Derivative Activities (Tables)

6 Months Ended

Jun. 30, 2012

Derivative Activities [Abstract]

Derivative volumes hedged and average hedge prices

Period	Contract Type	Volume Hedged	Weighted Average Hedge Price
Natural Gas
2012	Collars	279,641 Mmbtu/day	$ 4.76–$ 5.22
2013	Collars	240,000 Mmbtu/day	$ 4.73–$ 5.20
2014	Collars	245,000 Mmbtu/day	$ 3.74–$ 4.50
2012	Swaps	245,000 Mmbtu/day	$3.75
2013	Swaps	167,521 Mmbtu/day	$3.56
Crude Oil
2012	Collars	2,000 bbls/day	$ 70.00–$ 80.00
2013	Collars	3,000 bbls/day	$ 90.60–$ 100.00
2014	Collars	2,000 bbls/day	$ 85.55–$ 100.00
2012	Call Options	4,700 bbls/day	$85.00
2012	Put Option	2,500 bbls/day	$80.00
2013	Swaps	6,313 bbls/day	$96.49
2014	Swaps	4,000 bbls/day	$94.56
NGLs (Natural Gasoline)
2012	Sold Swaps	12,000 bbls/day	$96.28
2013	Sold Swaps	8,000 bbls/day	$89.64
2012	Purchased Swaps	5,500 bbls/day	$82.37
2013	Purchased Swaps	1,500 bbls/day	$76.30
NGLs (Propane)
2012	Swaps	6,000 bbls/day	$38.67
2013	Swaps	5,000 bbls/day	$35.55

Derivative Fair Value loss

	Three Months Ended June 30,					Six Months Ended June 30,
	2012		2011			2012			2011
Change in fair value of derivatives that do not qualify for hedge accounting (a)	$	135,777	$	48,139		$	83,721		$	8,103
Realized gain (loss) on settlement – natural gas (a) (b)		—		3,484			—			3,090
Realized gain (loss) on settlement – oil (a) (b)		768		(6,094	)		(3,854	)		(8,012	)
Realized gain (loss) on settlement – NGLs (a) (b)		10,152		—			5,760			—
Hedge ineffectiveness – realized		1,278		1,576			2,463			2,522
– unrealized		594		5,934			(354	)		6,502
Derivative fair value income	$	148,569	$	53,039		$	87,736		$	12,205

^(a) Derivatives that do not qualify for hedge accounting.

^(b)  These amounts represent the realized gains and losses on settled derivatives that do not qualify for hedge accounting, which before settlement are included in the category in this same table referred to as change in fair value of derivatives that do not qualify for hedge accounting.

Combined fair value of derivatives, by Consolidated balance sheet

	June 30, 2012			December 31, 2011
Derivative assets:
Natural gas – swaps	$	33,637		$	54,162
– collars		208,178			228,228
Crude oil – swaps		23,744			(263	)
– collars		5,254			(16,607	)
– call options		(4,723	)		(29,348	)
– put options		1,071			—
NGLs – C5 swaps		79,492			15,328
– C3 swaps		2,333			—
	$	348,986		$	251,500
Derivative liabilities:
Natural gas – swaps	$	269		$	—
– collars		(1,112	)		—
NGLs – C5 swaps		(3,232	)		(173	)
– C3 swaps		(1,613	)		—
	$	(5,688	)	$	(173	)

Derivative Gross Assets and Gross Liabilities

	June 30, 2012								December 31, 2011
	Assets		(Liabilities)						Assets		(Liabilities)
	Carrying Value		Carrying Value			Net Carrying Value			Carrying Value		Carrying Value			Net Carrying Value
Derivatives that qualify for cash flow hedge accounting:
Swaps (a)	$	65,114	$	(7,464	)	$	57,650		$	54,318	$	(419	)	$	53,899
Collars (a)		221,540		(6,294	)		215,246			228,228		(1,954	)		226,274
Put options (a)		1,071		—			1,071			—		—			—
	$	287,725	$	(13,758	)	$	273,967		$	282,546	$	(2,373	)	$	280,173
Derivatives that do not qualify for hedge accounting:
Sold swaps (a)	$	87,262	$	(3,342	)	$	83,920		$	17,949	$	(2,794	)	$	15,155
Purchased swaps (a)		1,506		(8,447	)		(6,941	)		—		—			—
Collars (a)		—		(2,925	)		(2,925	)		—		(14,653	)		(14,653	)
Call options (a)		—		(4,723	)		(4,723	)		—		(29,348	)		(29,348	)
	$	88,768	$	(19,437	)	$	69,331		$	17,949	$	(46,795	)	$	(28,846	)

^(a)  Included in unrealized derivative gain or loss in the accompanying consolidated balance sheets.

Effects of cash flow hedges and other hedges on accumulated other comprehensive income (loss)

	Three Months Ended June 30,												Six Months Ended June 30,
	Change in Hedge Derivative Fair Value						Realized Gain Reclassified from OCI into Revenue (a)						Change in Hedge Derivative Fair Value						Realized Gain Reclassified from OCI into Revenue (a)
	2012			2011			2012			2011			2012			2011			2012			2011
Swaps	$	19,665		$	4,655		$	32,334		$	—		$	55,836		$	2,115		$	51,647		$	—
Put options		648			—			(315	)		—			(914	)		—			(315	)		—
Collars		(12,423	)		23,223			46,561			24,285			84,048			22,424			84,878			53,902
Collars – discontinued operations		—			—			—			—			—			412			—			8,607
Income taxes		(3,077	)		(10,454	)		(30,646	)		(9,107	)		(55,183	)		(7,414	)		(52,834	)		(23,441	)
	$	4,813		$	17,424		$	47,934		$	15,178		$	83,787		$	17,537		$	83,376		$	39,068

^(a)  For realized gains upon derivative contract settlement, the reduction in AOCI is offset by an increase in natural gas, NGLs and oil sales. For realized losses upon derivative contract settlement, the increase in AOCI is offset by a decrease in natural gas, NGLs and oil sales.

Effects of non-hedge derivatives on consolidated statement of operations

	Three Months Ended June 30,
	Gain (Loss) Recognized in Income (Non-hedge Derivatives)					Gain (Loss) Recognized in Income (Ineffective Portion)				Derivative Fair Value Income (Loss)
	2012			2011		2012		2011		2012			2011
Swaps	$	129,313		$	15,613	$	562	$	—	$	129,875		$	15,613
Purchased swaps		(8,744	)		—		—		—		(8,744	)		—
Collars		14,894			6,452		1,310		7,510		16,204			13,962
Call options		11,234			23,464		—		—		11,234			23,464
Total	$	146,697		$	45,529	$	1,872	$	7,510	$	148,569		$	53,039

	Six Months Ended June 30,
	Gain (Loss) Recognized in Income (Non-hedge Derivatives)						Gain (Loss) Recognized in Income (Ineffective Portion)				Derivative Fair Value Income (Loss)
	2012			2011			2012		2011		2012			2011
Swaps	$	76,328		$	13,750		$	666	$	—	$	76,994		$	13,750
Purchased swaps		(8,744	)		—			—		—		(8,744	)		—
Collars		12,392			(1,135	)		1,443		9,024		13,835			7,889
Call options		5,651			(9,391	)		—		—		5,651			(9,391	)
Basis swaps		—			(43)			—		—		—			(43)
Total	$	85,627		$	3,181		$	2,109	$	9,024	$	87,736		$	12,205