2.2.0.25falsefalse10801 - Disclosure - Commitments and Contingenciestruefalsefalse1falsefalseUSDfalsefalse1/1/2011 - 3/31/2011 USD ($) USD ($) / shares $Duration_1_1_2011_To_3_31_2011http://www.sec.gov/CIK0001060990duration2011-01-01T00:00:002011-03-31T00:00:00Unit12Standardhttp://www.xbrl.org/2003/iso4217USDiso42170Unit13Dividehttp://www.xbrl.org/2003/iso4217USDiso4217http://www.xbrl.org/2003/instancesharesxbrli0USDUSD$2true0us-gaap_LossContingencyAbstractus-gaaptruenadurationNo definition available.falsefalsefalsefalsefalsefalsefalsefalsefalsefalse1falsefalsefalse00falsefalsefalsefalsefalseOtherxbrli:stringItemTypestringNo definition available.falsefalseCommitments and Contingencies3false0us-gaap_CommitmentsAndContingenciesDisclosureTextBlockus-gaaptruenadurationNo definition available.falsefalsefalsefalsefalsefalsefalsefalsefalsefalseterselabel1falsefalsefalse00<div> <div> <div style="font-family: 'Times New Roman',Times,serif;"> <div style="margin-top: 12pt; font-size: 10pt;" align="left"><b>8. COMMITMENTS AND CONTINGENCIES</b> </div> <div style="margin-top: 6pt; font-size: 10pt;" align="left"><i>Contractual Obligations and Commitments</i> </div> <div style="margin-top: 6pt; font-size: 10pt;" align="left">     There have been no significant changes to our contractual obligations and commitments as reported in our 2010 Annual Report except for a series of contracts with NOVA Gas Transmission Ltd. ("NGTL"), a subsidiary of TransCanada Pipelines Limited, for the construction of a pipeline and meter station (the "project") that will serve our Horn River Asset.  Under these agreements, we agreed to provide financial assurances in the form of letters of credit to NGTL during the construction phase, which is expected to continue through 2014.  Assuming the project is fully constructed and based on estimated costs of C$295 million, including taxes of C$30 million, we expect to provide cumulative letters of credit as follows: </div></div> <div style="font-family: 'Times New Roman',Times,serif;"> <div align="center"> <table style="font-size: 10pt;" border="0" cellspacing="0" cellpadding="0" width="40%"> <tr valign="bottom"><td width="88%"> </td> <td width="5%"> </td> <td width="1%"> </td> <td width="5%"> </td> <td width="1%"> </td></tr> <tr style="font-size: 8pt;" valign="bottom"><td> </td> <td> </td> <td colspan="2" nowrap="nowrap" align="center"><b>NGTL</b></td> <td> </td></tr> <tr style="font-size: 8pt;" valign="bottom"><td> </td> <td> </td> <td colspan="2" nowrap="nowrap" align="center"><b>Cumulative</b></td> <td> </td></tr> <tr style="font-size: 8pt;" valign="bottom"><td> </td> <td> </td> <td colspan="2" nowrap="nowrap" align="center"><b>Financial</b></td> <td> </td></tr> <tr style="font-size: 8pt;" valign="bottom"><td> </td> <td> </td> <td style="border-bottom: #000000 1px solid;" colspan="2" nowrap="nowrap" align="center"><b>Assurances</b></td> <td> </td></tr> <tr style="font-size: 8pt;" valign="bottom"><td> </td> <td> </td> <td colspan="2" align="center">(C$ in thousands)</td> <td> </td></tr> <tr style="background: #cceeff;" valign="bottom"><td> <div style="text-indent: -15px; margin-left: 15px;">April 16, 2011</div></td> <td> </td> <td align="right">$</td> <td align="right">14,750</td> <td> </td></tr> <tr valign="bottom"><td> <div style="text-indent: -15px; margin-left: 15px;">June 1, 2011</div></td> <td> </td> <td align="right">$</td> <td align="right">32,450</td> <td> </td></tr> <tr style="background: #cceeff;" valign="bottom"><td> <div style="text-indent: -15px; margin-left: 15px;">March 1, 2012</div></td> <td> </td> <td align="right">$</td> <td align="right">67,850</td> <td> </td></tr> <tr valign="bottom"><td> <div style="text-indent: -15px; margin-left: 15px;">October 1, 2012</div></td> <td> </td> <td align="right">$</td> <td align="right">109,150</td> <td> </td></tr> <tr style="background: #cceeff;" valign="bottom"><td> <div style="text-indent: -15px; margin-left: 15px;">July 1, 2013</div></td> <td> </td> <td align="right">$</td> <td align="right">147,500</td> <td> </td></tr> <tr valign="bottom"><td> <div style="text-indent: -15px; margin-left: 15px;">October 1, 2013</div></td> <td> </td> <td align="right">$</td> <td align="right">295,000</td> <td> </td></tr></table></div> <div style="margin-top: 6pt; font-size: 10pt;" align="left">     Should other companies subscribe to the project, then our financial assurances under the agreements will be reduced.  If the project is terminated by NGTL, then we would be responsible for all of the costs incurred or for which NGTL is liable, and we would have the option to purchase NGTL's rights in the project for a nominal fee.  If the project is terminated by NGTL after June 2011, then we would also be required to pay NGTL an additional C$26.4 million.  No amounts have been recognized on our consolidated balance sheet as of March 31, 2011.  Upon completion of the project, all construction-related guarantees will expire.  </div> <div style="margin-top: 6pt; font-size: 10pt;" align="left">     We have also entered into agreements to deliver production from our Horn River Asset to NGTL over a ten-year period.  These agreements will be extended in the event NGTL has either not received 1 Tcf of gas from us and other third parties, or recovered its costs as of the end of the ten-year period.  In such event, the extension will be for delivery of minimum volumes of 106 MMcfd.  </div> <div style="margin-top: 6pt; font-size: 10pt;" align="left">     Also under the agreements, we are required to treat the gas to meet NGTL pipeline specifications.  Such treatment will require us to construct treating facilities.  We will develop our plans to address the treating requirements prior to the commissioning of the assets being constructed by NGTL.  </div> <div style="margin-top: 12pt; font-size: 10pt;" align="left"><i>Contingencies</i> </div> <div style="margin-top: 6pt; font-size: 10pt;" align="left">     On March 10, 2011, the Court granted our motions for summary judgment on Eagle's remaining tort claims, but directed further briefing on choice of law issues after which the Court will consider a motion for reconsideration of the summary judgment motions.  The Court denied Eagle's summary judgment motion on our contract claims on March 31, 2011.  </div> <div style="margin-top: 6pt; font-size: 10pt;" align="left">     Note 14 to the consolidated financial statements in our 2010 Annual Report on Form 10-K contains a more complete description of our contractual obligations, commitments and contingencies for which there are no other significant updates during the quarter ended March 31, 2011.  </div></div></div> </div>8. 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