Document and Entity Information
Document and Entity Information Document - shares | 6 Months Ended | |
Jun. 30, 2015 | Jul. 22, 2015 | |
Entity Information [Line Items] | ||
Entity Registrant Name | SM Energy Co | |
Entity Central Index Key | 893,538 | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Large Accelerated Filer | |
Document Type | 10-Q | |
Document Period End Date | Jun. 30, 2015 | |
Document Fiscal Year Focus | 2,015 | |
Document Fiscal Period Focus | Q2 | |
Amendment Flag | false | |
Entity Common Stock, Shares Outstanding | 67,950,361 | |
Entity Current Reporting Status | Yes |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS (UNAUDITED) (in thousands, except share amounts) - USD ($) $ in Thousands | Jun. 30, 2015 | Dec. 31, 2014 |
Assets | ||
Cash and cash equivalents | $ 82 | $ 120 |
Accounts receivable | 239,983 | 322,630 |
Derivative asset | 269,022 | 402,668 |
Prepaid expenses and other | 16,621 | 19,625 |
Total current assets | 525,708 | 745,043 |
Proved Oil and Gas Properties | 7,356,877 | 7,348,436 |
Less - accumulated depletion, depreciation, and amortization | (3,073,603) | (3,233,012) |
Unproved Oil and Gas Properties | 419,903 | 532,498 |
Wells in progress | 419,979 | 503,734 |
Oil and gas properties held for sale net of accumulated depletion, depreciation and amortization of $30,514 and $22,482, respectively | 7,361 | 17,891 |
Other property and equipment, net of accumulated depreciation of $38,051 and $37,079, respectively | 354,528 | 334,356 |
Total property and equipment, net | 5,485,045 | 5,503,903 |
Derivative asset | 131,464 | 189,540 |
Other noncurrent assets | 71,401 | 78,214 |
Total other noncurrent assets | 202,865 | 267,754 |
Total Assets | 6,213,618 | 6,516,700 |
Liabilities | ||
Accounts payable and accrued expenses | 423,536 | 640,684 |
Derivative liability, current | 8,107 | 0 |
Deferred tax liability | 90,514 | 142,976 |
Other current liabilities | 0 | 1,000 |
Total current liabilities | 522,157 | 784,660 |
Revolving credit facility | 122,000 | 166,000 |
Senior Notes (note 5) | 2,350,000 | 2,200,000 |
Asset retirement obligation | 115,276 | 120,867 |
Net Profits Plan liability | 18,326 | 27,136 |
Deferred income taxes | 859,588 | 891,681 |
Derivative liability | 1,026 | 70 |
Other noncurrent liabilities | 36,938 | 39,631 |
Total noncurrent liabilities | $ 3,503,154 | $ 3,445,385 |
Commitments and contingencies (note 6) | ||
Stockholders' equity: | ||
Common stock, $0.01 par value - authorized: 200,000,000 shares; issued and outstanding; 67,598,649 and 67,463,060, respectively | $ 676 | $ 675 |
Additional paid-in-capital | 299,637 | 283,295 |
Retained earnings | 1,900,058 | 2,013,997 |
Accumulated other comprehensive loss | (12,064) | (11,312) |
Total stockholders' equity | 2,188,307 | 2,286,655 |
Total Liabilities and Stockholders' Equity | $ 6,213,618 | $ 6,516,700 |
Balance Sheet Parenthetical (Pa
Balance Sheet Parenthetical (Parentheticals) - USD ($) $ in Thousands | Jun. 30, 2015 | Dec. 31, 2014 |
Oil and Gas Property, Successful Effort Method, Accumulated Depreciation, Depletion and Amortization | $ 3,073,603 | $ 3,233,012 |
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 | 67,598,649 | 67,463,060 |
Common Stock, Shares, Outstanding | 67,598,649 | 67,463,060 |
Assets Held-for-sale [Member] | ||
Oil and Gas Property, Successful Effort Method, Accumulated Depreciation, Depletion and Amortization | $ 30,514 | $ 22,482 |
Other Capitalized Property Plant and Equipment [Member] | ||
Oil and Gas Property, Successful Effort Method, Accumulated Depreciation, Depletion and Amortization | $ 38,051 | $ 37,079 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED) (in thousands, except per share amounts) - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2015 | Jun. 30, 2014 | Jun. 30, 2015 | Jun. 30, 2014 | |
Operating revenues: | ||||
Oil, gas, and NGL production revenue | $ 441,256 | $ 654,661 | $ 834,571 | $ 1,277,770 |
Gain on divestiture activity | 71,884 | 2,526 | 36,082 | 5,484 |
Other operating revenues | 3,006 | 17,793 | 11,427 | 24,446 |
Total operating revenues and other income | 516,146 | 674,980 | 882,080 | 1,307,700 |
Operating expenses: | ||||
Oil, gas, and NGL production expense | 173,685 | 177,598 | 369,836 | 341,307 |
Depletion, depreciation, amortization, and asset retirement obligation liability accretion | 219,704 | 187,781 | 437,105 | 364,996 |
Exploration | 25,541 | 24,270 | 62,948 | 45,605 |
Impairment of proved properties | 12,914 | 0 | 68,440 | 0 |
Abandonment and impairment of unproved properties | 5,819 | 164 | 17,446 | 2,965 |
General and administrative | 42,605 | 38,115 | 86,244 | 73,166 |
Change in Net Profits Plan liability | (4,476) | (7,105) | (8,810) | (8,881) |
Derivative (gain) loss | 80,929 | 126,469 | (73,238) | 224,131 |
Other operating expenses | 10,304 | 5,972 | 27,423 | 14,061 |
Total operating expenses | 567,025 | 553,264 | 987,394 | 1,057,350 |
Income (loss) from operations | (50,879) | 121,716 | (105,314) | 250,350 |
Non-operating income (expense): | ||||
Other, net | 25 | (1,847) | 596 | (1,821) |
Interest expense | (30,779) | (24,040) | (63,426) | (48,230) |
Loss on extinguishment of debt | (16,578) | 0 | (16,578) | 0 |
Income (loss) before income taxes | (98,211) | 95,829 | (184,722) | 200,299 |
Income tax (expense) benefit | 40,703 | (36,049) | 74,156 | (74,912) |
Net income (loss) | $ (57,508) | $ 59,780 | $ (110,566) | $ 125,387 |
Basic weighted-average common shares outstanding | 67,483 | 67,069 | 67,473 | 67,063 |
Diluted weighted-average common shares outstanding | 67,483 | 68,239 | 67,473 | 68,180 |
Basic net income (loss) per common share | $ (0.85) | $ 0.89 | $ (1.64) | $ 1.87 |
Diluted net income (loss) per common share | (0.85) | 0.88 | (1.64) | 1.84 |
Dividends per common share | $ 0 | $ 0 | $ 0.05 | $ 0.05 |
CONDENSED CONSOLIDATED STATEME5
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2015 | Jun. 30, 2014 | Jun. 30, 2015 | Jun. 30, 2014 | |
Statement of Comprehensive Income [Abstract] | ||||
Net income (loss) | $ (57,508) | $ 59,780 | $ (110,566) | $ 125,387 |
Pension liability adjustment | (576) | 330 | (752) | 330 |
Total other comprehensive income (loss), net of tax | (576) | 330 | (752) | 330 |
Total comprehensive income (loss) | $ (58,084) | $ 60,110 | $ (111,318) | $ 125,717 |
CONDENSED CONSOLIDATED STATEME6
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 6 Months Ended | |
Jun. 30, 2015 | Jun. 30, 2014 | |
Statement of Cash Flows [Abstract] | ||
Net income (loss) | $ (110,566) | $ 125,387 |
Adjustments to reconcile net income (loss) to net cash provided by operating activities: | ||
Gain on divestiture activity | 36,082 | 5,484 |
Depletion, depreciation, amortization, and asset retirement obligation liability accretion | 437,105 | 364,996 |
Exploratory dry hole expense | 22,896 | 6,459 |
Impairment of proved properties | 68,440 | 0 |
Abandonment and impairment of unproved properties | 17,446 | 2,965 |
Stock-based compensation expense | 13,215 | 14,341 |
Change in Net Profits Plan liability | (8,810) | (8,881) |
Derivative (gain) loss | (73,238) | 224,131 |
Derivative cash settlements | 291,619 | (62,620) |
Amortization of deferred financing costs | 3,892 | 2,954 |
Non-cash loss on extinguishment of debt | 4,123 | 0 |
Deferred income taxes | (84,556) | 73,911 |
Plugging and abandonment | (3,386) | (3,219) |
Other, net | (434) | (4,827) |
Changes in current assets and liabilities: | ||
Accounts receivable | 38,951 | (2,558) |
Prepaid expenses and other | 2,933 | 1,302 |
Accounts payable and accrued expenses | (34,040) | (13,704) |
Net Cash Provided by Operating Activities | 549,508 | 715,153 |
Proceeds from Sale of Oil and Gas Property and Equipment | 334,988 | 46,821 |
Cash flows from investing activities: | ||
Capital expenditures | (974,130) | (778,580) |
Acquisition of proved and unproved oil and gas properties | (6,588) | (98,619) |
Other, net | (996) | (2,257) |
Net cash used in investing activities | (646,726) | (832,635) |
Cash flows from financing activities: | ||
Proceeds from credit facility | 1,230,500 | 0 |
Repayment of credit facility | (1,274,500) | 0 |
Net proceeds from Senior Notes | 491,557 | 0 |
Repayment of Senior Notes | (350,000) | 0 |
Proceeds from sale of Common Stock | 3,157 | 2,490 |
Dividends paid | (3,373) | (3,353) |
Other, net | (161) | (109) |
Net cash provided by (used in) financing activities | 97,180 | (972) |
Net change in cash and cash equivalents | (38) | (118,454) |
Cash and cash equivalents at beginning of period | 120 | 282,248 |
Cash and cash equivalents at ending of period | 82 | 163,794 |
Supplemental schedule of additional cash flow information and noncash investing and financing activities: | ||
Cash paid for interest, net of capitalized interest | 64,899 | 47,403 |
Net cash paid for income taxes | $ 380 | $ 162 |
CONDENSED CONSOLIDATED STATEME7
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED) (in thousands) (Parenthetical) - USD ($) $ in Millions | 6 Months Ended | |
Jun. 30, 2015 | Jun. 30, 2014 | |
Supplemental Cash Flow Information [Abstract] | ||
Capital Expenditures Incurred but Not yet Paid | $ 164.9 | $ 328.6 |
The Company and Business
The Company and Business | 6 Months Ended |
Jun. 30, 2015 | |
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. |
Basis of Presentation, Signific
Basis of Presentation, Significant Accounting Policies, and Recently Issued Accounting Standards | 6 Months Ended |
Jun. 30, 2015 | |
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, 2014 (the “ 2014 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 June 30, 2015 , through the filing date of this report. Certain prior period amounts have been reclassified to conform to the current presentation on the accompanying financial statements. 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 2014 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 2014 Form 10-K. Recently Issued Accounting Standards Effective January 1, 2015, the Company early adopted, on a prospective basis, Financial Accounting Standards Board (“FASB”) Accounting Standards Update (“ASU”) No. 2015-01, “Income Statement – Extraordinary and Unusual Items.” This ASU simplifies income statement presentation by eliminating the concept of extraordinary items. There was no impact to the Company’s financial statements or disclosures from the adoption of this standard. In April 2015, the FASB issued new authoritative accounting guidance requiring debt issuance costs to be presented on the balance sheet as a direct deduction from the carrying value of the related debt liability. This guidance is to be applied using a retrospective method and is effective for annual periods, and interim periods within those annual periods, beginning after December 15, 2015. Early application is permitted. The Company is currently evaluating the provisions of this guidance and assessing its impact on the Company’s financial statements and 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 June 30, 2015 , and through the filing date of this report that have not been disclosed above or in the 2014 Form 10-K. |
Acquisitions, Divestitures, and
Acquisitions, Divestitures, and Assets Held for Sale (Notes) | 6 Months Ended |
Jun. 30, 2015 | |
Divestiture Activity [Abstract] | |
Acquisitions, Divestitures, and Assets Held for Sale | Note 3 – Acquisitions, Divestitures, and Assets Held for Sale Divestitures During the second quarter of 2015, the Company divested its Mid-Continent assets in separate packages for total cash proceeds received at closing, which reflects gross purchase price net of closing adjustments (referred to throughout this report as “divestiture proceeds”), of $316.5 million and an estimated total net gain of $107.8 million . These assets were classified as held for sale as of March 31, 2015, and certain of these assets were written down by $30.0 million during the three months ended March 31, 2015, to reflect fair value less estimated costs to sell. This write-down is reflected in the total net gain of $107.8 million discussed above. These divestitures are subject to normal post-closing adjustments. In conjunction with the Company’s efforts to divest its Mid-Continent assets, the Company had previously announced the planned closure of its Tulsa, Oklahoma office in 2015, with the relocation of certain personnel to other Company offices. The Company expects to incur a total of approximately $10 million of exit and disposal costs associated with the severance, retention and relocation of employees, and other related matters, excluding the lease expenses discussed in the next paragraph. The majority of these exit and disposal activities are expected to be completed by the end of the third quarter of 2015. For the three and six months ended June 30, 2015 , the Company recorded $5.0 million and $8.5 million , respectively, of exit and disposal costs, the majority of which were recorded as general and administrative expense in the accompanying condensed consolidated statements of operations (“accompanying statements of operations”). Additionally, subsequent to June 30, 2015, the Company vacated its office space in Tulsa and is currently attempting to sublease the remaining space. As of June 30, 2015, the Company is obligated to pay approximately $7 million , net of expected income from office space currently subleased, which will be expensed over the duration of the lease, which expires in 2022. This obligation will decrease if the Company successfully executes additional sublease agreements. 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. Any subsequent decreases to the estimated fair value less the costs to sell impact the measurement of assets held for sale. As of June 30, 2015 , the accompanying condensed consolidated balance sheets (“accompanying balance sheets”) present $7.4 million of assets held for sale, net of accumulated depletion, depreciation, and amortization expense, which primarily consists of certain assets in exploratory areas that the Company no longer intends to explore and develop in light of the low commodity price environment. There is a corresponding asset retirement obligation liability of approximately $200,000 for assets held for sale recorded in the asset retirement obligation liability financial statement line item in the accompanying balance sheets. For the three months ended June 30, 2015, the Company recorded write-downs to fair value less estimated costs to sell of $66.0 million for certain of these assets held for sale. For the six months ended June 30, 2015, write-downs on certain assets held for sale totaled $99.9 million , which included the $30.0 million write-down recorded on certain Mid-Continent assets in the first quarter 2015 as discussed above. These write-downs are recorded in the net gain on divestiture activity line item in the accompanying statements of operations. The Company determined that neither these planned nor executed asset sales qualify for discontinued operations accounting under financial statement presentation authoritative guidance. |
Income Taxes
Income Taxes | 6 Months Ended |
Jun. 30, 2015 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Note 4 - Income Taxes Income tax expense (benefit) for the three and six months ended June 30, 2015 , and 2014 , differs from the amount 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 or loss as of each period end presented. The provision for income taxes consists of the following: For the Three Months Ended June 30, For the Six Months Ended June 30, 2015 2014 2015 2014 (in thousands) Current portion of income tax expense: Federal $ — $ — $ — $ — State 10,126 512 10,400 1,001 Deferred portion of income tax expense (benefit) (50,829 ) 35,537 (84,556 ) 73,911 Total income tax expense (benefit) $ (40,703 ) $ 36,049 $ (74,156 ) $ 74,912 41.4 % 37.6 % 40.1 % 37.4 % 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. As a result of divestitures during the second quarter of 2015, the Company no longer has oil and gas operations in Oklahoma or Louisiana and recorded current state income tax expense related to the sold properties. Cumulative effects of state rate changes are reflected in the period legislation is enacted. The cumulative effects of Texas and North Dakota enacted rate changes are reflected above in the deferred portion of income tax expense (benefit). The Company is generally no longer subject to United States federal or state income tax examinations by tax authorities for years before 2007 . During the first quarter of 2015, as a result of its R&D credit settlement with the IRS Appeals Office in late 2014, the Company recorded an additional $2.0 million net R&D credit from a claim filed on an amended return. No R&D credit was recorded in 2014. |
Long-Term Debt
Long-Term Debt | 6 Months Ended |
Jun. 30, 2015 | |
Debt Disclosure [Abstract] | |
Long-term debt | Note 5 - Long-term Debt Revolving Credit Facility The Company’s Fifth Amended and Restated Credit Agreement, as amended (the “Credit Agreement”), provides a maximum loan amount of $2.5 billion , current aggregate lender commitments of $1.5 billion , and a maturity date of December 10, 2019 . In April 2015, the lenders maintained the borrowing base at $2.4 billion as part of the regularly scheduled semi-annual redetermination under the Credit Agreement. In the Third Amendment to the Credit Agreement dated May 20, 2015, the lenders agreed not to reduce the $2.4 billion borrowing base as a result of the issuance of the Company’s 5.625% Senior Notes due 2025 and the Mid-Continent divestitures. The next redetermination date is scheduled for October 1, 2015 . Borrowings under the facility are secured by mortgages on assets having a value equal to at least 75 percent of the total value of the Company’s proved oil and gas properties. The Company must comply with certain financial and non-financial covenants under the terms of the Credit Agreement, including limitations on the payment of dividends to $50.0 million per year. The Company was in compliance with all covenants under the Credit Agreement as of June 30, 2015 , 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 Credit Agreement as of July 22, 2015 , June 30, 2015 , and December 31, 2014 : As of July 22, 2015 As of June 30, 2015 As of December 31, 2014 (in thousands) Credit facility balance $ 175,000 $ 122,000 $ 166,000 Letters of credit (1) $ 200 $ 200 $ 808 Available borrowing capacity $ 1,324,800 $ 1,377,800 $ 1,333,192 ____________________________________________ (1) Letters of credit reduce the amount available 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 notes shown in the table below (the “Senior Notes”): As of June 30, 2015 As of December 31, 2014 (in thousands) 6.625% Senior Notes due 2019 $ — $ 350,000 6.50% Senior Notes due 2021 350,000 350,000 6.125% Senior Notes due 2022 600,000 600,000 6.50% Senior Notes due 2023 400,000 400,000 5.0% Senior Notes due 2024 500,000 500,000 5.625% Senior Notes due 2025 500,000 — Total Senior Notes $ 2,350,000 $ 2,200,000 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 this restricted payment covenant. The Company was in compliance with all covenants under its Senior Notes as of June 30, 2015 , and through the filing date of this report. 2019 Notes On May 7, 2015, the Company commenced a cash tender offer for any and all of its outstanding 6.625% Senior Notes due 2019 (the “2019 Notes”) at a price of $1,036.88 per $1,000 of principal amount for all 2019 Notes tendered by May 20, 2015 (“Consent Payment Deadline”), and at a price of $1,006.88 per $1,000 of principal amount for all 2019 Notes properly tendered thereafter. On the Consent Payment Deadline, the Company received tenders and consents from the holders of approximately $242.9 million in aggregate principal amount, or approximately 69% , of its outstanding 2019 Notes in connection with the cash tender offer. Following its entry into the supplemental indenture dated as of May 21, 2015, to the indenture dated as of February 7, 2011, between the Company and U.S. Bank National Association, as Trustee, the Company accepted the 2019 Notes tendered as of the Consent Payment Deadline in exchange for payment of total consideration, including accrued interest, of approximately $256.2 million under the Tender Offer and Consent Solicitation. On June 5, 2015 , the Company accepted $1.5 million of 2019 Notes tendered after the Consent Payment Deadline in exchange for payment of total consideration, including accrued interest, of approximately $1.6 million . On June 22, 2015 , the Company redeemed the remaining outstanding 2019 Notes at a redemption price of 103.313% of the principal amount for payment of total consideration, including accrued interest, of approximately $111.5 million . The Company recorded a loss on extinguishment of debt related to the tender offer and redemption of its 2019 Notes of approximately $16.6 million for the quarter ended June 30, 2015 . This amount includes approximately $12.5 million associated with the premium paid for the tender offer and redemption of the 2019 Notes and approximately $4.1 million related to the acceleration of unamortized deferred financing costs. 2025 Notes On May 21, 2015 , the Company issued and sold $500.0 million in aggregate principal amount of 5.625% Senior Notes due 2025 (the “2025 Notes”) to certain underwriters in a public offering registered under the Securities Act of 1933, as amended (the “Securities Act”). The 2025 Notes were issued at par and mature on June 1, 2025 . The Company received net proceeds of approximately $491.1 million after deducting paid and accrued fees of $8.9 million , which are being amortized as deferred financing costs over the life of the 2025 Notes. The net proceeds were used to fund the consideration paid to the tendering holders of the 2019 Notes and to redeem the remaining un-tendered 2019 Notes, as well as repay outstanding borrowings under the Credit Agreement and for general corporate purposes. Prior to June 1, 2018 , the Company may redeem, on one or more occasions, up to 35 percent of the aggregate principal amount of the 2025 Notes with the net cash proceeds of certain equity offerings at a redemption price of 105.625% of the principal amount thereof, plus accrued and unpaid interest. The Company may also redeem the 2025 Notes, in whole or in part, at any time prior to June 1, 2020 , at a redemption price equal to 100 percent of the principal amount of the 2025 Notes to be redeemed, plus a specified make-whole premium and accrued and unpaid interest to the applicable redemption date. On or after June 1, 2020 , the Company may also redeem all or, from time to time during the twelve-month period beginning on June 1 of each applicable year, a portion of the 2025 Notes at the redemption prices set forth below expressed as a percentage of the principal amount redeemed, plus accrued and unpaid interest: 2020 102.813 % 2021 101.875 % 2022 100.938 % 2023 and thereafter 100.000 % 2022 Notes The Company completed its offer to exchange its 6.125% Senior Notes due 2022 for notes registered under the Securities Exchange Act of 1934 (the “Exchange Act”) on July 10, 2015. |
Commitments and Contingencies
Commitments and Contingencies | 6 Months Ended |
Jun. 30, 2015 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Note 6 - Commitments and Contingencies Commitments There were no material changes in commitments during the first half of 2015. Please refer to Note 6 - Commitments and Contingencies in the Company’s 2014 Form 10-K for additional discussion. In light of the low commodity price environment, the Company curtailed drilling activity during the first half of 2015. For the three and six months ended June 30, 2015, the Company incurred drilling rig termination fees of $2.7 million and $5.9 million , respectively, which are recorded in the other operating expenses line item in the accompanying statements of operations. 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 expected results of any 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. The Company is subject to routine severance, royalty and joint interest audits from regulatory authorities, non-operators and others, as the case may be, and records accruals for estimated exposure when a claim is deemed probable and estimable. Additionally, the Company is subject to various possible contingencies that arise from third party interpretations of the Company’s contracts or otherwise affecting the oil and natural gas industry. Such contingencies include differing interpretations as to the prices at which oil and natural gas sales may be made, the prices that royalty owners are paid for production from their leases, allowable costs under joint interest arrangements, and other matters. At June 30, 2015, the Company had $4.7 million accrued for estimated exposure related to claims for payment of royalties on certain Federal and Indian leases. Although the Company believes that it has properly estimated its exposure with respect to the various contracts, laws and regulations, administrative rulings, and interpretations thereof, adjustments could be required as new interpretations and regulations arise. |
Compensation Plans
Compensation Plans | 6 Months Ended |
Jun. 30, 2015 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Compensation Plans | Note 7 - Compensation Plans Performance Share Units Under the Equity Incentive Compensation Plan The Company grants performance share units (“PSUs”) to eligible employees as a 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 certain performance criteria 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 performance period and the relative performance of the Company’s TSR compared with the annualized TSR of certain peer companies for the performance period. PSUs are recognized as general and administrative and exploration expense over the vesting periods of the award. Total expense recorded for PSUs for the three months ended June 30, 2015 , and 2014 , was $2.7 million and $3.6 million , respectively, and $5.0 million and $6.8 million for the six months ended June 30, 2015 , and 2014 , respectively. As of June 30, 2015 , there was $13.0 million of total unrecognized compensation expense related to unvested PSU awards, which is being amortized through 2017 . There were no material changes to the outstanding and non-vested PSUs during the six months ended June 30, 2015 . Subsequent to June 30, 2015 , the Company granted 320,753 PSUs with a fair value of $14.5 million as part of its regular annual long-term equity compensation program. These PSUs will fully vest on the third anniversary of the date of the grant. Also, subsequent to June 30, 2015 , the Company settled PSUs that were granted in 2012 , which earned a 1.0 times multiplier, by issuing a net 188,279 shares of the Company’s common stock in accordance with the terms of the respective PSU awards. The Company and the majority of grant participants mutually agreed to net share settle a portion of the awards to cover income and payroll tax withholdings as provided for in the plan document and award agreements. As a result, 100,683 shares were withheld to satisfy income and payroll tax withholding obligations that occurred upon delivery of the shares underlying those PSUs. 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 for one share of the Company’s common stock to be delivered upon settlement of the award at the end of the specified vesting period. RSUs are recognized as general and administrative expense and exploration expense over the vesting periods of the award. Total expense recorded for RSUs was $2.9 million for each of the three months ended June 30, 2015 , and 2014 , and $5.8 million and $5.7 million for the six months ended June 30, 2015 , and 2014 , respectively. As of June 30, 2015 , there was $14.3 million of total unrecognized compensation expense related to unvested RSU awards, which is being amortized through 2017 . There were no material changes to the outstanding and non-vested RSUs during the six months ended June 30, 2015 . Subsequent to June 30, 2015 , the Company granted 356,246 RSUs with a fair value of $15.6 million as part of its regular annual long-term equity compensation program. These RSUs will vest 1/3 rd on each of the next three anniversary dates of the grant. Also, subsequent to June 30, 2015 , the Company settled 236,342 RSUs that related to awards granted in previous years. The Company and the majority of grant participants mutually agreed to net share settle a portion of the awards to cover income and payroll tax withholdings as provided for in the plan document and award agreements. As a result, the Company issued 163,433 net shares of common stock. The remaining 72,909 shares were withheld to satisfy income and payroll tax withholding obligations that occurred upon delivery of the shares underlying those RSUs. Director Shares During the first half of 2015 and 2014 , the Company issued 37,950 and 23,009 shares, respectively, of its common stock to its non-employee directors, under the Company’s Equity Incentive Compensation Plan. The Company recorded approximately $1.2 million of compensation expense related to these awards for the three and six months ended June 30, 2015 , and 2014 . All shares of common stock issued to the Company’s non-employee directors are earned over the one -year service period following the date of grant, unless five years of service has been provided by the director, in which case that director’s shares vest upon the earlier of the completion of the one -year service period or the director retiring from the Board of Directors. Employee Stock Purchase Plan Under the Company’s Employee Stock Purchase Plan (“ESPP”), eligible employees may purchase shares of the Company’s common stock through payroll deductions of up to 15 percent of eligible compensation, without accruing in excess of $25,000 in value from purchases for each calendar year. The purchase price of the stock is 85% of the lower of the fair market value of the stock on the first or last day of the purchase period, and shares issued under the ESPP have no restriction period. The ESPP is intended to qualify under Section 423 of the Internal Revenue Code (“IRC”). The Company had 1.1 million shares available for issuance under the ESPP as of June 30, 2015 . There were 96,285 and 35,249 shares issued under the ESPP during the second quarters of 2015 and 2014 , respectively. The fair value of ESPP grants is measured at the date of grant using the Black-Scholes option-pricing model. Net Profits Plan Cash payments made or accrued under the Company’s Net Profits Plan totaled $1.9 million and $2.2 million for the three months ended June 30, 2015 , and 2014 , respectively, and $3.2 million and $5.4 million for the six months ended June 30, 2015 , and 2014 , respectively, the majority of which were recorded as general and administrative expense within the accompanying statements of operations. Additionally, the Company accrued or made cash payments under the Net Profits Plan of $3.8 million for the three -month and six -month periods ended June 30, 2015 , and $8.5 million for the three -month and six -month periods ended June 30, 2014 , as a result of the divestitures of properties subject to the Net Profits Plan. These cash payments are accounted for as a reduction in the net gain on divestiture activity line item in the accompanying statements of operations. The Company records changes in the present value of estimated future payments under the Net Profits Plan as a separate line item in the accompanying statements of operations. The change in the estimated liability is recorded as a non-cash expense or benefit in the current period. The amount recorded as an expense or benefit associated with the change in the estimated liability is not allocated to general and administrative 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 general and administrative expense. As time has passed, the amount distributed relating to prospective exploration efforts has become insignificant as more is paid to employees that have terminated employment and do not provide ongoing exploration support to the Company. |
Pension Benefits
Pension Benefits | 6 Months Ended |
Jun. 30, 2015 | |
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 June 30, For the Six Months Ended June 30, 2015 2014 2015 2014 (in thousands) Service cost $ 2,390 $ 1,595 $ 3,974 $ 3,168 Interest cost 700 688 1,248 1,095 Expected return on plan assets that reduces periodic pension costs (597 ) (604 ) (1,091 ) (989 ) Amortization of prior service costs 5 5 9 9 Amortization of net actuarial loss 571 38 743 344 Net periodic benefit cost $ 3,069 $ 1,722 $ 4,883 $ 3,627 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 $5.6 million to the Pension Plans during the six month period ended June 30, 2015 . |
Earnings per Share
Earnings per Share | 6 Months Ended |
Jun. 30, 2015 | |
Earnings Per Share [Abstract] | |
Earnings per Share | Note 9 - Earnings Per Share Basic net income or loss per common share is calculated by dividing net income or loss 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 or loss per common share is calculated by dividing adjusted net income or loss by the diluted weighted-average common shares outstanding, which includes the effect of potentially dilutive securities. Potentially dilutive securities for this calculation consist of unvested RSUs, contingent PSUs, and in-the-money outstanding stock options. The treasury stock method is used to measure the dilutive impact of these stock awards. All remaining stock options were exercised during the year ended December 31, 2014, and therefore, were only dilutive for the three and six months ended June 30, 2014. When there is a loss from continuing operations, as was the case for the three and six months ended June 30, 2015, all potentially dilutive shares are anti-dilutive and are consequently excluded from the calculation of diluted net loss per common share. For the three and six months ended June 30, 2015, weighted-average anti-dilutive securities related to unvested RSUs and contingent PSUs totaled approximately 590,000 and 490,000 shares, respectively. 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 Share 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 June 30, For the Six Months Ended June 30, 2015 2014 2015 2014 (in thousands, except per share amounts) Net income (loss) $ (57,508 ) $ 59,780 $ (110,566 ) $ 125,387 Basic weighted-average common shares outstanding 67,483 67,069 67,473 67,063 Add: dilutive effect of stock options, unvested RSUs, and contingent PSUs — 1,170 — 1,117 Diluted weighted-average common shares outstanding 67,483 68,239 67,473 68,180 Basic net income (loss) per common share $ (0.85 ) $ 0.89 $ (1.64 ) $ 1.87 Diluted net income (loss) per common share $ (0.85 ) $ 0.88 $ (1.64 ) $ 1.84 |
Derivative Financial Instrument
Derivative Financial Instruments | 6 Months Ended |
Jun. 30, 2015 | |
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 collar arrangements for oil, gas, and NGLs. As of June 30, 2015 , the Company had commodity derivative contracts outstanding through the second quarter of 2020 for a total of 9.7 million Bbls of oil production, 167.0 million MMBtu of gas production, and 9.5 million Bbls of NGL production. In a typical commodity swap agreement, if the agreed upon published third-party index price (“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 index price and the floor price if the index price is below the floor price. The Company pays the difference between the 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 June 30, 2015 : Oil Contracts Oil Swaps Contract Period NYMEX WTI Volumes Weighted-Average Contract Price (Bbls) (per Bbl) Third quarter 2015 1,254,000 $ 90.78 Fourth quarter 2015 1,137,000 $ 90.15 2016 5,570,000 $ 88.01 All oil swaps 7,961,000 Oil Collars Contract Period NYMEX WTI Volumes Weighted- Average Floor Price Weighted- Average Ceiling Price (Bbls) (per Bbl) (per Bbl) Third quarter 2015 906,000 $ 85.00 $ 91.25 Fourth quarter 2015 869,000 $ 85.00 $ 92.19 All oil collars 1,775,000 Gas Contracts Gas Swaps Contract Period Volumes Weighted-Average Contract Price (MMBtu) (per MMBtu) Third quarter 2015 12,835,000 $ 4.03 Fourth quarter 2015 12,499,000 $ 4.01 2016 45,172,000 $ 4.13 2017 34,335,000 $ 4.19 2018 30,606,000 $ 4.27 2019 24,415,000 $ 4.34 All gas swaps* 159,862,000 *Gas swaps are comprised of IF El Paso Permian ( 3% ), IF HSC ( 93% ), IF NGPL TXOK ( 1% ), and IF NNG Ventura ( 3% ). Gas Collars Contract Period Volumes Weighted- Average Floor Price Weighted- Average Ceiling Price (MMBtu) (per MMBtu) (per MMBtu) Third quarter 2015 2,005,000 $ 4.00 $ 4.30 Fourth quarter 2015 5,157,000 $ 3.99 $ 4.29 All gas collars* 7,162,000 *Gas collars are comprised of IF El Paso Permian ( 5% ), IF HSC ( 88% ), and IF NNG Ventura ( 7% ). NGL Contracts NGL Swaps Contract Period Volumes Weighted-Average Contract Price (Bbls) (per Bbl) Third quarter 2015 1,739,000 $ 21.61 Fourth quarter 2015 1,539,000 $ 21.73 2016 2,017,000 $ 17.70 2017 792,000 $ 9.98 2018 1,671,000 $ 10.65 2019 1,200,000 $ 10.92 2020 539,000 $ 11.13 All NGL swaps* 9,497,000 *NGL swaps are comprised of Oil Price Information System (“OPIS”) Ethane Purity Mont Belvieu ( 52% ), OPIS Propane Mont Belvieu Non-TET ( 29% ), OPIS Normal Butane Mont Belvieu Non-TET ( 10% ), and OPIS Isobutane Mont Belvieu Non-TET ( 9% ). Derivative Assets and Liabilities Fair Value The Company’s commodity derivatives are measured at fair value and are included in the accompanying balance sheets as derivative assets and liabilities. The fair value of the commodity derivative contracts was a net asset of $391.4 million as of June 30, 2015 , and net asset of $592.1 million as of December 31, 2014 . The following tables detail the fair value of derivatives recorded in the accompanying balance sheets, by category: As of June 30, 2015 Derivative Assets Derivative Liabilities Balance Sheet Classification Fair Value Balance Sheet Classification Fair Value (in thousands) Commodity contracts Current assets $ 269,022 Current liabilities $ 8,107 Commodity contracts Noncurrent assets 131,464 Noncurrent liabilities 1,026 Derivatives not designated as hedging instruments $ 400,486 $ 9,133 As of December 31, 2014 Derivative Assets Derivative Liabilities Balance Sheet Classification Fair Value Balance Sheet Classification Fair Value (in thousands) Commodity contracts Current assets $ 402,668 Current liabilities $ — Commodity contracts Noncurrent assets 189,540 Noncurrent liabilities 70 Derivatives not designated as hedging instruments $ 592,208 $ 70 Offsetting of Derivative Assets and Liabilities As of June 30, 2015 , and December 31, 2014 , all derivative instruments held by the Company were subject to master netting arrangements by various financial institutions. In general, the terms of the Company’s agreements provide for offsetting of amounts payable or receivable between it and the counterparty, at the election of both parties, for transactions that settle 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 June 30, 2015 December 31, 2014 June 30, 2015 December 31, 2014 (in thousands) Gross amounts presented in the accompanying balance sheets $ 400,486 $ 592,208 $ (9,133 ) $ (70 ) Amounts not offset in the accompanying balance sheets (9,133 ) (70 ) 9,133 70 Net amounts $ 391,353 $ 592,138 $ — $ — The following table summarizes the components of the derivative (gain) loss presented in the accompanying statements of operations: For the Three Months Ended June 30, For the Six Months Ended June 30, 2015 2014 2015 2014 (in thousands) Derivative settlement (gain) loss: Oil contracts $ (73,915 ) $ 20,160 $ (180,129 ) $ 26,918 Gas contracts (1) (38,880 ) 13,472 (73,112 ) 26,876 NGL contracts — 48 (20,783 ) 8,826 Total derivative settlement (gain) loss (2) $ (112,795 ) $ 33,680 $ (274,024 ) $ 62,620 Total derivative (gain) loss: Oil contracts $ 66,749 $ 93,595 $ (7,111 ) $ 125,545 Gas contracts 6,070 28,154 (76,269 ) 87,615 NGL contracts 8,110 4,720 10,142 10,971 Total derivative (gain) loss (3) $ 80,929 $ 126,469 $ (73,238 ) $ 224,131 ____________________________________________ (1) Natural gas derivative settlements for the three and six months ended June 30, 2015 include a $15.3 million gain on the early settlement of future contracts as a result of divesting of the Company’s Mid-Continent assets during the second quarter of 2015. (2) Total derivative settlement (gain) loss is reported net of the change in accrued settlements between periods in the derivative cash settlements line item on the condensed consolidated statements of cash flows within net cash provided by operating activities. (3) Total derivative (gain) loss is reported in the derivative (gain) loss line item on the condensed consolidated statements of cash flows within net cash provided by operating activities. Credit Related Contingent Features As of June 30, 2015 , 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 mortgages on assets having a value equal to at least 75 percent of the total value of the Company’s proved oil and gas properties. |
Fair Value Measurements Fair Va
Fair Value Measurements Fair Value Measurements | 6 Months Ended |
Jun. 30, 2015 | |
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. This 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 table is a listing of the Company’s assets and liabilities that are measured at fair value in the accompanying balance sheets and where they are classified within the fair value hierarchy as of June 30, 2015 : Level 1 Level 2 Level 3 (in thousands) Assets: Derivatives (1) $ — $ 400,486 $ — Proved oil and gas properties (2) $ — $ — $ 7,658 Oil and gas properties held for sale (2) $ — $ — $ 5,801 Liabilities: Derivatives (1) $ — $ 9,133 $ — Net Profits Plan (1) $ — $ — $ 18,326 ____________________________________________ (1) This represents a financial asset or liability that is measured at fair value on a recurring basis. (2) This represents a non-financial asset or liability that is measured at fair value on a nonrecurring basis. The following is a listing of the Company’s assets and liabilities that are measured at fair value in the accompanying balance sheets and where they were classified within the hierarchy as of December 31, 2014 : Level 1 Level 2 Level 3 (in thousands) Assets: Derivatives (1) $ — $ 592,208 $ — Proved oil and gas properties (2) $ — $ — $ 33,423 Oil and gas properties held for sale (2) $ — $ — $ 17,891 Liabilities: Derivatives (1) $ — $ 70 $ — Net Profits Plan (1) $ — $ — $ 27,136 ____________________________________________ (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 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 forward commodity price curves, 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. The considered 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 derivative liability position. 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 valuation technique, 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 derivative 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 June 30, 2015 , would differ by approximately $1.8 million . A one percent increase or decrease in the discount rate would result in a change of approximately $650,000 . 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 of 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 Six Months Ended June 30, 2015 (in thousands) Beginning balance $ 27,136 Net decrease in liability (1) (1,796 ) Net settlements (1) (2) (7,014 ) Transfers in (out) of Level 3 — Ending balance $ 18,326 ____________________________________________ (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 amount in the table includes cash payments made or accrued under the Net Profits Plan of $3.8 million for the six -month period ended June 30, 2015 , as a result of the divestitures of properties subject to the Net Profits Plan. 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 June 30, 2015 , or December 31, 2014 , as they are recorded at historical value. As of June 30, 2015 As of December 31, 2014 (in thousands) 6.625% Senior Notes due 2019 $ — $ 350,018 6.50% Senior Notes due 2021 $ 362,250 $ 343,000 6.125% Senior Notes due 2022 $ 621,000 $ 556,500 6.50% Senior Notes due 2023 $ 412,000 $ 379,000 5.0% Senior Notes due 2024 $ 471,250 $ 435,000 5.625% Senior Notes due 2025 $ 493,850 $ — The carrying value of the Company’s credit facility approximates its fair value, as the applicable interest rates are floating, based on prevailing market rates. Proved 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 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 June 30, 2015 , and December 31, 2014 . The Company believes 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 forecast 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 forecast 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. The Company recorded impairment of proved oil and gas properties of $12.9 million and $68.4 million for the three months and six months ended June 30, 2015, respectively, due to continued declines in commodity strip prices since year-end 2014, the Company’s decision to reduce capital invested in the development of certain prospects in its South Texas & Gulf Coast and Permian regions, and a decline in performance of non-core assets. Proved properties measured at fair value within the accompanying balance sheets totaled $7.7 million as of June 30, 2015 . As of December 31, 2014, proved oil and gas properties measured at fair value totaled $33.4 million . Proved properties classified as held for sale, including the corresponding asset retirement obligation liability, 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 available. If an estimated selling price is not available, the Company utilizes the income valuation technique discussed above. For the three and six months ended June 30, 2015, the Company recorded write-downs to fair value less estimated costs to sell of $66.0 million and $99.9 million , respectively, for certain assets held for sale. These write-downs are included within the net gain on divestiture activity line item on the accompanying statements of operations. Please refer to Note 3 – Acquisitions, Divestitures, and Assets Held for Sale. 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. The Company recorded abandonment and impairment of unproved oil and gas properties expense of $5.8 million and $17.4 million for the three and six months ended June 30, 2015, respectively, related to acreage the Company no longer intends to develop. Unproved properties measured at fair value were written down to zero in the accompanying balance sheets as of June 30, 2015 , and December 31, 2014 . The fair value measurements of assets acquired and liabilities assumed are measured on a nonrecurring basis on the acquisition date using an income valuation technique based on inputs that are not observable in the market and therefore represent Level 3 inputs. Significant inputs to the valuation of acquired oil and gas properties include estimates of: (i) reserves; (ii) production rates; (iii) future operating and development costs; (iv) future commodity prices, including price differentials; (v) future cash flows; and (vi) a market participant-based weighted average cost of capital rate. These inputs require significant judgments and estimates by the Company’s management at the time of the valuation. |
Suspended Well Costs (Notes)
Suspended Well Costs (Notes) | 6 Months Ended |
Jun. 30, 2015 | |
Suspended Well Costs [Abstract] | |
Suspended Well Costs Disclosure [Text Block] | Note 12 - Suspended Well Costs For the three and six months ended June 30, 2015, the Company charged to exploration expense $6.0 million and $21.1 million , respectively, of capitalized exploratory well costs as of December 31, 2014. These costs were related to two wells, for which none of the costs were capitalized for a period greater than one year as of December 31, 2014, or at the time the wells were determined to be unsuccessful. |
Basis of Presentation, Signif20
Basis of Presentation, Significant Accounting Policies, and Recently Issued Accounting Standards (Policies) | 6 Months Ended |
Jun. 30, 2015 | |
Accounting Policies [Abstract] | |
Fair Value of Financial Instruments, Policy [Policy Text Block] | 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 forward commodity price curves, 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. The considered 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 derivative liability position. 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. |
Fair Value Measurements Derivat
Fair Value Measurements Derivatives (Policies) | 6 Months Ended |
Jun. 30, 2015 | |
Fair Value Disclosures [Abstract] | |
Fair Value of Financial Instruments, Policy [Policy Text Block] | 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 forward commodity price curves, 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. The considered 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 derivative liability position. 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. |
Income Taxes (Tables)
Income Taxes (Tables) | 6 Months Ended |
Jun. 30, 2015 | |
Income Tax Disclosure [Abstract] | |
Schedule of provision for income taxes | The provision for income taxes consists of the following: For the Three Months Ended June 30, For the Six Months Ended June 30, 2015 2014 2015 2014 (in thousands) Current portion of income tax expense: Federal $ — $ — $ — $ — State 10,126 512 10,400 1,001 Deferred portion of income tax expense (benefit) (50,829 ) 35,537 (84,556 ) 73,911 Total income tax expense (benefit) $ (40,703 ) $ 36,049 $ (74,156 ) $ 74,912 41.4 % 37.6 % 40.1 % 37.4 % |
Long-Term Debt (Tables)
Long-Term Debt (Tables) | 6 Months Ended |
Jun. 30, 2015 | |
Debt Disclosure [Abstract] | |
Schedule of Line of Credit Facilities [Table Text Block] | The following table presents the outstanding balance, total amount of letters of credit, and available borrowing capacity under the Credit Agreement as of July 22, 2015 , June 30, 2015 , and December 31, 2014 : As of July 22, 2015 As of June 30, 2015 As of December 31, 2014 (in thousands) Credit facility balance $ 175,000 $ 122,000 $ 166,000 Letters of credit (1) $ 200 $ 200 $ 808 Available borrowing capacity $ 1,324,800 $ 1,377,800 $ 1,333,192 ____________________________________________ (1) Letters of credit reduce the amount available under the credit facility on a dollar-for-dollar basis. |
Schedule of Long-term Debt Instruments [Table Text Block] | The Senior Notes line on the accompanying balance sheets represents the outstanding principal amount of the notes shown in the table below (the “Senior Notes”): As of June 30, 2015 As of December 31, 2014 (in thousands) 6.625% Senior Notes due 2019 $ — $ 350,000 6.50% Senior Notes due 2021 350,000 350,000 6.125% Senior Notes due 2022 600,000 600,000 6.50% Senior Notes due 2023 400,000 400,000 5.0% Senior Notes due 2024 500,000 500,000 5.625% Senior Notes due 2025 500,000 — Total Senior Notes $ 2,350,000 $ 2,200,000 |
Debt Instrument Redemption [Table Text Block] | On or after June 1, 2020 , the Company may also redeem all or, from time to time during the twelve-month period beginning on June 1 of each applicable year, a portion of the 2025 Notes at the redemption prices set forth below expressed as a percentage of the principal amount redeemed, plus accrued and unpaid interest: 2020 102.813 % 2021 101.875 % 2022 100.938 % 2023 and thereafter 100.000 % |
Pension Benefits (Tables)
Pension Benefits (Tables) | 6 Months Ended |
Jun. 30, 2015 | |
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 June 30, For the Six Months Ended June 30, 2015 2014 2015 2014 (in thousands) Service cost $ 2,390 $ 1,595 $ 3,974 $ 3,168 Interest cost 700 688 1,248 1,095 Expected return on plan assets that reduces periodic pension costs (597 ) (604 ) (1,091 ) (989 ) Amortization of prior service costs 5 5 9 9 Amortization of net actuarial loss 571 38 743 344 Net periodic benefit cost $ 3,069 $ 1,722 $ 4,883 $ 3,627 |
Earnings per Share (Tables)
Earnings per Share (Tables) | 6 Months Ended |
Jun. 30, 2015 | |
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 June 30, For the Six Months Ended June 30, 2015 2014 2015 2014 (in thousands, except per share amounts) Net income (loss) $ (57,508 ) $ 59,780 $ (110,566 ) $ 125,387 Basic weighted-average common shares outstanding 67,483 67,069 67,473 67,063 Add: dilutive effect of stock options, unvested RSUs, and contingent PSUs — 1,170 — 1,117 Diluted weighted-average common shares outstanding 67,483 68,239 67,473 68,180 Basic net income (loss) per common share $ (0.85 ) $ 0.89 $ (1.64 ) $ 1.87 Diluted net income (loss) per common share $ (0.85 ) $ 0.88 $ (1.64 ) $ 1.84 |
Derivative Financial Instrume26
Derivative Financial Instruments (Tables) | 6 Months Ended |
Jun. 30, 2015 | |
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 June 30, 2015 : Oil Contracts Oil Swaps Contract Period NYMEX WTI Volumes Weighted-Average Contract Price (Bbls) (per Bbl) Third quarter 2015 1,254,000 $ 90.78 Fourth quarter 2015 1,137,000 $ 90.15 2016 5,570,000 $ 88.01 All oil swaps 7,961,000 Oil Collars Contract Period NYMEX WTI Volumes Weighted- Average Floor Price Weighted- Average Ceiling Price (Bbls) (per Bbl) (per Bbl) Third quarter 2015 906,000 $ 85.00 $ 91.25 Fourth quarter 2015 869,000 $ 85.00 $ 92.19 All oil collars 1,775,000 Gas Contracts Gas Swaps Contract Period Volumes Weighted-Average Contract Price (MMBtu) (per MMBtu) Third quarter 2015 12,835,000 $ 4.03 Fourth quarter 2015 12,499,000 $ 4.01 2016 45,172,000 $ 4.13 2017 34,335,000 $ 4.19 2018 30,606,000 $ 4.27 2019 24,415,000 $ 4.34 All gas swaps* 159,862,000 *Gas swaps are comprised of IF El Paso Permian ( 3% ), IF HSC ( 93% ), IF NGPL TXOK ( 1% ), and IF NNG Ventura ( 3% ). Gas Collars Contract Period Volumes Weighted- Average Floor Price Weighted- Average Ceiling Price (MMBtu) (per MMBtu) (per MMBtu) Third quarter 2015 2,005,000 $ 4.00 $ 4.30 Fourth quarter 2015 5,157,000 $ 3.99 $ 4.29 All gas collars* 7,162,000 *Gas collars are comprised of IF El Paso Permian ( 5% ), IF HSC ( 88% ), and IF NNG Ventura ( 7% ). NGL Contracts NGL Swaps Contract Period Volumes Weighted-Average Contract Price (Bbls) (per Bbl) Third quarter 2015 1,739,000 $ 21.61 Fourth quarter 2015 1,539,000 $ 21.73 2016 2,017,000 $ 17.70 2017 792,000 $ 9.98 2018 1,671,000 $ 10.65 2019 1,200,000 $ 10.92 2020 539,000 $ 11.13 All NGL swaps* 9,497,000 *NGL swaps are comprised of Oil Price Information System (“OPIS”) Ethane Purity Mont Belvieu ( 52% ), OPIS Propane Mont Belvieu Non-TET ( 29% ), OPIS Normal Butane Mont Belvieu Non-TET ( 10% ), and OPIS Isobutane Mont Belvieu Non-TET ( 9% ). |
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 June 30, 2015 Derivative Assets Derivative Liabilities Balance Sheet Classification Fair Value Balance Sheet Classification Fair Value (in thousands) Commodity contracts Current assets $ 269,022 Current liabilities $ 8,107 Commodity contracts Noncurrent assets 131,464 Noncurrent liabilities 1,026 Derivatives not designated as hedging instruments $ 400,486 $ 9,133 As of December 31, 2014 Derivative Assets Derivative Liabilities Balance Sheet Classification Fair Value Balance Sheet Classification Fair Value (in thousands) Commodity contracts Current assets $ 402,668 Current liabilities $ — Commodity contracts Noncurrent assets 189,540 Noncurrent liabilities 70 Derivatives not designated as hedging instruments $ 592,208 $ 70 |
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 June 30, 2015 December 31, 2014 June 30, 2015 December 31, 2014 (in thousands) Gross amounts presented in the accompanying balance sheets $ 400,486 $ 592,208 $ (9,133 ) $ (70 ) Amounts not offset in the accompanying balance sheets (9,133 ) (70 ) 9,133 70 Net amounts $ 391,353 $ 592,138 $ — $ — |
Schedule of derivative (gain) loss | The following table summarizes the components of the derivative (gain) loss presented in the accompanying statements of operations: For the Three Months Ended June 30, For the Six Months Ended June 30, 2015 2014 2015 2014 (in thousands) Derivative settlement (gain) loss: Oil contracts $ (73,915 ) $ 20,160 $ (180,129 ) $ 26,918 Gas contracts (1) (38,880 ) 13,472 (73,112 ) 26,876 NGL contracts — 48 (20,783 ) 8,826 Total derivative settlement (gain) loss (2) $ (112,795 ) $ 33,680 $ (274,024 ) $ 62,620 Total derivative (gain) loss: Oil contracts $ 66,749 $ 93,595 $ (7,111 ) $ 125,545 Gas contracts 6,070 28,154 (76,269 ) 87,615 NGL contracts 8,110 4,720 10,142 10,971 Total derivative (gain) loss (3) $ 80,929 $ 126,469 $ (73,238 ) $ 224,131 ____________________________________________ (1) Natural gas derivative settlements for the three and six months ended June 30, 2015 include a $15.3 million gain on the early settlement of future contracts as a result of divesting of the Company’s Mid-Continent assets during the second quarter of 2015. (2) Total derivative settlement (gain) loss is reported net of the change in accrued settlements between periods in the derivative cash settlements line item on the condensed consolidated statements of cash flows within net cash provided by operating activities. (3) Total derivative (gain) loss is reported in the derivative (gain) loss line item on the condensed consolidated statements of cash flows within net cash provided by operating activities. |
Fair Value Measurements Fair 27
Fair Value Measurements Fair Value Measurements (Tables) | 6 Months Ended |
Jun. 30, 2015 | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Fair Value Measurements, Recurring and Nonrecurring [Table Text Block] | The following table is a listing of the Company’s assets and liabilities that are measured at fair value in the accompanying balance sheets and where they are classified within the fair value hierarchy as of June 30, 2015 : Level 1 Level 2 Level 3 (in thousands) Assets: Derivatives (1) $ — $ 400,486 $ — Proved oil and gas properties (2) $ — $ — $ 7,658 Oil and gas properties held for sale (2) $ — $ — $ 5,801 Liabilities: Derivatives (1) $ — $ 9,133 $ — Net Profits Plan (1) $ — $ — $ 18,326 ____________________________________________ (1) This represents a financial asset or liability that is measured at fair value on a recurring basis. (2) This represents a non-financial asset or liability that is measured at fair value on a nonrecurring basis. The following is a listing of the Company’s assets and liabilities that are measured at fair value in the accompanying balance sheets and where they were classified within the hierarchy as of December 31, 2014 : Level 1 Level 2 Level 3 (in thousands) Assets: Derivatives (1) $ — $ 592,208 $ — Proved oil and gas properties (2) $ — $ — $ 33,423 Oil and gas properties held for sale (2) $ — $ — $ 17,891 Liabilities: Derivatives (1) $ — $ 70 $ — Net Profits Plan (1) $ — $ — $ 27,136 ____________________________________________ (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 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. |
Net Profit Plan liability [Member] | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Net Profit Plan 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 Six Months Ended June 30, 2015 (in thousands) Beginning balance $ 27,136 Net decrease in liability (1) (1,796 ) Net settlements (1) (2) (7,014 ) Transfers in (out) of Level 3 — Ending balance $ 18,326 ____________________________________________ (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 amount in the table includes cash payments made or accrued under the Net Profits Plan of $3.8 million for the six -month period ended June 30, 2015 , as a result of the divestitures of properties subject to the Net Profits Plan. |
Senior Notes [Member] | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Senior Notes Fair Value [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 June 30, 2015 , or December 31, 2014 , as they are recorded at historical value. As of June 30, 2015 As of December 31, 2014 (in thousands) 6.625% Senior Notes due 2019 $ — $ 350,018 6.50% Senior Notes due 2021 $ 362,250 $ 343,000 6.125% Senior Notes due 2022 $ 621,000 $ 556,500 6.50% Senior Notes due 2023 $ 412,000 $ 379,000 5.0% Senior Notes due 2024 $ 471,250 $ 435,000 5.625% Senior Notes due 2025 $ 493,850 $ — |
Acquisitions, Divestitures, a28
Acquisitions, Divestitures, and Assets Held for Sale Divestitures (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2015 | Mar. 31, 2015 | Jun. 30, 2015 | Jun. 30, 2014 | |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||
Net proceeds from sale of oil and gas properties | $ 334,988 | $ 46,821 | ||
Disposal Group, Not Discontinued Operation, Loss (Gain) on Write-down | $ 66,000 | 99,900 | ||
Mid Continent Divestiture 2015 [Member] | ||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||
Net proceeds from sale of oil and gas properties | 316,500 | |||
Disposal Group, Not Discontinued Operation, Gain (Loss) on Disposal | 107,800 | |||
Disposal Group, Not Discontinued Operation, Loss (Gain) on Write-down | $ 30,000 | |||
Total Expected Exit and Disposal Costs | 10,000 | |||
Business Exit Costs | $ 5,000 | 8,500 | ||
Mid Continent Divestiture 2015 [Member] | Office Space Leases [Member] | ||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||
Long-term Purchase Commitment, Amount | $ 7,000 |
Acquisitions, Divestitures, a29
Acquisitions, Divestitures, and Assets Held for Sale Assets Held for Sale (Details) | 3 Months Ended | 6 Months Ended | |
Jun. 30, 2015USD ($) | Jun. 30, 2015USD ($) | Dec. 31, 2014USD ($) | |
Assets held for sale [Abstract] | |||
Assets Held-for-sale Reasonably Certain Period for Sale | 1 | ||
Disposal Group, Including Discontinued Operation, Assets, Current | $ 7,361,000 | $ 7,361,000 | $ 17,891,000 |
Asset Retirement Obligations Assets Held-for-sale Noncurrent | 200,000 | 200,000 | |
Disposal Group, Not Discontinued Operation, Loss (Gain) on Write-down | $ 66,000,000 | $ 99,900,000 |
Income Taxes (Details)
Income Taxes (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2015 | Jun. 30, 2014 | Jun. 30, 2015 | Jun. 30, 2014 | |
Components of the provision for income taxes | ||||
Federal | $ 0 | $ 0 | $ 0 | $ 0 |
State | 10,126 | 512 | 10,400 | 1,001 |
Deferred portion of income tax expense | (50,829) | 35,537 | (84,556) | 73,911 |
Income tax expense | $ (40,703) | $ 36,049 | $ (74,156) | $ 74,912 |
Effective tax rate | 41.40% | 37.60% | 40.10% | 37.40% |
Income Taxes Narrative (Details
Income Taxes Narrative (Details) $ in Millions | 3 Months Ended |
Mar. 31, 2015USD ($) | |
Income Tax Narrative [Abstract] | |
Tax Credit Recorded for IRS R&D Settlement | $ 2 |
Long-Term Debt Revolving Credit
Long-Term Debt Revolving Credit Facility (Details) - USD ($) $ in Thousands | 6 Months Ended | |||
Jun. 30, 2015 | Jul. 22, 2015 | Dec. 31, 2014 | ||
Debt Instrument [Line Items] | ||||
Long-term Line of Credit | $ 122,000 | $ 166,000 | ||
Revolving Credit Facility [Member] | ||||
Debt Instrument [Line Items] | ||||
Line of Credit Facility, Maximum Borrowing Capacity | 2,500,000 | |||
Line of Credit Facility, Current Borrowing Capacity | 1,500,000 | |||
Borrowing Base, Line of Credit | $ 2,400,000 | |||
Percentage of Proved Property Secured for Credit Facility Borrowing | 75.00% | |||
Line of Credit, Covenant Compliance, Maximum Annual Dividend Payment | $ 50,000 | |||
Long-term Line of Credit | 122,000 | 166,000 | ||
Letters of Credit Outstanding, Amount | [1] | 200 | 808 | |
Line of Credit Facility, Remaining Borrowing Capacity | $ 1,377,800 | $ 1,333,192 | ||
Subsequent Event [Member] | Revolving Credit Facility [Member] | ||||
Debt Instrument [Line Items] | ||||
Long-term Line of Credit | $ 175,000 | |||
Letters of Credit Outstanding, Amount | [1] | 200 | ||
Line of Credit Facility, Remaining Borrowing Capacity | $ 1,324,800 | |||
[1] | (1) Letters of credit reduce the amount available under the credit facility on a dollar-for-dollar basis. |
Long-Term Debt Senior Notes (De
Long-Term Debt Senior Notes (Details) - USD ($) | 3 Months Ended | 6 Months Ended | |||||||
Jun. 30, 2015 | Jun. 30, 2014 | Jun. 30, 2015 | Jun. 30, 2014 | Jun. 22, 2015 | Jun. 05, 2015 | May. 21, 2015 | May. 20, 2015 | Dec. 31, 2014 | |
Debt Instrument [Line Items] | |||||||||
Senior Notes | $ 2,350,000,000 | $ 2,350,000,000 | $ 2,200,000,000 | ||||||
Loss on extinguishment of debt | 16,578,000 | $ 0 | 16,578,000 | $ 0 | |||||
Senior Notes [Member] | |||||||||
Debt Instrument [Line Items] | |||||||||
6.625% Senior Notes, Due 2019 Face Value | 0 | 0 | 350,000,000 | ||||||
6.50% Senior Notes, Due 2021 Face Value | 350,000,000 | 350,000,000 | 350,000,000 | ||||||
6.125% Senior Notes, Due 2022 Face Value | 600,000,000 | 600,000,000 | 600,000,000 | ||||||
6.50% Senior Notes, Due 2023 Face Value | 400,000,000 | 400,000,000 | 400,000,000 | ||||||
5% Senior Notes, Due 2024 Face Value | 500,000,000 | 500,000,000 | 500,000,000 | ||||||
5.625% Senior Notes, Due 2025 Face Value | 500,000,000 | 500,000,000 | 0 | ||||||
Senior Notes | $ 2,350,000,000 | 2,350,000,000 | $ 2,200,000,000 | ||||||
Debt Instrument, Covenant Compliance, Dividends Excluded From Computation | $ 6,500,000 | ||||||||
Senior Notes [Member] | 5.625% Senior Notes Due 2025 [Member] | |||||||||
Debt Instrument [Line Items] | |||||||||
Debt Instrument, Interest Rate, Stated Percentage | 5.625% | 5.625% | |||||||
Proceeds from Debt, Net of Paid and Accrued Issuance Costs | $ 491,100,000 | ||||||||
Debt Instrument, Face Amount | $ 500,000,000 | ||||||||
Debt Issuance Cost | $ 8,900,000 | ||||||||
Senior Notes [Member] | 5.625% Senior Notes Due 2025 [Member] | Debt Instrument, Redemption, Period One [Member] | |||||||||
Debt Instrument [Line Items] | |||||||||
Debt Instrument, Redemption Price, Percentage | 105.625% | ||||||||
Debt Instrument, Maximum Early Redemption, Percentage of Principal | 35.00% | ||||||||
Senior Notes [Member] | 5.625% Senior Notes Due 2025 [Member] | Debt Instrument, Redemption, Period Two [Member] | |||||||||
Debt Instrument [Line Items] | |||||||||
Debt Instrument, Redemption Price, Percentage | 100.00% | ||||||||
Senior Notes [Member] | 5.625% Senior Notes Due 2025 [Member] | Debt Instrument, Redemption, Period Three [Member] | |||||||||
Debt Instrument [Line Items] | |||||||||
Debt Instrument, Redemption Price, Percentage | 102.813% | ||||||||
Senior Notes [Member] | 5.625% Senior Notes Due 2025 [Member] | Debt Instrument, Redemption, Period Four [Member] | |||||||||
Debt Instrument [Line Items] | |||||||||
Debt Instrument, Redemption Price, Percentage | 101.875% | ||||||||
Senior Notes [Member] | 5.625% Senior Notes Due 2025 [Member] | Debt Instrument, Redemption, Period Five [Member] | |||||||||
Debt Instrument [Line Items] | |||||||||
Debt Instrument, Redemption Price, Percentage | 100.938% | ||||||||
Senior Notes [Member] | 5.625% Senior Notes Due 2025 [Member] | Debt Instrument, Redemption, Period Six [Member] | |||||||||
Debt Instrument [Line Items] | |||||||||
Debt Instrument, Redemption Price, Percentage | 100.00% | ||||||||
Senior Notes [Member] | 6.625% Senior Notes Due 2019 [Member] | |||||||||
Debt Instrument [Line Items] | |||||||||
Debt Instrument, Interest Rate, Stated Percentage | 6.625% | 6.625% | |||||||
Price per Note Tendered | $ 1,006.88 | $ 1,036.88 | |||||||
Debt Instrument, Face Amount, Individual Note | 1,000 | 1,000 | |||||||
Debt Instrument, Repurchased Face Amount | 1,500,000 | $ 242,900,000 | |||||||
Percentage of Notes Tendered | 69.00% | ||||||||
Debt Instrument, Repurchase Amount | $ 1,600,000 | $ 256,200,000 | |||||||
Loss on extinguishment of debt | $ 16,600,000 | ||||||||
Debt Instrument, Repurchase Premium | 12,500,000 | ||||||||
Unamortized Debt Issuance Expense | $ 4,100,000 | $ 4,100,000 | |||||||
Senior Notes [Member] | 6.625% Senior Notes Due 2019 [Member] | Early Debt Redemption, Year [Domain] | |||||||||
Debt Instrument [Line Items] | |||||||||
Debt Instrument, Repurchase Amount | $ 111,500,000 | ||||||||
Debt Instrument, Redemption Price, Percentage | 103.313% | ||||||||
Senior Notes [Member] | 6.125% Senior Notes Due 2022 [Member] | |||||||||
Debt Instrument [Line Items] | |||||||||
Debt Instrument, Interest Rate, Stated Percentage | 6.125% | 6.125% |
Commitments and Contingencies C
Commitments and Contingencies Commitments and Contingencies (Details) - Jun. 30, 2015 - USD ($) $ in Millions | Total | Total |
Drilling Rig Commitment [Domain] | ||
Other Commitments [Line Items] | ||
Gain (Loss) on Contract Termination | $ (2.7) | $ (5.9) |
Commitments and Contingencies L
Commitments and Contingencies Loss Contingency (Details) $ in Millions | Jun. 30, 2015USD ($) |
Royalty Dispute [Domain] | |
Loss Contingencies [Line Items] | |
Loss Contingency Accrual | $ 4.7 |
Compensation Plans (Details)
Compensation Plans (Details) | 1 Months Ended | 3 Months Ended | 6 Months Ended | ||
Jul. 22, 2015USD ($)shares | Jun. 30, 2015USD ($)shares | Jun. 30, 2014USD ($)shares | Jun. 30, 2015USD ($)shares | Jun. 30, 2014USD ($)shares | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Stock-based compensation expense | $ | $ 13,215,000 | $ 14,341,000 | |||
Performance Shares [Member] | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Share-based Compensation, Awards Other Than Options, Performance Measurement Period | 3 | 3 | |||
Stock-based compensation expense | $ | $ 2,700,000 | $ 3,600,000 | $ 5,000,000 | 6,800,000 | |
Unrecognized stock based compensation expense | $ | $ 13,000,000 | 13,000,000 | |||
Restricted Stock Units (RSUs) [Member] | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Number of Shares Represented by Each RSU | 1 | ||||
Stock-based compensation expense | $ | $ 2,900,000 | 2,900,000 | 5,800,000 | 5,700,000 | |
Unrecognized stock based compensation expense | $ | 14,300,000 | 14,300,000 | |||
Shares Issued to the Board of Directors [Member] | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Stock-based compensation expense | $ | $ 1,200,000 | $ 1,200,000 | $ 1,200,000 | $ 1,200,000 | |
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Period | 1 year | ||||
Share-based Compensation Arrangement by Share-based Payment Award, Non-Option Equity Instruments, Granted | 37,950 | 23,009 | |||
Shares Issued to the Board of Directors, Director with 5 or more years of service [Member] | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Period | 5 years | ||||
Subsequent Event [Member] | Performance Shares [Member] | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Grants in Period | 320,753 | ||||
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Granted in Period, Total Fair Value | $ | $ 14,500,000 | ||||
Multiplier Applied to PSU Awards Upon Settlement | 1 | ||||
Restricted Stock, Shares Issued Net of Shares for Tax Withholdings | 188,279 | ||||
Shares Paid for Tax Withholding for Share Based Compensation | 100,683 | ||||
Subsequent Event [Member] | Restricted Stock Units (RSUs) [Member] | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Grants in Period | 356,246 | ||||
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Granted in Period, Total Fair Value | $ | $ 15,600,000 | ||||
Restricted Stock, Shares Issued Net of Shares for Tax Withholdings | 163,433 | ||||
Shares Paid for Tax Withholding for Share Based Compensation | 72,909 | ||||
Share-based Compensation Arrangement by Share-based Payment Award, Non-Option Equity Instruments, Granted | 236,342 | ||||
Employee Stock [Member] | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Share-based Compensation Arrangement by Share-based Payment Award, Non-Option Equity Instruments, Granted | 96,285 | 35,249 | |||
Share-based Compensation Arrangement by Share-based Payment Award, Maximum Employee Subscription Rate | 15.00% | 15.00% | |||
Share-based Compensation Arragement by Share-based Payment Award, Maximum Employee Subscription | $ | $ 25,000 | $ 25,000 | |||
Share-based Compensation Arrangement by Share-Based Payment Award, Percent of Offering Date Price Paid | 85.00% | 85.00% | |||
Share-based Compensation Arrangement by Share-based Payment Award, Number of Shares Available for Grant | 1,100,000 | 1,100,000 | |||
Minimum [Member] | Performance Shares [Member] | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Share-based Compensation Arrangement by Share-based Payment Award, Number of Shares Awarded per Performance Stock Unit | 0.00% | ||||
Maximum [Member] | Performance Shares [Member] | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Share-based Compensation Arrangement by Share-based Payment Award, Number of Shares Awarded per Performance Stock Unit | 200.00% |
Compensation Plans Non Stock-ba
Compensation Plans Non Stock-based Compensation (Details) - Net Profits Plan [Member] - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2015 | Jun. 30, 2014 | Jun. 30, 2015 | Jun. 30, 2014 | |
Total Cash Payments, Made or Accrued under Profit Sharing Plan | $ 1.9 | $ 2.2 | $ 3.2 | $ 5.4 |
Cash Payments Made or Accrued under Profit Sharing Plan Related to Divestiture Proceeds | $ 3.8 | $ 8.5 | $ 3.8 | $ 8.5 |
Pension Benefits (Details)
Pension Benefits (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2015 | Jun. 30, 2014 | Jun. 30, 2015 | Jun. 30, 2014 | |
Components of Net Periodic Benefit Costs for Both Pension Plans | ||||
Service cost | $ 2,390 | $ 1,595 | $ 3,974 | $ 3,168 |
Interest cost | 700 | 688 | 1,248 | 1,095 |
Expected return on plan assets that reduces periodic pension costs | (597) | (604) | (1,091) | (989) |
Amortization of prior service costs | 5 | 5 | 9 | 9 |
Amortization of net actuarial loss | 571 | 38 | 743 | 344 |
Net periodic benefit cost | $ 3,069 | $ 1,722 | $ 4,883 | $ 3,627 |
Pension Benefits Pension Narrat
Pension Benefits Pension Narrative (Details) - 6 months ended Jun. 30, 2015 - USD ($) $ in Millions | Total |
Pension Narrative [Abstract] | |
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% |
Pension and Other Postretirement Benefit Contributions | $ 5.6 |
Earnings per Share (Details)
Earnings per Share (Details) $ / shares in Units, $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2015USD ($)$ / sharesshares | Jun. 30, 2014USD ($)$ / sharesshares | Jun. 30, 2015USD ($)$ / sharesshares | Jun. 30, 2014USD ($)$ / sharesshares | |
Earnings per share | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount | 590,000 | 490,000 | ||
Calculation of basic and diluted earnings per share | ||||
Net income (loss) | $ | $ (57,508) | $ 59,780 | $ (110,566) | $ 125,387 |
Basic weighted-average common shares outstanding | 67,483,000 | 67,069,000 | 67,473,000 | 67,063,000 |
Add: dilutive effect of stock options, unvested RSU's, and contingent PSU's | 0 | 1,170,000 | 0 | 1,117,000 |
Diluted weighted-average common shares outstanding | 67,483,000 | 68,239,000 | 67,473,000 | 68,180,000 |
Basic net income (loss) per common share | $ / shares | $ (0.85) | $ 0.89 | $ (1.64) | $ 1.87 |
Diluted net income (loss) per common share | $ / shares | $ (0.85) | $ 0.88 | $ (1.64) | $ 1.84 |
Performance Shares [Member] | ||||
Earnings per share | ||||
Share-based Compensation, Awards Other Than Options, Performance Measurement Period | 3 | 3 |
Derivative Financial Instrume41
Derivative Financial Instruments (Details) - Jun. 30, 2015 | MMBTU$ / EnergyContent$ / Barrelsbbl |
Crude oil | |
Derivative Financial Instruments | |
Portion of Future Oil and Gas Production Being Hedged | 9,700,000 |
Natural Gas [Member] | |
Derivative Financial Instruments | |
Portion of Gas Production Being Hedged | MMBTU | 167,000,000 |
Natural Gas Liquids | |
Derivative Financial Instruments | |
Portion of Future Oil and Gas Production Being Hedged | 9,500,000 |
IF El Paso Permian [Member] | |
Derivative Financial Instruments | |
Index percent of natural gas fixed swaps | 3.00% |
Index percent of natural gas collars | 5.00% |
IF HSC [Member] | |
Derivative Financial Instruments | |
Index percent of natural gas fixed swaps | 93.00% |
Index percent of natural gas collars | 88.00% |
IF NGPL TXOK [Member] | |
Derivative Financial Instruments | |
Index percent of natural gas fixed swaps | 1.00% |
IF NNG Ventura [Member] | |
Derivative Financial Instruments | |
Index percent of natural gas fixed swaps | 3.00% |
Index percent of natural gas collars | 7.00% |
OPIS Ethane Purity Mont Belvieu [Member] | |
Derivative Financial Instruments | |
Index percent of natural gas liquid swaps | 52.00% |
OPIS Propane Mont Belvieu Non-TET [Member] | |
Derivative Financial Instruments | |
Index percent of natural gas liquid swaps | 29.00% |
OPIS Normal Butane Mont Belvieu Non-TET [Member] | |
Derivative Financial Instruments | |
Index percent of natural gas liquid swaps | 10.00% |
OPIS Isobutane Mont Belvieu Non-TET [Member] | |
Derivative Financial Instruments | |
Index percent of natural gas liquid swaps | 9.00% |
Swap | Crude oil | |
Derivative Financial Instruments | |
Portion of Future Oil and Gas Production Being Hedged | 7,961,000 |
Swap | Natural Gas [Member] | |
Derivative Financial Instruments | |
Portion of Gas Production Being Hedged | MMBTU | 159,862,000 |
Swap | Natural Gas Liquids | |
Derivative Financial Instruments | |
Portion of Future Oil and Gas Production Being Hedged | 9,497,000 |
Collar [Member] | Crude oil | |
Derivative Financial Instruments | |
Portion of Future Oil and Gas Production Being Hedged | 1,775,000 |
Collar [Member] | Natural Gas [Member] | |
Derivative Financial Instruments | |
Portion of Gas Production Being Hedged | MMBTU | 7,162,000 |
Third Quarter Current Year [Member] | Swap | Crude oil | |
Derivative Financial Instruments | |
Portion of Future Oil and Gas Production Being Hedged | 1,254,000 |
Weighted-Average Contract Price | $ / Barrels | 90.78 |
Third Quarter Current Year [Member] | Swap | Natural Gas [Member] | |
Derivative Financial Instruments | |
Weighted-Average Contract Price | $ / EnergyContent | 4.03 |
Portion of Gas Production Being Hedged | MMBTU | 12,835,000 |
Third Quarter Current Year [Member] | Swap | Natural Gas Liquids | |
Derivative Financial Instruments | |
Portion of Future Oil and Gas Production Being Hedged | 1,739,000 |
Weighted-Average Contract Price | $ / Barrels | 21.61 |
Third Quarter Current Year [Member] | Collar [Member] | Crude oil | |
Derivative Financial Instruments | |
Portion of Future Oil and Gas Production Being Hedged | 906,000 |
Weighted-Average Floor Price | $ / Barrels | 85 |
Weighted-Average Ceiling Price | $ / Barrels | 91.25 |
Third Quarter Current Year [Member] | Collar [Member] | Natural Gas [Member] | |
Derivative Financial Instruments | |
Portion of Gas Production Being Hedged | MMBTU | 2,005,000 |
Weighted-Average Floor Price | $ / EnergyContent | 4 |
Weighted-Average Ceiling Price | $ / EnergyContent | 4.30 |
Fourth Quarter Current Year [Member] | Swap | Crude oil | |
Derivative Financial Instruments | |
Portion of Future Oil and Gas Production Being Hedged | 1,137,000 |
Weighted-Average Contract Price | $ / Barrels | 90.15 |
Fourth Quarter Current Year [Member] | Swap | Natural Gas [Member] | |
Derivative Financial Instruments | |
Weighted-Average Contract Price | $ / EnergyContent | 4.01 |
Portion of Gas Production Being Hedged | MMBTU | 12,499,000 |
Fourth Quarter Current Year [Member] | Swap | Natural Gas Liquids | |
Derivative Financial Instruments | |
Portion of Future Oil and Gas Production Being Hedged | 1,539,000 |
Weighted-Average Contract Price | $ / Barrels | 21.73 |
Fourth Quarter Current Year [Member] | Collar [Member] | Crude oil | |
Derivative Financial Instruments | |
Portion of Future Oil and Gas Production Being Hedged | 869,000 |
Weighted-Average Floor Price | $ / Barrels | 85 |
Weighted-Average Ceiling Price | $ / Barrels | 92.19 |
Fourth Quarter Current Year [Member] | Collar [Member] | Natural Gas [Member] | |
Derivative Financial Instruments | |
Portion of Gas Production Being Hedged | MMBTU | 5,157,000 |
Weighted-Average Floor Price | $ / EnergyContent | 3.99 |
Weighted-Average Ceiling Price | $ / EnergyContent | 4.29 |
2016 [Member] | Swap | Crude oil | |
Derivative Financial Instruments | |
Portion of Future Oil and Gas Production Being Hedged | 5,570,000 |
Weighted-Average Contract Price | $ / Barrels | 88.01 |
2016 [Member] | Swap | Natural Gas [Member] | |
Derivative Financial Instruments | |
Weighted-Average Contract Price | $ / EnergyContent | 4.13 |
Portion of Gas Production Being Hedged | MMBTU | 45,172,000 |
2016 [Member] | Swap | Natural Gas Liquids | |
Derivative Financial Instruments | |
Portion of Future Oil and Gas Production Being Hedged | 2,017,000 |
Weighted-Average Contract Price | $ / Barrels | 17.70 |
2017 [Member] | Swap | Natural Gas [Member] | |
Derivative Financial Instruments | |
Weighted-Average Contract Price | $ / EnergyContent | 4.19 |
Portion of Gas Production Being Hedged | MMBTU | 34,335,000 |
2017 [Member] | Swap | Natural Gas Liquids | |
Derivative Financial Instruments | |
Portion of Future Oil and Gas Production Being Hedged | 792,000 |
Weighted-Average Contract Price | $ / Barrels | 9.98 |
2018 [Member] | Swap | Natural Gas [Member] | |
Derivative Financial Instruments | |
Weighted-Average Contract Price | $ / EnergyContent | 4.27 |
Portion of Gas Production Being Hedged | MMBTU | 30,606,000 |
2018 [Member] | Swap | Natural Gas Liquids | |
Derivative Financial Instruments | |
Portion of Future Oil and Gas Production Being Hedged | 1,671,000 |
Weighted-Average Contract Price | $ / Barrels | 10.65 |
2019 [Member] | Swap | Natural Gas [Member] | |
Derivative Financial Instruments | |
Weighted-Average Contract Price | $ / EnergyContent | 4.34 |
Portion of Gas Production Being Hedged | MMBTU | 24,415,000 |
2019 [Member] | Swap | Natural Gas Liquids | |
Derivative Financial Instruments | |
Portion of Future Oil and Gas Production Being Hedged | 1,200,000 |
Weighted-Average Contract Price | $ / Barrels | 10.92 |
2020 [Member] | Swap | Natural Gas Liquids | |
Derivative Financial Instruments | |
Portion of Future Oil and Gas Production Being Hedged | 539,000 |
Weighted-Average Contract Price | $ / Barrels | 11.13 |
Derivative Financial Instrume42
Derivative Financial Instruments Fair Value (Details) - USD ($) $ in Thousands | Jun. 30, 2015 | Dec. 31, 2014 | ||
Fair value of derivative assets and liabilities | ||||
Price Risk Derivatives, at Fair Value, Net | $ 391,400 | $ 592,100 | ||
Derivative asset current | 269,022 | 402,668 | ||
Derivative asset noncurrent | 131,464 | 189,540 | ||
Derivative Asset, Fair Value, Gross Asset | 400,486 | 592,208 | ||
Derivative liability, current | 8,107 | 0 | ||
Derivatives liability noncurrent | 1,026 | 70 | ||
Derivative Liability, Fair Value, Gross Liability | 9,133 | 70 | ||
Derivatives not designated as hedging instruments | ||||
Fair value of derivative assets and liabilities | ||||
Derivative asset current | 269,022 | 402,668 | ||
Derivative asset noncurrent | 131,464 | 189,540 | ||
Derivative liability, current | 8,107 | 0 | ||
Derivatives liability noncurrent | 1,026 | 70 | ||
Fair Value, Inputs, Level 2 [Member] | Derivatives not designated as hedging instruments | Fair Value, Measurements, Recurring [Member] | ||||
Fair value of derivative assets and liabilities | ||||
Derivative Asset, Fair Value, Gross Asset | 400,486 | [1] | 592,208 | [2] |
Derivative Liability, Fair Value, Gross Liability | $ 9,133 | [1] | $ 70 | [2] |
[1] | This represents a financial asset or liability that is measured at fair value on a recurring basis. | |||
[2] | This represents a financial asset or liability that is measured at fair value on a recurring basis. |
Derivative Financial Instrume43
Derivative Financial Instruments Gains and Losses (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2015 | Jun. 30, 2014 | Jun. 30, 2015 | Jun. 30, 2014 | ||
Gain and loss from derivative cash settlements and changes in fair value of derivative contracts | |||||
Total Derivative Settlement Gain (Loss) | [1] | $ 112,795 | $ (33,680) | $ 274,024 | $ (62,620) |
Derivative Instruments Not Designated as Hedging Instruments, (Gain) Loss, Net | [2] | 80,929 | 126,469 | (73,238) | 224,131 |
Crude oil | |||||
Gain and loss from derivative cash settlements and changes in fair value of derivative contracts | |||||
Total Derivative Settlement Gain (Loss) | 73,915 | (20,160) | 180,129 | (26,918) | |
Derivative Instruments Not Designated as Hedging Instruments, (Gain) Loss, Net | 66,749 | 93,595 | (7,111) | 125,545 | |
Natural Gas | |||||
Gain and loss from derivative cash settlements and changes in fair value of derivative contracts | |||||
Total Derivative Settlement Gain (Loss) | [3] | 38,880 | (13,472) | 73,112 | (26,876) |
Derivative Instruments Not Designated as Hedging Instruments, (Gain) Loss, Net | 6,070 | 28,154 | (76,269) | 87,615 | |
Gain on Early Settlement of Derivatives | (15,300) | (15,300) | |||
Natural Gas Liquids | |||||
Gain and loss from derivative cash settlements and changes in fair value of derivative contracts | |||||
Total Derivative Settlement Gain (Loss) | 0 | (48) | 20,783 | (8,826) | |
Derivative Instruments Not Designated as Hedging Instruments, (Gain) Loss, Net | $ 8,110 | $ 4,720 | $ 10,142 | $ 10,971 | |
[1] | Total derivative settlement (gain) loss is reported net of the change in accrued settlements between periods in the derivative cash settlements line item on the condensed consolidated statements of cash flows within net cash provided by operating activities. | ||||
[2] | Total derivative (gain) loss is reported in the derivative (gain) loss line item on the condensed consolidated statements of cash flows within net cash provided by operating activities. | ||||
[3] | Natural gas derivative settlements for the three and six months ended June 30, 2015 include a $15.3 million gain on the early settlement of future contracts as a result of divesting of the Company’s Mid-Continent assets during the second quarter of 2015. |
Derivative Financial Instrume44
Derivative Financial Instruments Offsetting of Derivative Assets and Liabilities (Details) - USD ($) $ in Thousands | Jun. 30, 2015 | Dec. 31, 2014 |
Offsetting of Derivative Assets and Liabilities [Abstract] | ||
Derivative Asset, Fair Value, Gross Asset | $ 400,486 | $ 592,208 |
Derivative Asset, Fair Value, Amount Not Offset Against Collateral | (9,133) | (70) |
Derivative Asset, Fair Value, Amount Offset Against Collateral | 391,353 | 592,138 |
Derivative Liability, Fair Value, Gross Liability | (9,133) | (70) |
Derivative Liability, Fair Value, Amount Not Offset Against Collateral | 9,133 | 70 |
Derivative Liability, Fair Value, Amount Offset Against Collateral | $ 0 | $ 0 |
Fair Value Measurements Fair 45
Fair Value Measurements Fair Value (Details) - USD ($) | Jun. 30, 2015 | Dec. 31, 2014 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Derivative Asset, Fair Value, Gross Asset | $ 400,486,000 | $ 592,208,000 | ||
Proved Oil and Gas Property, Successful Effort Method | 7,356,877,000 | 7,348,436,000 | ||
Disposal Group, Including Discontinued Operation, Assets, Current | 7,361,000 | 17,891,000 | ||
Derivative Liability, Fair Value, Gross Liability | 9,133,000 | 70,000 | ||
Net Profits Plan liability | 18,326,000 | 27,136,000 | ||
Asset Retirement Obligations Assets Held-for-sale Noncurrent | 200,000 | |||
Fair Value, Measurements, Recurring [Member] | Fair Value, Inputs, Level 1 [Member] | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Net Profits Plan liability | 0 | [1] | 0 | [2] |
Fair Value, Measurements, Recurring [Member] | Fair Value, Inputs, Level 2 [Member] | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Net Profits Plan liability | 0 | [1] | 0 | [2] |
Fair Value, Measurements, Recurring [Member] | Fair Value, Inputs, Level 3 [Member] | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Net Profits Plan liability | 18,326,000 | [1] | 27,136,000 | [2] |
Fair Value, Measurements, Nonrecurring [Member] | Fair Value, Inputs, Level 1 [Member] | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Proved Oil and Gas Property, Successful Effort Method | 0 | [3] | 0 | [4] |
Disposal Group, Including Discontinued Operation, Assets, Current | 0 | [3] | 0 | [4] |
Fair Value, Measurements, Nonrecurring [Member] | Fair Value, Inputs, Level 2 [Member] | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Proved Oil and Gas Property, Successful Effort Method | 0 | [3] | 0 | [4] |
Disposal Group, Including Discontinued Operation, Assets, Current | 0 | [3] | 0 | [4] |
Fair Value, Measurements, Nonrecurring [Member] | Fair Value, Inputs, Level 3 [Member] | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Proved Oil and Gas Property, Successful Effort Method | 7,700,000 | [3] | 33,400,000 | [4] |
Disposal Group, Including Discontinued Operation, Assets, Current | 5,801,000 | [3] | 17,891,000 | [4] |
Derivatives not designated as hedging instruments | Fair Value, Measurements, Recurring [Member] | Fair Value, Inputs, Level 1 [Member] | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Derivative Asset, Fair Value, Gross Asset | 0 | [1] | 0 | [2] |
Derivative Liability, Fair Value, Gross Liability | 0 | [1] | 0 | [2] |
Derivatives not designated as hedging instruments | Fair Value, Measurements, Recurring [Member] | Fair Value, Inputs, Level 2 [Member] | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Derivative Asset, Fair Value, Gross Asset | 400,486,000 | [1] | 592,208,000 | [2] |
Derivative Liability, Fair Value, Gross Liability | 9,133,000 | [1] | 70,000 | [2] |
Derivatives not designated as hedging instruments | Fair Value, Measurements, Recurring [Member] | Fair Value, Inputs, Level 3 [Member] | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Derivative Asset, Fair Value, Gross Asset | 0 | [1] | 0 | [2] |
Derivative Liability, Fair Value, Gross Liability | $ 0 | [1] | $ 0 | [2] |
[1] | This represents a financial asset or liability that is measured at fair value on a recurring basis. | |||
[2] | This represents a financial asset or liability that is measured at fair value on a recurring basis. | |||
[3] | This represents a non-financial asset or liability that is measured at fair value on a nonrecurring basis. | |||
[4] | This represents a non-financial asset that is measured at fair value on a nonrecurring basis. |
Fair Value Measurements Net Pro
Fair Value Measurements Net Profits Plan (Details) | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2015USD ($)A | Jun. 30, 2014USD ($) | Jun. 30, 2015USD ($)A | Jun. 30, 2014USD ($) | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||
Net Profits Plan liability | $ 27,136,000 | ||||
Net Profits Plan liability | $ 18,326,000 | $ 18,326,000 | |||
Number of Periods Used for Price Assumptions of Strip Prices of Liabilities | A | 5 | 5 | |||
Net Profit Plan liability [Member] | |||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||
Net Profits Plan liability | $ 27,136,000 | ||||
Fair Value, Measurement with Unobservable Inputs Reconciliation, Recurring Basis, Liability, Period Increase (Decrease) | [1] | (1,796,000) | |||
Net settlements (1) (2) | [1],[2] | (7,014,000) | |||
Transfers in (out) of Level 3 | 0 | ||||
Net Profits Plan liability | $ 18,326,000 | $ 18,326,000 | |||
Discount Rate Used to Calculate Currently in Payout Liabilities | 12.00% | 12.00% | |||
Number of Periods Used for Price Assumptions of Strip Prices of Liabilities | 5 | 5 | |||
Period Used for Price Assumptions of Strip Prices for Liabilities | 1 | 1 | |||
Percent Change in Commodity Prices for Sensitivity Analysis | 5.00% | 5.00% | |||
Sensitivity Analysis Change in Liability, Due to Change in Commodity Prices | $ 1,794,000 | $ 1,794,000 | |||
Percent Increase and Decrease in Discount Rate for Sensitivity Analysis | 1.00% | 1.00% | |||
Sensitivity Analysis Change in Liability Due to Change in Discount Rate | $ 650,000 | $ 650,000 | |||
Net Profits Plan [Member] | |||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||
Cash Payments Made or Accrued under Profit Sharing Plan Related to Divestiture Proceeds | $ 3,800,000 | $ 8,500,000 | $ 3,800,000 | $ 8,500,000 | |
[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 amount in the table includes cash payments made or accrued under the Net Profits Plan of $3.8 million for the six-month period ended June 30, 2015, as a result of the divestitures of properties subject to the Net Profits Plan |
Fair Value Measurements Long-te
Fair Value Measurements Long-term Debt (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | |
Jun. 30, 2015 | Jun. 30, 2015 | Dec. 31, 2014 | |
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Unproved Oil and Gas Property, Successful Effort Method | $ 419,903 | $ 419,903 | $ 532,498 |
Disposal Group, Not Discontinued Operation, Loss (Gain) on Write-down | 66,000 | 99,900 | |
6.625% Senior Notes Due 2019 [Member] | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Long-term Debt, Fair Value | 0 | 0 | 350,018 |
6.50% Senior Notes Due 2021 [Member] | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Long-term Debt, Fair Value | 362,250 | 362,250 | 343,000 |
6.125% Senior Notes Due 2022 [Member] | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Long-term Debt, Fair Value | 621,000 | 621,000 | 556,500 |
6.50% Senior Notes Due 2023 [Member] | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Long-term Debt, Fair Value | 412,000 | 412,000 | 379,000 |
5% Senior Notes Due 2024 [Member] | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Long-term Debt, Fair Value | 471,250 | 471,250 | 435,000 |
5.625% Senior Notes Due 2025 [Member] | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Long-term Debt, Fair Value | $ 493,850 | $ 493,850 | $ 0 |
Senior Notes [Member] | 6.625% Senior Notes Due 2019 [Member] | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Debt Instrument, Interest Rate, Stated Percentage | 6.625% | 6.625% | |
Senior Notes [Member] | 6.50% Senior Notes Due 2021 [Member] | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Debt Instrument, Interest Rate, Stated Percentage | 6.50% | 6.50% | |
Senior Notes [Member] | 6.125% Senior Notes Due 2022 [Member] | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Debt Instrument, Interest Rate, Stated Percentage | 6.125% | 6.125% | |
Senior Notes [Member] | 6.50% Senior Notes Due 2023 [Member] | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Debt Instrument, Interest Rate, Stated Percentage | 6.50% | 6.50% | |
Senior Notes [Member] | 5% Senior Notes Due 2024 [Member] | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Debt Instrument, Interest Rate, Stated Percentage | 5.00% | 5.00% | |
Senior Notes [Member] | 5.625% Senior Notes Due 2025 [Member] | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Debt Instrument, Interest Rate, Stated Percentage | 5.625% | 5.625% | |
Fair Value, Measurements, Nonrecurring [Member] | Fair Value, Inputs, Level 3 [Member] | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Unproved Oil and Gas Property, Successful Effort Method | $ 0 | $ 0 |
Fair Value Measurements Proved
Fair Value Measurements Proved and Unproved Oil and Gas Properties (Details) $ in Thousands | 3 Months Ended | 6 Months Ended | ||||||
Jun. 30, 2015USD ($)A | Jun. 30, 2014USD ($) | Jun. 30, 2015USD ($)A | Jun. 30, 2014USD ($) | Dec. 31, 2014USD ($) | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||||||
Discount Rate Used for Fair Value of Oil and Gas Properties | 12.00% | 12.00% | ||||||
Number of Periods Used for Price Assumptions of Strip Prices of Liabilities | A | 5 | 5 | ||||||
Impairment of Oil and Gas Properties | $ 12,914 | $ 0 | $ 68,440 | $ 0 | ||||
Proved Oil and Gas Property, Successful Effort Method | 7,356,877 | 7,356,877 | $ 7,348,436 | |||||
Disposal Group, Not Discontinued Operation, Loss (Gain) on Write-down | 66,000 | 99,900 | ||||||
Abandonment and impairment of unproved properties | 5,819 | $ 164 | 17,446 | $ 2,965 | ||||
Unproved Oil and Gas Property, Successful Effort Method | 419,903 | 419,903 | 532,498 | |||||
Fair Value, Measurements, Nonrecurring [Member] | Fair Value, Inputs, Level 3 [Member] | ||||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||||||
Proved Oil and Gas Property, Successful Effort Method | 7,700 | [1] | 7,700 | [1] | $ 33,400 | [2] | ||
Unproved Oil and Gas Property, Successful Effort Method | $ 0 | $ 0 | ||||||
[1] | This represents a non-financial asset or liability that is measured at fair value on a nonrecurring basis. | |||||||
[2] | This represents a non-financial asset that is measured at fair value on a nonrecurring basis. |
Suspended Well Costs (Details)
Suspended Well Costs (Details) - Jun. 30, 2015 - USD ($) $ in Millions | Total | Total |
Suspended Well Costs [Abstract] | ||
Capitalized Exploratory Well Cost, Charged to Expense | $ (6) | $ (21.1) |