Fair Value (Tables)

12 Months Ended

Dec. 31, 2012

Derivative instruments carried at fair value

The following table presents the financial instruments carried at fair value as of December 31, 2012 and 2011, and by the valuation hierarchy (in thousands):

As of December 31, 2012	Assets		Liabilities

Significant other observable inputs (Level 2)
Commodity contracts	$	8,441	$	(15,970	)
Significant unobservable inputs (Level 3)
Commodity contracts		15,795		(3,346	)
Embedded derivatives in commodity contracts		6,146		(40,103	)

Total carrying value in Consolidated Balance Sheet	$	30,382	$	(59,419	)

As of December 31, 2011	Assets		Liabilities

Significant other observable inputs (Level 2)
Commodity contracts	$	5,063	$	(79,358	)
Significant unobservable inputs (Level 3)
Commodity contracts		12,210		(15,175	)
Embedded derivatives in commodity contracts		7,517		(61,421	)

Total carrying value in Consolidated Balance Sheet	$	24,790	$	(155,954	)

Summary of significant unobservable inputs used in the valuation of Level 3 instruments

Level 3 Instrument	Balance Sheet Classification	Unobservable Inputs	Value Range	Time Period

Commodity contracts	Assets	Forward propane prices (per gallon)	$0.91 - $1.01	Jan. 2013 - Dec. 2014
		Forward isobutane prices (per gallon)	$1.70 - $1.76	Mar. 2013 - Mar. 2014
		Forward normal butane prices (per gallon)	$1.52 - $1.62	Mar. 2013 - Dec. 2014
		Forward natural gasoline prices (per gallon)	$1.97 - $2.21	Jan. 2013 - Dec. 2014
		Crude option volatilities (%)	15.12% - 29.71%	Jan. 2013 - Dec. 2014
	Liabilities	Forward propane prices (per gallon)	$0.91 - $0.92	Jan. 2013 - Mar. 2013
		Forward isobutane prices (per gallon)	$1.70 - $1.84	Jan. 2013 - Dec. 2014
		Forward normal butane prices (per gallon)	$1.52 - $1.73	Jan. 2013 - Dec. 2013
		Forward natural gasoline prices (per gallon)	$2.04 - $2.21	Jan. 2013 - Dec. 2013
		Crude option volatilities (%)	15.05% - 30.17%	Jan. 2013 - Dec. 2013
Embedded derivatives in commodity contracts	Asset	ERCOT Pricing (per MegaWatt Hour)(1)	$28.79 - $62.10	Jan. 2013 - Dec. 2014
	Liability	Forward propane prices (per gallon)	$0.91 - $1.01	Jan. 2013 - Dec. 2022
		Forward isobutane prices (per gallon)	$1.60 - $1.84	Jan. 2013 - Dec. 2022
		Forward normal butane prices (per gallon)	$1.44 - $1.73	Jan. 2013 - Dec. 2022
		Forward natural gasoline prices (per gallon)	$1.84 - $2.21	Jan. 2013 - Dec. 2022
		Forward natural gas prices (per mmbtu)	$3.33 - $6.22	Jan. 2013 - Dec. 2022
		Probability of renewal(2)	0%

(1): The forward ERCOT prices utilized in the valuations are generally increasing over time with a seasonal spike in pricing in the summer months.
(2): The producer counterparty to the embedded derivative has the option to renew the gas purchase agreement and the related keep-whole processing agreement for two successive five year terms after 2022. The embedded gas purchase agreement cannot be renewed without the renewal of the related keep-whole processing agreement. Due to the significant number of years until the renewal options are exercisable and the high level of uncertainty regarding the counterparty's future business strategy, the future commodity price environment, and the future competitive environment for midstream services in the Appalachia area, management determined that a 0% probability of renewal is an appropriate assumption.

Roll forward of the balance sheet amounts for assets and liabilities classified within Level 3 of the valuation hierarchy

The tables below include a rollforward of the balance sheet amounts for the years ended December 31, 2012 and 2011 (including the change in fair value) for assets and liabilities classified by the Partnership within Level 3 of the valuation hierarchy (in thousands):

	Year Ended December 31, 2012

	Commodity Derivative Contracts (net)			Embedded Derivatives in Commodity Contracts (net)
Fair value at beginning of period	$	(2,965	)	$	(53,904	)
Total gain or loss (realized and unrealized) included in earnings(1)		17,153			9,199
Settlements		(1,739	)		10,748

Fair value at end of period	$	12,449		$	(33,957	)

The amount of total gains or losses for the period included in earnings attributable to the change in unrealized gains or losses relating to assets still held at end of period	$	8,213		$	8,175

	Year Ended December 31, 2011

	Commodity Derivative Contracts (net)			Embedded Derivatives in Commodity Contracts (net)
Fair value at beginning of period	$	(14,357	)	$	(34,936	)
Total gain or loss (realized and unrealized) included in earnings(1)		3,182			(30,827	)
Settlements		8,210			11,859

Fair value at end of period	$	(2,965	)	$	(53,904	)

The amount of total gains or losses for the period included in earnings attributable to the change in unrealized gains or losses relating to assets still held at end of period	$	6,241		$	(29,556	)

(1): Gains and losses on Commodity Derivative Contracts classified as Level 3 are recorded in Derivative (loss) gain related to revenue. Gains and losses on Embedded Derivatives in Commodity Contracts are recorded in Purchased product costs, Derivative loss related to purchased product costs and Derivative gain related to facility expenses.