Fair Value Measurements (Tables)

6 Months Ended

Jun. 30, 2013

Fair Value Disclosures [Abstract]

Fair value hierarchy for financial instruments measured at fair value on a recurring basis

The fair value hierarchy for our financial assets and liabilities is shown by the following table:

	As of June 30, 2013								As of December 31, 2012
	Derivative assets			Derivative liabilities			Net assets (liabilities)		Derivative assets			Derivative liabilities			Net assets (liabilities)
Significant other observable inputs (Level 2)	$	14,255		$	(2,711	)	$	11,544	$	18,599		$	(4,425	)	$	14,174
Significant unobservable inputs (Level 3)	31,311			(358		)	30,953		27,411			(1,180		)	26,231
Netting adjustments (1)	(2,756		)	2,756			—		(2,977		)	2,977			—
	$	42,810		$	(313	)	$	42,497	$	43,033		$	(2,628	)	$	40,405

___________

(1) Amounts represent the impact of master netting agreements that allow us to net settle positive and negative positions with the same counterparty.

Level 3 rollforward

Changes in the fair value of our derivative instruments classified as Level 3 in the fair value hierarchy during the six months ended June 30, 2013 and 2012 were: 

	For the six months ended June 30,
Net derivative assets	2013			2012
Beginning balance	$	26,231		$	5,049
Realized and unrealized gains included in non-hedge derivative gains	15,614			37,206
Purchases	664			—
Settlements received	(11,556		)	(2,632		)
Ending balance	$	30,953		$	39,623
Gains relating to instruments still held at the reporting date included in non-hedge derivative gains for the period	$	18,651		$	35,232

Fair value of other financial instruments

Our significant financial instruments, other than derivatives, consist primarily of cash and cash equivalents, accounts receivable, accounts payable, and long-term debt. We believe the carrying values of cash and cash equivalents, accounts receivable, and accounts payable approximate fair values due to the short-term maturities of these instruments.

The carrying value and estimated fair value of our long-term debt at June 30, 2013 and December 31, 2012 were as follows:

	June 30, 2013				December 31, 2012
Level 2	Carrying value		Estimated fair value		Carrying value		Estimated fair value
9.875% Senior Notes due 2020	$	294,286	$	342,210	$	294,031	$	341,250
8.25% Senior Notes due 2021	400,000		419,680		400,000		434,000
7.625% Senior Notes due 2022	556,169		557,938		556,631		574,750
Senior secured revolving credit facility	93,000		93,000		25,000		25,000
Other secured long-term debt	16,767		16,767		17,740		17,740
	$	1,360,222	$	1,429,595	$	1,293,402	$	1,392,740

The fair value of our Senior Notes was estimated based on quoted market prices. The carrying value of our senior secured revolving credit facility approximates fair value because it has a variable interest rate and incorporates a measure of our credit risk. The carrying value of our other secured long-term debt approximates fair value because the rates are comparable to those at which we could currently borrow under similar terms.

Offsetting Assets and Liabilities

The following table summarizes our derivative assets and liabilities which are offset in the balance sheet under our master netting agreements. It also reflects the amounts outstanding under our senior secured revolving credit facility that are available to offset our net derivative assets due from counterparties that are lenders under our senior secured revolving credit facility.

	Offset in the consolidated balance sheets									Gross amounts not offset in the consolidated balance sheets
	Gross assets (liabilities)			Offsetting assets (liabilities)			Net assets (liabilities)			Amounts outstanding under senior secured revolving credit facility			Net amount
As of June 30, 2013
Derivative assets	$	45,566		$	(2,950	)	$	42,616		$	(26,169	)	$	16,447
Derivative liabilities	(3,069		)	2,950			(119		)	—			(119		)
	$	42,497		$	—		$	42,497		$	(26,169	)	$	16,328
As of December 31, 2012
Derivative assets	$	46,010		$	(4,721	)	$	41,289		$	(9,180	)	$	32,109
Derivative liabilities	(5,605		)	4,721			(884		)	—			(884		)
	$	40,405		$	—		$	40,405		$	(9,180	)	$	31,225