Fair Value Measurements

12 Months Ended

Dec. 31, 2011

Fair Value Measurements [Abstract]

Fair Value Measurements

10. Fair Value Measurements

FASB ASC 820-10 defines fair value, establishes guidelines for measuring fair value and expands disclosure about fair value measurements. It does not create or modify any current GAAP requirements to apply fair value accounting. However, it provides a single definition for fair value that is to be applied consistently for all prior accounting pronouncements. The adoption of this guidance did not have a material impact on our financial position or results of operations.

Fair Value of Financial Instruments. Our financial instruments consist of cash and cash equivalents, accounts receivable, accounts payable, bank borrowings, and senior notes. The carrying amounts of cash and cash equivalents, accounts receivable, and accounts payable approximate fair value due to the highly liquid or short-term nature of these instruments.

Based upon quoted market prices as of December 31, 2011 and 2010, the fair value of our senior notes due 2017, was 254.8 million, or 101.9% of face value, and 254.7 million, or 101.9% of face value, respectfully. Based upon quoted market prices as of December 31, 2011 and 2010, the fair value of our senior notes due 2020, was $239.6 million, or 106.5% of face value and $242.3 million, or 107.7% of face value, respectively. Based upon quoted market prices as of December 31, 2011, the fair value of our senior notes due 2022, was 252.8 million, or 101.1% of face value. The carrying value of our senior notes due 2017 was $250.0 million at December 31, 2011 and 2010, while the carrying value of our senior notes due 2020 was $221.9 million and $221.6 million at December 31, 2011 and 2010, respectively, and the carrying value of our senior notes due 2022 was $247.9 million

The following tables present our assets that are measured at fair value as of December 31, 2011 and 2010. They are categorized using the fair value hierarchy. The fair value hierarchy has three levels based on the reliability of the inputs used to determine the fair value (in millions):

	Fair Value Measurements at December 31,
	Total		Quoted Prices in Active markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
2011
Oil Derivatives	$	0.1	$	—	$	0.1	$	—
2010
Natural Gas Derivatives	$	0.3	$	—	$	0.3	$	—

Level 1 – Uses quoted prices in active markets for identical, unrestricted assets or liabilities. Instruments in this category include money market funds as they have comparable fair values for identical assets.

Level 2 – Uses quoted prices for similar assets or liabilities in active markets or observable inputs for assets or liabilities in non-active markets. Instruments in this category include our commodity derivatives that we value using commonly accepted industry-standard models (such as Black-Scholes) which contain inputs such as contract prices, risk-free rates, volatility measurements and other observable market data that are obtained from independent third-party sources.

Level 3 – Uses unobservable inputs for assets or liabilities that are in non-active markets. We do not have any assets or liabilities in this category that are not supported by market activity and have significant unobservable inputs.