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Fair Value Measurements (Tables)
 12 Months Ended
Dec. 31, 2018
Fair Value Measurements [Abstract]  
Carrying Amount and Estimated Fair Values of Financial Instruments







 

 

 

 

 

 

 

 

 

 

 

 



December 31, 2018

 

December 31, 2017

 



Carrying

 

Fair

 

Carrying

 

Fair

 

(in millions)

Amount

 

Value

 

Amount

 

Value

 

Cash and cash equivalents

$

 201 

 

$

 201 

 

$

 916 

 

$

 916 

 

2018 revolving credit facility due April 2023

 

–  

 

 

–  

 

 

–  

 

 

–  

 

2016 term loan facility due December 2020 (1) (2)

 

–  

 

 

–  

 

 

 1,191 

 

 

 1,191 

 

Senior notes (1)(3)

 

 2,342 

 

 

 2,190 

 

 

 3,242 

 

 

 3,358 

 

Derivative instruments, net

 

 52 

 

 

 52 

 

 

 77 

(4)

 

 77 

(4)



(1)

Excludes unamortized debt issuance costs and debt discounts.



(2)

In April 2018, the Company replaced its 2016 credit facility with a new 2018 credit facility and repaid the $1,191 million secured term loan balance in full.



(3)

In December 2018, the Company repurchased $900 million of certain of its outstanding senior notes with a portion of the net proceeds from the Fayetteville Shale sale.



(4)

Includes $1 million in premiums paid related to certain natural gas call options recognized as a component of derivative assets within current assets on the consolidated balance sheet. 
Summary of Assets and Liabilities Measured at Fair Value on Recurring Basis







 

 

 

 

 

 

 

 

 

 

 

 



 

December 31, 2018



 

Fair Value Measurements Using:

 

 

 

(in millions)

 

Quoted Prices in Active Markets (Level 1)

 

Significant Other Observable Inputs (Level 2)

 

Significant Unobservable Inputs (Level 3)

 

Assets (Liabilities) at Fair Value

Assets

 

 

 

 

 

 

 

 

 

 

 

 

Fixed price swap – natural gas

 

$

–  

 

$

 38 

 

$

–  

 

$

 38 

Fixed price swap – oil

 

 

–  

 

 

 19 

 

 

–  

 

 

 19 

Fixed price swap – propane

 

 

–  

 

 

 11 

 

 

–  

 

 

 11 

Fixed price swap – ethane

 

 

–  

 

 

 8 

 

 

–  

 

 

 8 

Two-way costless collar – natural gas

 

 

–  

 

 

 11 

 

 

–  

 

 

 11 

Two-way costless collar – oil

 

 

–  

 

 

 11 

 

 

–  

 

 

 11 

Three-way costless collar – natural gas

 

 

–  

 

 

 75 

 

 

–  

 

 

 75 

Basis swap – natural gas

 

 

–  

 

 

 11 

 

 

–  

 

 

 11 

Purchased call option – natural gas

 

 

–  

 

 

 6 

 

 

–  

 

 

 6 

Interest rate swap

 

 

–  

 

 

 1 

 

 

–  

 

 

 1 

Liabilities

 

 

 

 

 

 

 

 

 

 

 

 

Purchased fixed price swap – oil

 

 

–  

 

 

 (6)

 

 

–  

 

 

 (6)

Fixed price swap – natural gas

 

 

–  

 

 

 (10)

 

 

–  

 

 

 (10)

Fixed price swap – ethane

 

 

–  

 

 

 (3)

 

 

–  

 

 

 (3)

Two-way costless collar – natural gas

 

 

–  

 

 

 (7)

 

 

–  

 

 

 (7)

Two-way costless collar – oil

 

 

–  

 

 

 (1)

 

 

–  

 

 

 (1)

Three-way costless collar – natural gas

 

 

–  

 

 

 (68)

 

 

–  

 

 

 (68)

Basis swap – natural gas

 

 

–  

 

 

 (22)

 

 

–  

 

 

 (22)

Sold call option – natural gas

 

 

–  

 

 

 (22)

 

 

–  

 

 

 (22)

Total

 

$

–  

 

$

 52 

 

$

–  

 

$

 52 







 

 

 

 

 

 

 

 

 

 

 

 



 

December 31, 2017



 

Fair Value Measurements Using:

 

 

 

(in millions)

 

Quoted Prices in Active Markets (Level 1)

 

Significant Other Observable Inputs (Level 2)

 

Significant Unobservable Inputs (Level 3)

 

Assets (Liabilities) at Fair Value

Assets

 

 

 

 

 

 

 

 

 

 

 

 

Fixed price swap – natural gas

 

$

–  

 

$

 56 

 

$

–  

 

$

 56 

Two-way costless collar – natural gas

 

 

–  

 

 

–  

 

 

 5 

 

 

 5 

Three-way costless collar – natural gas

 

 

–  

 

 

–  

 

 

 121 

 

 

 121 

Purchased call option – natural gas (1)

 

 

–  

 

 

–  

 

 

 3 

 

 

 3 

Basis swap – natural gas

 

 

–  

 

 

–  

 

 

 2 

 

 

 2 

Liabilities

 

 

 

 

 

 

 

 

 

 

 

 

Fixed price swap – natural gas

 

 

–  

 

 

 (1)

 

 

–  

 

 

 (1)

Two-way costless collar – natural gas

 

 

–  

 

 

–  

 

 

 (1)

 

 

 (1)

Three-way costless collar – natural gas

 

 

–  

 

 

–  

 

 

 (66)

 

 

 (66)

Basis swap – natural gas

 

 

–  

 

 

–  

 

 

 (23)

 

 

 (23)

Sold call option – natural gas

 

 

–  

 

 

–  

 

 

 (18)

 

 

 (18)

Interest rate swap

 

 

–  

 

 

 (1)

 

 

–  

 

 

 (1)

Total

 

$

–  

 

$

 54 

 

$

 23 

 

$

 77 



(1)

Includes $1 million in premiums paid related to certain natural gas call options recognized as a component of derivative assets within current assets on the consolidated balance sheets at December 31, 2017.
Reconciliations for Change in Net Fair Value of Derivative Assets and Liabilities Measured at Fair Value on a Recurring Basis Using Significant Unobservable Inputs (Level 3)









 

 

 

 

 

 



 

For the years ended



 

December 31,

(in millions)

 

2018

 

2017

Balance at beginning of year

 

$

 22 

 

$

 (195)

Total gains (losses):

 

 

   

 

 

 

Included in earnings

 

 

 (17)

 

 

 199 

Settlements (1)

 

 

 1 

 

 

 18 

Transfers into/out of Level 3 (2)

 

 

 (6)

 

 

–  

Balance at end of period

 

$

–  

 

$

 22 

Change in gains (losses) included in earnings relating to derivatives still held as of December 31

 

$

–  

 

$

 217 



(1)

Includes $1 million and $5 million amortization of premiums paid related to certain natural gas call options for the years ended December 31, 2018 and 2017, respectively.



(2)

Commodity derivatives previously presented as Level 3 were transferred to Level 2 in the second quarter of 2018 as the Company moved from using proprietary volatility inputs and forward curves to more widely available published information, increasing market observability.