Derivative Instruments (Tables)

9 Months Ended

Sep. 30, 2019

Derivative Instruments.

Schedule of outstanding commodity derivatives

	Natural gas MMBtu/day	Natural Gas Liquids Bbls/day	Oil Bbls/day	Weighted average index price
Three months ending December 31, 2019:
NYMEX ($/MMBtu)	996,766	—	—	$	3.23
ARA Propane ($/Gal)	—	10,113	—		0.68
FEI Propane ($/Gal)	—	9,809	—		0.81
Mont Belvieu Propane Non-TET ($/Gal)	—	8,000	—		0.50
Mont Belvieu Butane Non-TET ($/Gal)	—	4,000	—		0.59
Mont Belvieu Natural Gasoline Non-TET ($/Gal)	—	3,500	—		1.14
NYMEX-WTI ($/Bbl)	—	—	18,000		59.05
Total	996,766	35,422	18,000
Year ending December 31, 2020:
NYMEX ($/MMBtu)	2,227,500		—	$	2.87
ARA Propane ($/Gal)	—	9,761	—		0.65
FEI Propane ($/Gal)	—	2,045	—		0.81
Mont Belvieu Butane Non-TET ($/Gal)	—	2,000	—		0.57
NYMEX-WTI ($/Bbl)	—		12,000		56.60
Total	2,227,500	13,806	12,000
Year ending December 31, 2021:
NYMEX ($/MMBtu)	2,110,000			$	2.79
Year ending December 31, 2022:
NYMEX ($/MMBtu)	290,000			$	2.96
Year ending December 31, 2023:
NYMEX ($/MMBtu)	90,000			$	2.91

Schedule of natural gas basis swap positions which settle on pricing index to basis differential of NYMEX to TCO

	Natural gas MMBtu/day	Natural Gas Liquids Bbls/day	Weighted average hedged differential
Three months ending December 31, 2019:
ARA to Mont Belvieu Non-TET ($/Gal)	—	4,050	$	0.25
Year ending December 31, 2020:
NYMEX to TCO ($/MMBtu)	60,000	—		0.353
ARA to Mont Belvieu Non-TET ($/Gal)	—	4,273	$	0.23
Total	60,000	4,273
Year ending December 31, 2021:
NYMEX to TCO ($/MMBtu)	40,000	—	$	0.414
Year ending December 31, 2022:
NYMEX to TCO ($/MMBtu)	60,000	—	$	0.515
Year ending December 31, 2023:
NYMEX to TCO ($/MMBtu)	50,000	—	$	0.525
Year ending December 31, 2024:
NYMEX to TCO ($/MMBtu)	50,000	—	$	0.530

Tabular disclosure of commodity derivatives basis differential positions which settle on the pricing index to basis differential of Columbia Gas (TCO) to the NYMEX Henry Hub natural gas price.

	Natural Gas Liquids Bbls/day	Weighted average payout ratio
Three months ending December 31, 2019:
Mont Belvieu Propane to NYMEX-WTI	500		50	%
Mont Belvieu Natural Gasoline to NYMEX-WTI	13,900		81	%
Total	14,400
Year ending December 31, 2020:
Mont Belvieu Propane to NYMEX-WTI	500		50	%
Mont Belvieu Natural Gasoline to NYMEX-WTI	15,000		79	%
Total	15,500
Year ending December 31, 2021:
Mont Belvieu Natural Gasoline to NYMEX-WTI	13,000		78	%

As of September 30, 2019, the Company’s fixed price natural gas collar positions from October 1, 2019 through December 31, 2019 were as follows (abbreviations in the table refer to the index to which the collar position is tied, as follows (NYMEX=Henry Hub):

	Natural gas (MMBtu/day)				Weighted average index price
	Ceiling		Floor		Ceiling price		Floor price
Three months ending December 31, 2019:
NYMEX ($/MMBtu)		1,575,000		1,333,234	$	3.52	$	2.50

Summary of the fair values of derivative instruments, which are not designated as hedges for accounting purposes

	December 31, 2018			September 30, 2019
	Balance sheet location	Fair value		Balance sheet location	Fair value
		(In thousands)			(In thousands)
Asset derivatives not designated as hedges for accounting purposes:
Commodity derivatives - current	Derivative instruments	$	245,263	Derivative instruments	$	411,774
Commodity derivatives - noncurrent	Derivative instruments		362,169	Derivative instruments		405,180
Total asset derivatives			607,432			816,954
Liability derivatives not designated as hedges for accounting purposes:
Commodity derivatives - current	Derivative instruments		532	Derivative instruments		—
Commodity derivatives - noncurrent	Derivative instruments		—	Derivative instruments		—
Total liability derivatives			532			—
Net derivatives		$	606,900		$	816,954

Schedule of gross amounts of recognized derivative assets and liabilities, the amounts offset under netting arrangements with counterparties, and the resulting net amounts

The following table presents the gross values of recognized derivative assets and liabilities, the amounts offset under master netting arrangements with counterparties, and the resulting net amounts presented in the consolidated balance sheets as of the dates presented, all at fair value (in thousands):

	December 31, 2018						September 30, 2019
	Gross amounts on balance sheet		Gross amounts offset on balance sheet		Net amounts of assets (liabilities) on balance sheet		Gross amounts on balance sheet		Gross amounts offset on balance sheet		Net amounts of assets (liabilities) on balance sheet
Commodity derivative assets	$	658,830		(51,398)		607,432	$	838,795		(21,841)		816,954
Commodity derivative liabilities	$	(51,930)		51,398		(532)	$	(21,841)		21,841		—

Summary of derivative fair value gains (losses)

The following is a summary of derivative fair value gains and losses and where such values are recorded in the unaudited condensed consolidated statements of operations (in thousands):

	Statement of operations	Three months ended September 30,				Nine months ended September 30,
	location	2018		2019		2018		2019
Commodity derivative fair value gains	Revenue	$	57,019		220,788		134,793		471,847
Marketing derivative fair value gains (losses)	Revenue	$	(42)		—		94,081		—