Fair Value Measurements

9 Months Ended

Sep. 30, 2011


Note 4	Fair Value Measurements

The following table sets forth, by level within the fair value hierarchy, our financial assets and liabilities that are accounted for at fair value on a recurring basis as of September 30, 2011. Our debt securities could transfer into or out of a Level 1 or 2 measure depending on the availability of independent and current pricing at the end of each quarter. During the three months ended September 30, 2011, there were no transfers of our financial assets and liabilities between Level 1 and 2 measures. Our financial assets and liabilities are classified in their entirety based on the lowest level of input that is significant to the fair value measurement.

Recurring Fair Value Measurements


	Fair Value as of September 30, 2011
	Level 1		Level 2		Level 3		Total
	(In thousands)

Assets:
Short-term investments:
Available-for-sale equity securities — energy industry	$	56,654	$	—	$	—	$	56,654
Available-for-sale debt securities
Commercial paper and CDs		1,160		—		—		1,160
Corporate debt securities		—		44,600		—		44,600
Mortgage-backed debt securities		—		367		—		367
Mortgage-CMO debt securities		—		2,797		—		2,797
Asset-backed debt securities		2,705		—		—		2,705
Trading securities — energy industry		11,576		—		—		11,576

Total short-term investments	$	72,095	$	47,764	$	—	$	119,859

Liabilities:
Derivative contract	$	—	$	1,900	$	—	$	1,900

Nonrecurring Fair Value Measurements

Fair value measurements were applied with respect to our nonfinancial assets and liabilities measured on a nonrecurring basis, which would consist of measurements primarily to goodwill, oil and gas financing receivables, intangible assets and other long-lived assets, assets acquired and liabilities assumed in a business combination, and asset retirement obligations.

Fair Value of Financial Instruments

The fair value of our financial instruments has been estimated in accordance with GAAP. The fair value of our long-term debt and subsidiary preferred stock is estimated based on quoted market prices or prices quoted from third-party financial institutions. The carrying and fair values of these liabilities were as follows:


	September 30, 2011				December 31, 2010
	Carrying Value		Fair Value		Carrying Value		Fair Value
	(In thousands)

5.375% senior notes due August 2012(1)	$	274,448	$	284,952	$	273,977	$	291,500
6.15% senior notes due February 2018		967,186		1,078,984		966,276		1,041,008
9.25% senior notes due January 2019		1,125,000		1,438,864		1,125,000		1,393,943
5.00% senior notes due September 2020		697,266		721,070		697,037		678,335
4.625% senior notes due September 2021		697,607		687,253		—		—
0.94% senior exchangeable notes due May 2011		—		—		1,378,178		1,403,315
Subsidiary preferred stock		69,188		68,625		69,188		68,625
Revolving credit facilities		600,000		600,000		—		—
Other		1,853		1,853		2,676		2,676

	$	4,432,548	$	4,881,601	$	4,512,332	$	4,879,402


(1)		Includes $.4 million and $.7 million as of September 30, 2011 and December 31, 2010, respectively, related to the unamortized loss on an interest rate swap that was unwound during the fourth quarter of 2005.

The fair values of our cash equivalents, trade receivables and trade payables approximate their carrying values due to the short-term nature of these instruments.

As of September 30, 2011, our short-term investments were carried at fair market value and included $108.3 million and $11.6 million in securities classified as available-for-sale and trading, respectively. As of December 31, 2010, our short-term investments were carried at fair market value and included $139.9 million and $19.6 million in securities classified as available-for-sale and trading, respectively. The carrying value of our long-term investments that are accounted for using the equity method of accounting approximates fair value. The fair value of these long-term investments totaled $6.0 million and $7.4 million as of September 30, 2011 and December 31, 2010, respectively. The carrying value of our oil and gas financing receivables included in long-term investments approximates fair value. The carrying value of our oil and gas financing receivables totaled $34.4 million and $32.9 million as of September 30, 2011 and December 31, 2010, respectively. Income and gains associated with our oil and gas financing receivables are recognized as operating revenues.

- Definition

The entire disclosure for the fair value of financial instruments (as defined), including financial assets and financial liabilities (collectively, as defined), and the measurements of those instruments as well as disclosures related to the fair value of non-financial assets and liabilities. Such disclosures about the financial instruments, assets, and liabilities would include: (1) the fair value of the required items together with their carrying amounts (as appropriate); (2) for items for which it is not practicable to estimate fair value, disclosure would include: (a) information pertinent to estimating fair value (including, carrying amount, effective interest rate, and maturity, and (b) the reasons why it is not practicable to estimate fair value; (3) significant concentrations of credit risk including: (a) information about the activity, region, or economic characteristics identifying a concentration, (b) the maximum amount of loss the entity is exposed to based on the gross fair value of the related item, (c) policy for requiring collateral or other security and information as to accessing such collateral or security, and (d) the nature and brief description of such collateral or security; (4) quantitative information about market risks and how such risks are managed; (5) for items measured on both a recurring and nonrecurring basis information regarding the inputs used to develop the fair value measurement; and (6) for items presented in the financial statement for which fair value measurement is elected: (a) information necessary to understand the reasons for the election, (b) discussion of the effect of fair value changes on earnings, (c) a description of [similar groups] items for which the election is made and the relation thereof to the balance sheet, the aggregate carrying value of items included in the balance sheet that are not eligible for the election; (7) all other required (as defined) and desired information.

+ References

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