2.2.0.25falsefalse0211 - Disclosure - Commitments and contingenciestruefalsefalse1falsefalseUSDfalsefalse1/1/2010 - 12/31/2010
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USD ($) / shares
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<!-- Begin Block Tagged Note 11 - us-gaap:CommitmentsAndContingenciesDisclosureTextBlock-->
<div style="font-family: 'Times New Roman',Times,serif">
<div align="justify" style="font-size: 10pt; margin-top: 12pt"><b>Note K. </b><b><i>Commitments and contingencies</i></b>
</div>
<div align="justify" style="font-size: 10pt; margin-top: 10pt">        <b><i>Severance agreements. </i></b>The Company has entered into severance and change in control agreements
with all of its senior officers. The current annual salaries for the Company’s officers covered
under such agreements total approximately $3.4 million.
</div>
<div align="justify" style="font-size: 10pt; margin-top: 10pt">        <b><i>Indemnifications</i></b><b>. </b>The Company has agreed to indemnify its directors and officers, with
respect to claims and damages arising from certain acts or omissions taken in such capacity.
</div>
<div align="justify" style="font-size: 10pt; margin-top: 10pt">        <b><i>Legal actions</i></b><b>. </b>The Company is a party to proceedings and claims incidental to its business.
While many of these matters involve inherent uncertainty, the Company believes that the amount of
the liability, if any, ultimately incurred with respect to any such proceedings or claims will not
have a material adverse effect on the Company’s consolidated financial position as a whole or on
its liquidity, capital resources or future results of operations. The Company will continue to
evaluate proceedings and claims involving the Company on a quarter-by-quarter basis and will
establish and adjust any reserves as appropriate to reflect its assessment of the then current
status of the matters.
</div>
<div align="justify" style="font-size: 10pt; margin-top: 10pt">        <b><i>Daywork commitments. </i></b>The Company periodically enters into contractual arrangements under
which the Company is committed to expend funds to drill wells in the future, including agreements
to secure drilling rig services, which require the Company to make future minimum payments to the
rig operators. The Company records drilling commitments in the
periods in which well capital is incurred or rig services are provided. The following table summarizes the Company’s future
drilling commitments at December 31, 2010:
</div>
<div align="center">
<table style="font-size: 9pt; text-align: left" cellspacing="0" border="0" cellpadding="0" width="99%">
<!-- Begin Table Head -->
<tr valign="bottom">
<td width="40%"> </td>
<td width="3%"> </td>
<td width="1%"> </td>
<td width="7%"> </td>
<td width="1%"> </td>
<td width="3%"> </td>
<td width="1%"> </td>
<td width="7%"> </td>
<td width="1%"> </td>
<td width="3%"> </td>
<td width="1%"> </td>
<td width="7%"> </td>
<td width="1%"> </td>
<td width="3%"> </td>
<td width="1%"> </td>
<td width="7%"> </td>
<td width="1%"> </td>
<td width="3%"> </td>
<td width="1%"> </td>
<td width="7%"> </td>
<td width="1%"> </td>
</tr>
<tr style="font-size: 1px">
<td colspan="21" align="left" style="border-top: 2px solid #000000"> </td>
</tr>
<tr style="font-size: 9pt" valign="bottom">
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="19" style="border-bottom: 1px solid #000000"><b>Payments Due By Period</b></td>
</tr>
<tr style="font-size: 9pt; padding-top: 2px" valign="bottom">
<td nowrap="nowrap" align="left" style="border-bottom: 0px solid #000000"> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2"> </td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2"> </td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2"> </td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2"> </td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2"> </td>
<td> </td>
</tr>
<tr style="font-size: 9pt; padding-top: 2px" valign="bottom">
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2" style="border-bottom: 0px solid #000000"><b>Total</b></td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2"><b>Less than</b></td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2"><b>1 - 3</b></td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2"><b>3 - 5</b></td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2"><b>More than</b></td>
<td> </td>
</tr>
<tr style="font-size: 9pt; padding-top: 2px" valign="bottom">
<td nowrap="nowrap" align="left">
<div style="margin-left:20px; text-indent:-15px"><b>(in thousands)</b>
</div></td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2"><b>1 year</b></td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2"><b>years</b></td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2"><b>years</b></td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2"><b>5 years</b></td>
<td> </td>
</tr>
<!-- End Table Head -->
<!-- Begin Table Body -->
<tr style="font-size: 1px">
<td colspan="21" align="left" style="border-top: 1px solid #000000"> </td>
</tr>
<tr valign="bottom"><!-- Blank Space -->
<td>
<div style="margin-left:20px; text-indent:-15px"> 
</div></td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
</tr>
<tr valign="bottom" style="background: #cceeff">
<td>
<div style="margin-left:20px; text-indent:-15px">Daywork drilling contracts with related parties <sup style="font-size: 85%; vertical-align: text-top">(a)</sup>
</div></td>
<td> </td>
<td align="left">  $</td>
<td align="right">1,000</td>
<td> </td>
<td> </td>
<td align="left">  $</td>
<td align="right">1,000</td>
<td> </td>
<td> </td>
<td align="left">  $</td>
<td align="right">
<div style="margin-right: 10px">-
</div></td>
<td> </td>
<td> </td>
<td align="left">  $</td>
<td align="right">
<div style="margin-right: 10px">-
</div></td>
<td> </td>
<td> </td>
<td align="left">  $</td>
<td align="right">
<div style="margin-right: 10px">-
</div></td>
<td> </td>
</tr>
<tr valign="bottom">
<td>
<div style="margin-left:20px; text-indent:-15px">Other daywork drilling contracts
</div></td>
<td> </td>
<td> </td>
<td align="right">1,400</td>
<td> </td>
<td> </td>
<td> </td>
<td align="right">1,400</td>
<td> </td>
<td> </td>
<td> </td>
<td align="right">
<div style="margin-right: 10px">-
</div></td>
<td> </td>
<td> </td>
<td> </td>
<td align="right">
<div style="margin-right: 10px">-
</div></td>
<td> </td>
<td> </td>
<td> </td>
<td align="right">
<div style="margin-right: 10px">-
</div></td>
<td> </td>
</tr>
<tr style="font-size: 1px">
<td>
<div style="margin-left:20px; text-indent:-15px"> 
</div></td>
<td> </td>
<td nowrap="nowrap" colspan="3" align="right" style="border-top: 1px solid #000000"> </td>
<td> </td>
<td nowrap="nowrap" colspan="3" align="right" style="border-top: 1px solid #000000"> </td>
<td> </td>
<td nowrap="nowrap" colspan="3" align="right" style="border-top: 1px solid #000000"> </td>
<td> </td>
<td nowrap="nowrap" colspan="3" align="right" style="border-top: 1px solid #000000"> </td>
<td> </td>
<td nowrap="nowrap" colspan="3" align="right" style="border-top: 1px solid #000000"> </td>
</tr>
<tr valign="bottom" style="background: #cceeff">
<td>
<div style="margin-left:35px; text-indent:-15px">Total contractual drilling commitments
</div></td>
<td> </td>
<td align="left">  $</td>
<td align="right">2,400</td>
<td> </td>
<td> </td>
<td align="left">  $</td>
<td align="right">2,400</td>
<td> </td>
<td> </td>
<td align="left">  $</td>
<td align="right">
<div style="margin-right: 10px">-
</div></td>
<td> </td>
<td> </td>
<td align="left">  $</td>
<td align="right">
<div style="margin-right: 10px">-
</div></td>
<td> </td>
<td> </td>
<td align="left">  $</td>
<td align="right">
<div style="margin-right: 10px">-
</div></td>
<td> </td>
</tr>
<tr style="font-size: 1px">
<td>
<div style="margin-left:20px; text-indent:-15px"> 
</div></td>
<td> </td>
<td nowrap="nowrap" colspan="3" align="right" style="border-top: 3px double #000000"> </td>
<td> </td>
<td nowrap="nowrap" colspan="3" align="right" style="border-top: 3px double #000000"> </td>
<td> </td>
<td nowrap="nowrap" colspan="3" align="right" style="border-top: 3px double #000000"> </td>
<td> </td>
<td nowrap="nowrap" colspan="3" align="right" style="border-top: 3px double #000000"> </td>
<td> </td>
<td nowrap="nowrap" colspan="3" align="right" style="border-top: 3px double #000000"> </td>
</tr>
<tr valign="bottom" style="line-height: 3pt"><!-- Blank Space -->
<td>
<div style="margin-left:20px; text-indent:-15px"> 
</div></td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
</tr>
<tr style="font-size: 1px">
<td colspan="21" align="left" style="border-top: 1px solid #000000"> </td>
</tr>
<!-- End Table Body -->
</table>
</div>
<div align="center" style="margin-top: 6pt">
<table width="99%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; text-align: left">
<tr valign="top" style="font-size: 9pt; color: #000000; background: transparent">
<td width="2%" nowrap="nowrap" align="left"> <sup style="font-size: 85%; vertical-align: text-top">(a)</sup></td>
<td width="1%"> </td>
<td>
<div style="text-align: justify">Consists of daywork drilling contracts with Silver Oak Drilling, LLC, an affiliate
of Chase Oil Corporation (“Chase Oil”), a stockholder of the Company.
</div></td>
</tr>
</table>
</div>
<div align="center" style="font-size: 10pt; margin-top: 0pt">
<div style="border-bottom: 0px solid #000000; font-size: 1px">
</div>
</div>
<!-- Folio -->
<!-- /Folio -->
</div>
<!-- PAGEBREAK -->
<div style="font-family: 'Times New Roman',Times,serif">
<div align="center" style="font-size: 15pt; margin-top: 0pt">
<b>
</b>
</div>
<div align="justify" style="font-size: 10pt; margin-top: 10pt">        <b><i>Operating leases. </i></b>The Company leases vehicles, equipment and office facilities under
non-cancellable operating leases. Lease payments associated with these operating leases for the
years ended December 31, 2010, 2009 and 2008 were approximately $2.8 million, $2.3 million and $1.3
million, respectively.
</div>
<div align="justify" style="font-size: 10pt; margin-top: 10pt">        Future minimum lease commitments under non-cancellable operating leases at December 31, 2010
are as follows:
</div>
<div align="center">
<table style="font-size: 9pt; text-align: left" cellspacing="0" border="0" cellpadding="0" width="98%">
<!-- Begin Table Head -->
<tr valign="bottom">
<td width="88%"> </td>
<td width="2%"> </td>
<td width="1%"> </td>
<td width="8%"> </td>
<td width="1%"> </td>
</tr>
<tr style="font-size: 9pt" valign="bottom">
<td colspan="5" align="left" style="border-top: 2px solid #000000"> </td>
</tr>
<tr style="font-size: 9pt" valign="bottom">
<td nowrap="nowrap" align="left">
<div style="margin-left:20px; text-indent:-15px"><b>(in thousands)</b>
</div></td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
</tr>
<!-- End Table Head -->
<!-- Begin Table Body -->
<tr style="font-size: 1px">
<td colspan="5" align="left" style="border-top: 1px solid #000000"> </td>
</tr>
<tr valign="bottom" style="line-height: 6pt"><!-- Blank Space -->
<td>
<div style="margin-left:20px; text-indent:-15px"> 
</div></td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
</tr>
<tr valign="bottom" style="background: #cceeff">
<td>
<div style="margin-left:20px; text-indent:-15px">2011
</div></td>
<td> </td>
<td align="left">  $</td>
<td align="right">3,471</td>
<td> </td>
</tr>
<tr valign="bottom">
<td>
<div style="margin-left:20px; text-indent:-15px">2012
</div></td>
<td> </td>
<td> </td>
<td align="right">3,151</td>
<td> </td>
</tr>
<tr valign="bottom" style="background: #cceeff">
<td>
<div style="margin-left:20px; text-indent:-15px">2013
</div></td>
<td> </td>
<td> </td>
<td align="right">2,558</td>
<td> </td>
</tr>
<tr valign="bottom">
<td>
<div style="margin-left:20px; text-indent:-15px">2014
</div></td>
<td> </td>
<td> </td>
<td align="right">2,373</td>
<td> </td>
</tr>
<tr valign="bottom" style="background: #cceeff">
<td>
<div style="margin-left:20px; text-indent:-15px">2015 and thereafter
</div></td>
<td> </td>
<td> </td>
<td align="right">3,689</td>
<td> </td>
</tr>
<tr style="font-size: 1px">
<td>
<div style="margin-left:20px; text-indent:-15px"> 
</div></td>
<td> </td>
<td nowrap="nowrap" colspan="3" align="right" style="border-top: 1px solid #000000"> </td>
</tr>
<tr valign="bottom">
<td>
<div style="margin-left:30px; text-indent:-15px">Total
</div></td>
<td> </td>
<td align="left">  $</td>
<td align="right">15,242</td>
<td> </td>
</tr>
<tr style="font-size: 1px">
<td>
<div style="margin-left:20px; text-indent:-15px"> 
</div></td>
<td> </td>
<td nowrap="nowrap" colspan="3" align="right" style="border-top: 3px double #000000"> </td>
</tr>
<tr valign="bottom" style="line-height: 3pt"><!-- Blank Space -->
<td>
<div style="margin-left:20px; text-indent:-15px"> 
</div></td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
</tr>
<tr style="font-size: 1px">
<td colspan="5" align="left" style="border-top: 1px solid #000000"> </td>
</tr>
<!-- End Table Body -->
</table>
</div>
</div>
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-Publisher FASB
-Name FASB Interpretation (FIN)
-Number 14
-Paragraph 3
Reference 2: http://www.xbrl.org/2003/role/presentationRef
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-Name Statement of Financial Accounting Standard (FAS)
-Number 5
-Paragraph 9, 10, 11, 12
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