Fair Value Measurements (Tables)

6 Months Ended

Jun. 30, 2018

Assets and Liabilities Measured at Fair Value on a Recurring Basis

The following fair value hierarchy tables present information about Energen’s assets and liabilities measured at fair value on a recurring basis:



	June 30, 2018
(in thousands)	Level 2			Level 3			Total
Assets:
Derivative instruments	$	(40,851	)	$	76,228		$	35,377
Noncurrent derivative instruments	(2,037		)	2,295			258
Total assets	(42,888		)	78,523			35,635
Liabilities:
Derivative instruments	95,321			(14,325		)	80,996
Noncurrent derivative instruments	28,490			2,545			31,035
Total liabilities	123,811			(11,780		)	112,031
Net derivative asset (liability)	$	(166,699	)	$	90,303		$	(76,396	)



	December 31, 2017
(in thousands)	Level 2			Level 3			Total
Liabilities:
Derivative instruments	$	43,241		$	28,138		$	71,379
Noncurrent derivative instruments	7,736			1,150			8,886
Total liabilities	50,977			29,288			80,265
Net derivative liability	$	(50,977	)	$	(29,288	)	$	(80,265	)

Schedule of Changes in Fair Value of Derivative Commodity Instruments

The table below sets forth a summary of changes in the fair value of Energen’s Level 3 derivative commodity instruments as follows:



	Three months ended
	June 30,
(in thousands)	2018			2017
Balance at beginning of period	$	24,502		$	5,574
Realized gains	4,518			417
Unrealized gains relating to instruments held at the reporting date*	68,138			1,876
Settlements during period	(6,855		)	(222		)
Balance at end of period	$	90,303		$	7,645



	Six months ended
	June 30,
(in thousands)	2018			2017
Balance at beginning of period	$	(29,288	)	$	(8,852	)
Realized losses	(3,322)			(2,845		)
Unrealized gains relating to instruments held at the reporting date*	121,929			16,301
Settlements during period	984			3,041
Balance at end of period	$	90,303		$	7,645

*Includes $68.3 million and $104.4 million in gains related to open contracts held at the reporting date for the three months and six months ended June 30, 2018, respectively. Includes $3.1 million and $11.0 million in gains related to open contracts held at the reporting date for the three months and six months ended June 30, 2017, respectively.

Quantitative Information About Level 3 Fair Value Measurements of Derivative Commodity Instruments

The table below sets forth quantitative information about Energen’s Level 3 fair value measurements of derivative commodity instruments as follows:



(in thousands, except price data)	Fair Value as of June 30, 2018			Valuation Technique*	Unobservable Input*	Range
Oil Basis - WTI/WTI
2018	$	71,895		Discounted Cash Flow	Forward Basis	($13.12) - ($12.88) Bbl
2019	$	43,229		Discounted Cash Flow	Forward Basis	($8.75) - ($7.86) Bbl
2020	$	2,213		Discounted Cash Flow	Forward Basis	($1.40) - ($1.14) Bbl
Natural Gas Liquids
2018	$	(17,589	)	Discounted Cash Flow	Forward Basis	$0.83 Gal
2019	$	(9,445	)	Discounted Cash Flow	Forward Basis	$0.74 Gal

*Discounted cash flow represents an income approach in calculating fair value including the referenced unobservable input and a discount reflecting credit quality of the counterparty.