DERIVATIVE INSTRUMENTS AND PRICE RISK MANAGEMENT (Tables)

9 Months Ended

Sep. 30, 2012

DERIVATIVE INSTRUMENTS AND PRICE RISK MANAGEMENT [Abstract]

Open Commodity Swap Contracts

The following table reflects open commodity swap contracts as of September 30, 2012, the associated volumes and the corresponding weighted average NYMEX reference price.

Settlement Period	Oil (Barrels)		Fixed Price		Weighted Avg NYMEX Reference Price
Oil Swaps
10/01/12 – 12/31/12		60,000	$	90.40	$	92.73
10/01/12 – 12/31/14		540,000		91.65		92.61
10/01/12 – 12/31/12		60,000		97.80		92.21
10/01/12 – 12/31/12		30,000		104.50		92.75
10/01/12 – 12/31/12		150,000		88.00		92.73
10/01/12 – 12/31/12		142,500		95.15		92.72
10/01/12 – 12/31/12		60,000		100.00		92.74
01/01/13 – 12/31/13		300,000		89.50		93.61
01/01/13 – 12/31/13		240,000		91.10		93.70
07/01/13 – 12/31/13		60,000		102.30		93.51
01/01/14 – 6/30/14		300,000		89.50		92.03
01/01/14 – 6/30/14		240,000		90.00		92.44
01/01/14 – 12/31/14		240,000		90.15		91.49
01/01/14 – 12/31/14		240,000		91.00		91.49
01/01/14 – 06/30/14		240,000		100.00		92.46
07/01/14 – 12/31/14		120,000		90.00		90.87
07/01/14 – 12/31/14		120,000		93.50		90.90

Open costless collar futures agreements

In addition to the open commodity swap contracts the Company has entered into costless collars.  The costless collars are used to establish floor and ceiling prices on anticipated crude oil production. There were no premiums paid or received by the Company related to the costless collar agreements.  The following table reflects open costless collar agreements as of September 30, 2012.

Term	Oil (Barrels)		Price		Basis
Costless Collars
10/01/12 – 12/31/12		60,000	$	90.00/$98.50		NYMEX
10/01/12 – 12/31/12		33,308	$	85.00/$95.25		NYMEX
10/01/12 – 12/31/12		60,000	$	95.00/$115.10		NYMEX
10/01/12 – 12/31/13		199,026	$	90.00/$103.50		NYMEX
10/01/12 – 12/31/13		188,018	$	90.00/$106.50		NYMEX
10/01/12 – 12/31/13		292,580	$	90.00/$110.00		NYMEX
10/01/12 – 12/31/13		247,683	$	95.00/$107.00		NYMEX
01/01/13 – 12/31/13		480,000	$	95.00/$110.70		NYMEX
01/01/13 – 12/31/13		760,794	$	85.00/$98.00		NYMEX
07/01/13 – 12/31/13		96,000	$	95.00/$106.90		NYMEX
01/01/14 – 12/31/14		240,000	$	90.00/$99.05		NYMEX

Derivatives Instruments Balance Sheet Location

At September 30, 2012 and December 31, 2011, the Company had derivative financial instruments recorded on the balance sheet as set forth below:

Type of Contract	Balance Sheet Location	September 30, 2012 Estimated Fair Value			December 31, 2011 Estimated Fair Value
Derivative Assets:
Swap Contracts	Current assets/liabilities	$	1,733,586		$	285,126
Swap Contracts	Non-current assets		2,502,317			-
Costless Collars	Current assets/liabilities		12,395,866			1,932,884
Costless Collars	Non-current asset/liabilities		7,615,509			8,766,484
Total Derivative Assets		$	24,247,278		$	10,984,494
Derivative Liabilities:
Swap Contracts	Current assets/liabilities	$	(2,592,475	)	$	(8,383,588	)
Swap Contracts	Non-current assets		(2,635,325	)		-
Costless Collars	Current assets/liabilities		(7,531,366	)		(3,197,490	)
Costless Collars	Non-current assets/liabilities		(5,198,846	)		(11,341,387	)
Total Derivative Liabilities			(17,958,012	)	$	(22,922,465	)

Gain (Loss) in Statement of Income

The following disclosures are applicable to the Company's financial statements, as of September 30, 2012 and 2011:

	Location of Loss for Effective and	Amount of Loss Reclassified from AOCI into Income
	Ineffective Portion of Derivative	Three Months Ended September 30,				Nine Months Ended September 30,
Derivative Type	In Income	2012		2011		2012		2011
Commodity - Cash Flow	Loss on Settled Derivatives	$	-	$	295,950	$	101,309	$	849,900