Derivatives and Risk Management (Tables)

12 Months Ended

Dec. 31, 2020

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Schedule of Derivative Instruments Notional Amount, Weighted Average Contract Prices and Fair Value

The tables present the notional amount, the weighted average contract prices and the fair value by expected maturity dates as of December 31, 2020:

Financial Protection on Production

		Weighted Average Price per MMBtu										Fair value at December 31, 2020 ($ in millions)
	Volume (Bcf)	Swaps		Sold Puts		Purchased Puts		Sold Calls		Basis Differential
Natural Gas
2021
Fixed price swaps	201	$	2.80	$	—	$	—	$	—	$	—	$	29
Two-way costless collars	237	—		—		2.57		2.95		—		11
Three-way costless collars	313	—		2.16		2.49		2.85		—		(24)
Total	751											$	16
2022
Fixed price swaps	112	$	2.68	$	—	$	—	$	—	$	—	$	4
Two-way costless collars	63	—		—		2.52		3.03		—		(1)
Three-way costless collars	203	—		2.06		2.46		2.89		—		(15)
Total	378											$	(12)
2023
Three-way costless collars	87	$	—	$	2.06	$	2.47	$	2.98	$	—	$	—
Basis swaps
2021	219	$	—	$	—	$	—	$	—	$	(0.21)	$	57
2022	139	—		—		—		—		(0.33)		8
2023	47	—		—		—		—		(0.45)		—
2024	11	—		—		—		—		(0.60)		—
2025	4	—		—		—		—		(0.59)		—
Total	420											$	65

		Weighted Average Price per Bbl								Fair value at December 31, 2020 ($ in millions)
	Volume (MBbls)	Swaps		Sold Puts		Purchased Puts		Sold Calls
Oil
2021
Fixed price swaps	4,887	$	48.59	$	—	$	—	$	—	$	1
Two-way costless collars	201	—		—		37.73		45.68		(1)
Three-way costless collars	1,543	—		37.42		47.22		52.86		—
Total	6,631									$	—
2022
Fixed price swaps	1,282	$	46.37	$	—	$	—	$	—	$	—
Three-way costless collars	873	—		40.25		50.78		56.54		1
Total	2,155									$	1
2023
Three-way costless collars	878	$	—	$	33.52	$	43.52	$	53.41	$	(1)
Ethane
2021
Fixed price swaps	5,889	$	7.12	$	—	$	—	$	—	$	(10)
Two-way costless collars	584	—		—		7.14		10.40		—
Total	6,473									$	(10)
2022
Fixed price swaps	1,575	$	8.69	$	—	$	—	$	—	$	—
Two-way costless collars	135	—		—		7.56		9.66		—
Total	1,710									$	—
Propane
2021
Fixed price swaps	6,974	$	20.43	$	—	$	—	$	—	$	(36)
2022
Fixed price swaps	2,120	$	20.23	$	—	$	—	—		$	(2)
Normal Butane
2021
Fixed price swaps	2,004	$	24.97	$	—	$	—	$	—	$	(8)
2022
Fixed price swaps	667	$	22.77	$	—	$	—	$	—	$	(1)
Natural Gasoline
2021
Fixed price swaps	1,936	$	37.35	$	—	$	—	$	—	$	(13)
2022
Fixed price swaps	643	$	37.77	$	—	$	—	$	—	$	(2)

Other Derivative Contracts
	Volume (Bcf)	Weighted Average Strike Price per MMBtu		Fair value at December 31, 2020 ($ in millions)
Call Options – Natural Gas (Net)
2021	75	$	3.19	$	(8)
2022	77	3.00		(17)
2023	46	2.94		(8)
2024	9	3.00		(3)
Total	207			$	(36)
Put Options – Natural Gas
2021	18	$	2.00	$	(1)
2022	5	2.00		—
Total	23			$	(1)

	Volume (MBbls)	Weighted Average Strike Price per Bbl		Fair value at December 31, 2020 ($ in millions)
Sold Call Options – Oil
2021	226	$	60.00	$	—

	Volume (Bcf)	Weighted Average Strike Price per MMBtu		Fair value at December 31, 2020 ($ in millions)
Swaptions – Natural Gas
2021	0.1	$	3.00	$	(2)

		Weighted Average Strike Price per MMBtu				Fair value at December 31, 2020 ($ in millions)
Storage (1)	Volume (Bcf)	Swaps		Basis Differential
2021
Purchased fixed price swap	1	$	2.04	$	—	$	—
Fixed price swaps	2	2.49		—		—
Basis swaps	1	—		(0.38)		—
Total	4					$	—

(1)The Company has entered into certain derivatives to protect the value of volumes of natural gas injected into a storage facility that will be withdrawn at a later date.

	Volume (Bcf)	Weighted Average Strike Price per MMBtu		Fair value at December 31, 2020 ($ in millions)
Purchased Fixed Price Swaps – Marketing (Natural Gas) (1)
2021	6	$	2.44	$	1

(1)The Company has entered into a limited number of derivatives to protect the value of certain long-term sales contracts.

Balance Sheet Classification of Derivative Financial Instruments

The balance sheet classification of the assets and liabilities related to derivative financial instruments are summarized below as of December 31, 2020 and 2019:

Derivative Assets
	Balance Sheet Classification	Fair Value
(in millions)		December 31, 2020		December 31, 2019
Derivatives not designated as hedging instruments:
Purchased fixed price swaps – natural gas	Derivative assets	$	1	$	—
Fixed price swaps – natural gas	Derivative assets	37		77		(1)
Fixed price swaps – oil	Derivative assets	13		4
Fixed price swaps – ethane	Derivative assets	—		11
Fixed price swaps – propane	Derivative assets	—		21
Two-way costless collars – natural gas	Derivative assets	54		10
Two-way costless collars – oil	Derivative assets	—		5
Two-way costless collars – propane	Derivative assets	—		2
Three-way costless collars – natural gas	Derivative assets	57		126
Three-way costless collars – oil	Derivative assets	15		3
Basis swaps – natural gas	Derivative assets	60		17
Call options – natural gas	Derivative assets	4		1
Fixed price swaps – natural gas storage	Derivative assets	—		1
Fixed price swaps – natural gas	Other long-term assets	7		7
Fixed price swaps – oil	Other long-term assets	2		1
Fixed price swaps – propane	Other long-term assets	—		3
Two-way costless collars – natural gas	Other long-term assets	20		4
Three-way costless collars – natural gas	Other long-term assets	87		74
Three-way costless collars – oil	Other long-term assets	15		7
Basis swaps – natural gas	Other long-term assets	15		15
Call options – natural gas	Other long-term assets	—		2
Total derivative assets		$	387	$	391

(1)Includes $9 million in premiums paid related to certain natural gas fixed price swaps recognized as a component of derivative assets within current assets on the consolidated balance sheet at December 31, 2019.  As certain natural gas fixed price swaps settle, the premium will be amortized and recognized as a component of gain (loss) on derivatives on the consolidated statements of operations.

Derivative Liabilities
	Balance Sheet Classification	Fair Value
(in millions)		December 31, 2020		December 31, 2019
Derivatives not designated as hedging instruments:
Purchased fixed price swaps – natural gas	Derivative liabilities	$	—	$	1
Fixed price swaps – natural gas	Derivative liabilities	7		1
Fixed price swaps – oil	Derivative liabilities	12		6
Fixed price swaps – ethane	Derivative liabilities	10		—
Fixed price swaps – propane	Derivative liabilities	36		—
Fixed price swaps – normal butane	Derivative liabilities	8		—
Fixed price swaps – natural gasoline	Derivative liabilities	13		—
Two-way costless collars – natural gas	Derivative liabilities	43		4
Two-way costless collars – oil	Derivative liabilities	1		5
Three-way costless collars – natural gas	Derivative liabilities	82		84
Three-way costless collars – oil	Derivative liabilities	15		4
Basis swaps – natural gas	Derivative liabilities	3		17
Call options – natural gas	Derivative liabilities	12		3
Put options – natural gas	Derivative liabilities	1		—
Swaptions – natural gas	Derivative liabilities	2		—
Fixed price swaps – natural gas	Other long-term liabilities	3		—
Fixed price swaps – oil	Other long-term liabilities	2		2
Fixed price swaps – propane	Other long-term liabilities	2		—
Fixed price swaps – normal butane	Other long-term liabilities	1		—
Fixed price swaps – natural gasoline	Other long-term liabilities	2		—
Two-way costless collars – natural gas	Other long-term liabilities	21		4
Three-way costless collars – natural gas	Other long-term liabilities	102		72
Three-way costless collars – oil	Other long-term liabilities	15		8
Basis swaps – natural gas	Other long-term liabilities	7		9
Call options – natural gas	Other long-term liabilities	28		15
Call options – oil	Other long-term liabilities	—		1
Total derivative liabilities		$	428	$	236

Summary of Before Tax Effect of Cash Flow Hedges on Consolidated Financial Statements

The following tables summarize the before-tax effect of the Company’s derivative instruments on the consolidated statements of operations for the years ended December 31, 2020 and 2019:

Unsettled Gain (Loss) on Derivatives Recognized in Earnings
	Consolidated Statement of Operations Classification of Gain (Loss) on Derivatives, Unsettled	For the years ended December 31,
Derivative Instrument		2020			2019
		(in millions)
Purchased fixed price swaps – natural gas	Gain (Loss) on Derivatives	$	2		$	(1)
Purchased fixed price swaps – oil	Gain (Loss) on Derivatives	—			6
Fixed price swaps – natural gas	Gain (Loss) on Derivatives	(25)			46
Fixed price swaps – oil	Gain (Loss) on Derivatives	—			(22)
Fixed price swaps – ethane	Gain (Loss) on Derivatives	(21)			6
Fixed price swaps – propane	Gain (Loss) on Derivatives	(60)			13
Fixed price swaps – normal butane	Gain (Loss) on Derivatives	(9)			—
Fixed price swaps – natural gasoline	Gain (Loss) on Derivatives	(15)			—
Two-way costless collars – natural gas	Gain (Loss) on Derivatives	10			2
Two-way costless collars – oil	Gain (Loss) on Derivatives	(1)			(10)
Two-way costless collars – propane	Gain (Loss) on Derivatives	(1)			2
Three-way costless collars – natural gas	Gain (Loss) on Derivatives	(77)			37
Three-way costless collars – oil	Gain (Loss) on Derivatives	3			(2)
Basis swaps – natural gas	Gain (Loss) on Derivatives	59			17
Call options – natural gas	Gain (Loss) on Derivatives	(10)			1
Call options – oil	Gain (Loss) on Derivatives	1			(1)
Swaptions – natural gas	Gain (Loss) on Derivatives	7			—
Fixed price swaps – natural gas storage	Gain (Loss) on Derivatives	(1)			1
Interest rate swaps	Gain (Loss) on Derivatives	—			(1)
Total gain (loss) on unsettled derivatives		$	(138)		$	94
Settled Gain (Loss) on Derivatives Recognized in Earnings (1)
	Consolidated Statement of Operations Classification of Gain (Loss) on Derivatives, Settled	For the years ended December 31,
Derivative Instrument		2020			2019
		(in millions)
Purchased fixed price swaps – natural gas	Gain (Loss) on Derivatives	$	(3)		$	—
Purchased fixed price swaps – oil	Gain (Loss) on Derivatives	—			(3)
Fixed price swaps – natural gas	Gain (Loss) on Derivatives	142		(2)	78
Fixed price swaps – oil	Gain (Loss) on Derivatives	65			10
Fixed price swaps – ethane	Gain (Loss) on Derivatives	6			17
Fixed price swaps – propane	Gain (Loss) on Derivatives	18			29
Fixed price swaps – normal butane	Gain (Loss) on Derivatives	(2)			—
Fixed price swaps – natural gasoline	Gain (Loss) on Derivatives	(1)			—
Two-way costless collars – natural gas	Gain (Loss) on Derivatives	(5)			16
Two-way costless collars – oil	Gain (Loss) on Derivatives	17			6
Two-way costless collars – propane	Gain (Loss) on Derivatives	2			2
Three-way costless collars – natural gas	Gain (Loss) on Derivatives	38		(3)	31
Three-way costless collars – oil	Gain (Loss) on Derivatives	9			—
Basis swaps – natural gas	Gain (Loss) on Derivatives	76			(3)
Call options – natural gas	Gain (Loss) on Derivatives	—			(2)		(4)
Purchased fixed price swaps – natural gas storage	Gain (Loss) on Derivatives	(1)			—
Fixed price swaps – natural gas storage	Gain (Loss) on Derivatives	2			(1)
Interest rate swaps	Gain (Loss) on Derivatives	(1)			—
Total gain on settled derivatives		$	362		$	180
Total gain on derivatives		$	224		$	274

(1)The Company calculates gain (loss) on derivatives, settled, as the summation of gains and losses on positions that have settled within the period.

(2)Includes $9 million amortization of premiums paid related to certain natural gas fixed price options for the year ended December 31, 2020, which is included in gain (loss) on derivatives on the consolidated statements of operations.

(3)Includes $2 million amortization of premiums paid related to certain natural gas three-way costless collars for the year ended December 31, 2020, which is included in gain (loss) on derivatives on the consolidated statements of operations.

(4)Includes $1 million amortization of premiums paid related to certain natural gas call options for the year ended December 31, 2019, which is included in gain (loss) on derivatives on the consolidated statement of operations.