% |
Index percent of natural gas collars | 64.00% |
IF NGPL TXOK [Member] | ' |
Derivative Financial Instruments | ' |
Index percent of natural gas fixed swaps | 2.00% |
Index percent of natural gas collars | 3.00% |
IF NNG Ventura [Member] | ' |
Derivative Financial Instruments | ' |
Index percent of natural gas fixed swaps | 3.00% |
Index percent of natural gas collars | 6.00% |
IF Reliant N/S [Member] | ' |
Derivative Financial Instruments | ' |
Index percent of natural gas fixed swaps | 8.00% |
Index percent of natural gas collars | 16.00% |
IF NGPL MidCont [Member] | ' |
Derivative Financial Instruments | ' |
Index percent of natural gas fixed swaps | 1.00% |
IF TETCO STX [Member] | ' |
Derivative Financial Instruments | ' |
Index percent of natural gas collars | 8.00% |
OPIS Mont. Belvieu LDH Propane [Member] | ' |
Derivative Financial Instruments | ' |
Index percent of NGL fixed swaps | 72.00% |
OPIS Mont. Belvieu Non-LDH Natural Gasoline [Member] | ' |
Derivative Financial Instruments | ' |
Index percent of NGL fixed swaps | 28.00% |
Swap | Crude oil | ' |
Derivative Financial Instruments | ' |
Portion of future oil and NGL production hedged | 11,271,000 |
Swap | Natural Gas | ' |
Derivative Financial Instruments | ' |
Portion of Gas Production Being Hedged | 199,358,000 |
Swap | Natural Gas Liquids | ' |
Derivative Financial Instruments | ' |
Portion of future oil and NGL production hedged | 2,917,000 |
Collar | Crude oil | ' |
Derivative Financial Instruments | ' |
Portion of future oil and NGL production hedged | 5,693,000 |
Collar | Natural Gas | ' |
Derivative Financial Instruments | ' |
Portion of Gas Production Being Hedged | 17,196,000 |
Second Quarter Current Year [Member] | Swap | Crude oil | ' |
Derivative Financial Instruments | ' |
Portion of future oil and NGL production hedged | 2,373,000 |
Weighted-Average Contract Price | 94.95 |
Second Quarter Current Year [Member] | Swap | Natural Gas | ' |
Derivative Financial Instruments | ' |
Portion of Gas Production Being Hedged | 23,758,000 |
Weighted-Average Contract Price | 3.98 |
Second Quarter Current Year [Member] | Swap | Natural Gas Liquids | ' |
Derivative Financial Instruments | ' |
Portion of future oil and NGL production hedged | 1,096,000 |
Weighted-Average Contract Price | 58.04 |
Second Quarter Current Year [Member] | Collar | Crude oil | ' |
Derivative Financial Instruments | ' |
Portion of future oil and NGL production hedged | 431,000 |
Weighted-Average Floor Price | 85 |
Weighted-Average Ceiling Price | 102.5 |
Second Quarter Current Year [Member] | Collar | Natural Gas | ' |
Derivative Financial Instruments | ' |
Portion of Gas Production Being Hedged | 4,194,000 |
Weighted-Average Floor Price | 4.38 |
Weighted-Average Ceiling Price | 5.29 |
Third Quarter Current Year [Member] | Swap | Crude oil | ' |
Derivative Financial Instruments | ' |
Portion of future oil and NGL production hedged | 1,533,000 |
Weighted-Average Contract Price | 96.04 |
Third Quarter Current Year [Member] | Swap | Natural Gas | ' |
Derivative Financial Instruments | ' |
Portion of Gas Production Being Hedged | 24,541,000 |
Weighted-Average Contract Price | 4.02 |
Third Quarter Current Year [Member] | Swap | Natural Gas Liquids | ' |
Derivative Financial Instruments | ' |
Portion of future oil and NGL production hedged | 960,000 |
Weighted-Average Contract Price | 58.06 |
Third Quarter Current Year [Member] | Collar | Crude oil | ' |
Derivative Financial Instruments | ' |
Portion of future oil and NGL production hedged | 973,000 |
Weighted-Average Floor Price | 85 |
Weighted-Average Ceiling Price | 102.58 |
Fourth Quarter Current Year [Member] | Swap | Crude oil | ' |
Derivative Financial Instruments | ' |
Portion of future oil and NGL production hedged | 1,353,000 |
Weighted-Average Contract Price | 94.88 |
Fourth Quarter Current Year [Member] | Swap | Natural Gas | ' |
Derivative Financial Instruments | ' |
Portion of Gas Production Being Hedged | 22,014,000 |
Weighted-Average Contract Price | 4.02 |
Fourth Quarter Current Year [Member] | Swap | Natural Gas Liquids | ' |
Derivative Financial Instruments | ' |
Portion of future oil and NGL production hedged | 861,000 |
Weighted-Average Contract Price | 58.06 |
Fourth Quarter Current Year [Member] | Collar | Crude oil | ' |
Derivative Financial Instruments | ' |
Portion of future oil and NGL production hedged | 923,000 |
Weighted-Average Floor Price | 85 |
Weighted-Average Ceiling Price | 102.63 |
2015 [Member] | Swap | Crude oil | ' |
Derivative Financial Instruments | ' |
Portion of future oil and NGL production hedged | 3,308,000 |
Weighted-Average Contract Price | 89.34 |
2015 [Member] | Swap | Natural Gas | ' |
Derivative Financial Instruments | ' |
Portion of Gas Production Being Hedged | 57,943,000 |
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 | 13,002,000 |
Weighted-Average Floor Price | 3.98 |
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 | 37,472,000 |
Weighted-Average Contract Price | 4.17 |
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 |
Revolving Credit Facility [Member] | ' |
Derivative Financial Instruments | ' |
Percentage of Proved Oil and Gas Properties Secured for Credit Facility Borrowing | 75.00% |
Derivative_Financial_Instrumen3
Derivative Financial Instruments Fair Value (Details) (USD $) | Mar. 31, 2014 | Dec. 31, 2013 |
Fair value of derivative assets and liabilities | ' | ' |
Price Risk Derivatives, at Fair Value, Net | ($47,200,000) | $21,500,000 |
Derivative asset current | 7,450,000 | 21,559,000 |
Derivative asset noncurrent | 13,886,000 | 30,951,000 |
Derivative liability current | 60,684,000 | 26,380,000 |
Derivatives liability noncurrent | 7,885,000 | 4,640,000 |
Derivatives not designated as hedging instruments | ' | ' |
Fair value of derivative assets and liabilities | ' | ' |
Derivative asset current | 7,450,000 | 21,559,000 |
Derivative asset noncurrent | 13,886,000 | 30,951,000 |
Derivative liability current | 60,684,000 | 26,380,000 |
Derivatives liability noncurrent | 7,885,000 | 4,640,000 |
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 | 21,336,000 | 52,510,000 |
Derivative liabilities not designated as hedging instruments | $68,569,000 | $31,020,000 |
Derivative_Financial_Instrumen4
Derivative Financial Instruments Gains and Losses (Details) (USD $) | 3 Months Ended | |||
In Thousands, unless otherwise specified | Mar. 31, 2014 | Mar. 31, 2013 | ||
Gain and loss from derivative cash settlements and changes in fair value of derivative contracts | ' | ' | ||
Derivative cash settlement (loss) gain | ($28,940) | [1] | $11,792 | [1] |
Gain (Loss) on Derivative Instruments, Net, Pretax | -97,662 | [2] | -30,572 | [2] |
Crude oil | ' | ' | ||
Gain and loss from derivative cash settlements and changes in fair value of derivative contracts | ' | ' | ||
Derivative cash settlement (loss) gain | -6,758 | -277 | ||
Derivative (gain) loss | 25,192 | 3,789 | ||
Natural Gas | ' | ' | ||
Gain and loss from derivative cash settlements and changes in fair value of derivative contracts | ' | ' | ||
Derivative cash settlement (loss) gain | -13,404 | 9,824 | ||
Derivative (gain) loss | 46,057 | 40,069 | ||
Natural Gas Liquids | ' | ' | ||
Gain and loss from derivative cash settlements and changes in fair value of derivative contracts | ' | ' | ||
Derivative cash settlement (loss) gain | -8,778 | 2,245 | ||
Derivative (gain) loss | ($2,527) | ($1,494) | ||
[1] | (1)B Total derivative cash settlement loss (gain) is reported in the derivative cash settlement (loss) gain line item on the condensed consolidated statements of cash flows within net cash provided by operating activities. | |||
[2] | (2)B Total derivative loss is reported in the derivative loss line item on the condensed consolidated statements of cash flows within cash provided by operating activities. |
Derivative_Financial_Instrumen5
Derivative Financial Instruments Offsetting of Derivative Assets and Liabilities (Details) (USD $) | Mar. 31, 2014 | Dec. 31, 2013 |
In Thousands, unless otherwise specified | ||
Offsetting of Derivative Assets and Liabilities [Abstract] | ' | ' |
Derivative Asset, Fair Value, Amount Offset Against Collateral | $21,336 | $52,510 |
Derivative Asset, Fair Value, Amount Not Offset Against Collateral | -21,336 | -30,652 |
Derivative Asset, Fair Value, Amount Offset Against Collateral, Net | 0 | 21,858 |
Derivative Liability, Fair Value, Amount Offset Against Collateral | -68,569 | -31,020 |
Derivative Liability, Fair Value, Amount Not Offset Against Collateral | 21,336 | 30,652 |
Derivative Liability, Fair Value, Amount Offset Against Collateral, Net | ($47,233) | ($368) |
Fair_Value_Measurements_Detail
Fair Value Measurements (Details) (USD $) | Apr. 23, 2014 | Mar. 31, 2014 | Dec. 31, 2013 | ||
In Thousands, unless otherwise specified | |||||
Assets: | ' | ' | ' | ||
Proved oil and gas properties | ' | $5,875,541 | $5,637,462 | ||
Unproved oil and gas properties | ' | 287,607 | 271,100 | ||
Oil and gas properties held for sale net of accumulated depletion, depreciation and amortization of $31,776 in 2014 and $7,390 in 2013 | ' | 42,276 | 19,072 | ||
Liabilities: | ' | ' | ' | ||
Line of Credit Facility, Amount Outstanding | 0 | 0 | 0 | ||
Fair Value, Measurements, Nonrecurring [Member] | Level 1 | ' | ' | ' | ||
Assets: | ' | ' | ' | ||
Proved oil and gas properties | ' | ' | 0 | [1] | |
Unproved oil and gas properties | ' | ' | 0 | [1] | |
Oil and gas properties held for sale net of accumulated depletion, depreciation and amortization of $31,776 in 2014 and $7,390 in 2013 | ' | ' | 0 | [1] | |
Fair Value, Measurements, Nonrecurring [Member] | Level 2 | ' | ' | ' | ||
Assets: | ' | ' | ' | ||
Proved oil and gas properties | ' | ' | 0 | [1] | |
Unproved oil and gas properties | ' | ' | 0 | [1] | |
Oil and gas properties held for sale net of accumulated depletion, depreciation and amortization of $31,776 in 2014 and $7,390 in 2013 | ' | ' | 0 | [1] | |
Fair Value, Measurements, Nonrecurring [Member] | Level 3 | ' | ' | ' | ||
Assets: | ' | ' | ' | ||
Proved oil and gas properties | ' | ' | 62,178 | [1] | |
Unproved oil and gas properties | ' | ' | 3,280 | [1] | |
Oil and gas properties held for sale net of accumulated depletion, depreciation and amortization of $31,776 in 2014 and $7,390 in 2013 | ' | ' | 650 | [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 | ' | 55,209 | [2] | 56,985 | [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 | ' | 21,336 | [2] | 52,510 | [2] |
Liabilities: | ' | ' | ' | ||
Derivatives | ' | 68,569 | [2] | 31,020 | [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 $) | 3 Months Ended | |||||||||||
Mar. 31, 2014 | Mar. 31, 2014 | Mar. 31, 2014 | Mar. 31, 2014 | Dec. 31, 2013 | Mar. 31, 2014 | Dec. 31, 2013 | Mar. 31, 2014 | Dec. 31, 2013 | Mar. 31, 2014 | Dec. 31, 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] | 5.0% Senior Notes Due 2024 [Member] | |||
Liabiliity measured at fair value using Level 3 inputs | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | |
Long-term Debt, Fair Value | ' | ' | ' | $375,375,000 | $374,290,000 | $376,250,000 | $373,625,000 | $428,760,000 | $422,000,000 | $488,440,000 | $475,315,000 | |
Net Profits Plan | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | |
Discount Rate Used to Calculate Currently in Payout Liabilities | ' | 12.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | |
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 | ' | 5,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | |
Percent Change in Discount Rate for Sensitivity Analysis | ' | 1.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | |
Sensitivity Analysis Decrease in Liability Due to Change in Discount Rate | ' | 2,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | |
Cash Payments Made or Accrued under Profit Sharing Plan Related to Divested Property | ' | ' | 217,000 | ' | ' | ' | ' | ' | ' | ' | ' | |
Fair Value, Assets and Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Abstract] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | |
Beginning balance | ' | 56,985,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | |
Net increase in liability | ' | 1,707,000 | [1] | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Net settlements | ' | -3,483,000 | [1],[2] | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Transfers in (out) of Level 3 | ' | 0 | ' | ' | ' | ' | ' | ' | ' | ' | ' | |
Ending balance | ' | $55,209,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | |
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] | 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 | |||||||||||
[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 $217,000 relating to divestiture proceeds for the three months ended MarchB 31, 2014 |