Derivatives (Tables)

6 Months Ended

Jun. 30, 2011

Notes To Financial Statements [Abstract]

The following table summarizes open positions as of June 30, 2011, and represents, as of such date, derivatives in place through December 31, 2016, on annual production volumes:

	July 1 - December 31, 2011			2012			2013			2014			2015			2016
Natural gas positions:
Fixed price swaps:
Hedged volume (MMMBtu)		15,950			49,410			57,067			66,156			75,190			18,300
Average price ($/MMBtu)	$	9.50		$	5.97		$	5.88		$	5.86		$	5.90		$	6.01
Puts:
Hedged volume (MMMBtu)		9,699			25,364			25,295			23,178			23,178			-
Average price ($/MMBtu)	$	5.97		$	6.25		$	6.25		$	5.00		$	5.00		$	-
PEPL puts: (1)
Hedged volume (MMMBtu)		6,630			-			-			-			-			-
Average price ($/MMBtu)	$	8.50		$	-		$	-		$	-		$	-		$	-
Total:
Hedged volume (MMMBtu)		32,279			74,774			82,362			89,334			98,368			18,300
Average price ($/MMBtu)	$	8.24		$	6.07		$	6.00		$	5.64		$	5.69		$	6.01

Oil positions:
Fixed price swaps: (2)
Hedged volume (MBbls)		2,932			7,741			8,413			9,034			9,216			549
Average price ($/Bbl)	$	91.82		$	94.67		$	98.27		$	95.39		$	98.18		$	100.58
Puts:
Hedged volume (MBbls)		1,176			2,196			2,190			-			-			-
Average price ($/Bbl)	$	75.00		$	75.00		$	75.00		$	-		$	-		$	-
Collars:
Hedged volume (MBbls)		138			-			-			-			-			-
Average floor price ($/Bbl)	$	90.00		$	-		$	-		$	-		$	-		$	-
Average ceiling price ($/Bbl)	$	112.25		$	-		$	-		$	-		$	-		$	-
Total:
Hedged volume (MBbls)		4,246			9,937			10,603			9,034			9,216			549
Average price ($/Bbl)	$	87.10		$	90.33		$	93.46		$	95.39		$	98.18		$	100.58

Natural gas basis differential positions:
PEPL basis swaps: (1)
Hedged volume (MMMBtu)		17,770			37,735			38,854			42,194			42,194			-
Hedged differential ($/MMBtu)	$	(0.96	)	$	(0.89	)	$	(0.89	)	$	(0.39	)	$	(0.39	)	$	-

Oil timing differential positions:
Trade month roll swaps: (3)
Hedged volume (MBbls)		1,380			5,490			5,475			5,475			-			-
Hedged differential ($/Bbl)	$	0.22		$	0.22		$	0.22		$	0.22		$	-		$	-

(1)	Settle on the Panhandle Eastern Pipeline ("PEPL") spot price of natural gas to hedge basis differential associated with natural gas production in the Mid-Continent Deep and Mid-Continent Shallow regions.

(2)

As presented in the table above, the Company has certain outstanding fixed price oil swaps on 1,000 Bbls of daily production for the year ending December 31, 2015, 14,750 Bbls of daily production for the years ending December 31, 2016, and December 31, 2017, and 13,750 Bbls of daily production for the year ending December 31, 2018, which may be extended annually at a price of $100.00 per Bbl if the counterparties determine that the strike prices are in-the-money on a designated date in each respective preceding year. The extension for each year is exercisable without respect to the other years.

(3)

The Company hedges the timing risk associated with the sales price of oil in the Mid-Continent Deep, Mid-Continent Shallow and Permian Basin regions. In these regions, the Company generally sells oil for the delivery month at a sales price based on the average NYMEX price of light oil during that month, plus an adjustment calculated as a spread between the weighted average prices of the delivery month, the next month and the following month during the period when the delivery month is prompt (the "trade month roll"). The 2011 swaps hedge production volumes for October through December.

Fair Value of Derivatives Outstanding on a Gross Basis by Location on the Balance Sheet

The following summarizes the fair value of derivatives outstanding on a gross basis:

	June 30, 2011		December 31, 2010
	(in thousands)
Assets:
Commodity derivatives	$	440,485	$	637,836

Liabilities:
Commodity derivatives	$	470,024	$	398,902

Gains and Losses on Derivative Instruments

The following presents the Company's reported gains and losses on derivative instruments:

	Three Months Ended June 30,					Six Months Ended June 30,
	2011		2010			2011			2010
	(in thousands)
Realized gains (losses):
Commodity derivatives	$	42,081	$	83,160		$	97,890		$	145,663
Interest rate swaps		-		-			-			(8,021	)
Canceled derivatives		-		(74,275	)		-			(74,275	)
	$	42,081	$	8,885		$	97,890		$	63,367
Unrealized gains (losses):
Commodity derivatives	$	163,434	$	40,631		$	(261,851	)	$	74,131
Interest rate swaps		-		41,030			-			25,889
	$	163,434	$	81,661		$	(261,851	)	$	100,020
Total gains (losses):
Commodity derivatives	$	205,515	$	123,791		$	(163,961	)	$	219,794
Interest rate swaps		-		(33,245	)		-			(56,407	)
	$	205,515	$	90,546		$	(163,961	)	$	163,387