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Industry Segment Information
 9 Months Ended
Sep. 30, 2012
Segment Reporting [Abstract]  
Industry Segment Information
INDUSTRY SEGMENT INFORMATION
We have three main business segments offering different products and services:
 
•
Contract drilling,
•
Oil and natural gas, and
•
Mid-stream
The contract drilling segment is engaged in the land contract drilling of oil and natural gas wells. The oil and natural gas segment is engaged in the development, acquisition, and production of oil, NGLs, and natural gas properties and the mid-stream segment is engaged in the buying, selling, gathering, processing, and treating of natural gas and NGLs.
We evaluate each segment’s performance based on its operating income, which is defined as operating revenues less operating expenses and depreciation, depletion, amortization, and impairment. Our production in Canada is not significant.
The following table provides certain information about the operations of each of our segments:
 
 
Three Months Ended
September 30,
 
Nine Months Ended
September 30,
 
2012
 
2011
 
2012
 
2011
 
(In thousands)
Revenues:
 
 
 
 
 
 
 
Contract drilling
$
145,561

 
$
140,193

 
$
458,945

 
$
381,982

Elimination of inter-segment revenue
(12,141
)
 
(11,266
)
 
(37,747
)
 
(39,884
)
Contract drilling net of inter-segment revenue
133,420

 
128,927

 
421,198

 
342,098

Oil and natural gas
131,420

 
134,897

 
397,745

 
376,393

Gas gathering and processing
70,394

 
79,919

 
210,550

 
200,821

Elimination of inter-segment revenue
(17,459
)
 
(19,231
)
 
(50,573
)
 
(56,001
)
Gas gathering and processing net of inter-segment revenue
52,935

 
60,688

 
159,977

 
144,820

Other
(15
)
 
(667
)
 
1,160

 
(566
)
Total revenues
$
317,760

 
$
323,845

 
$
980,080

 
$
862,745

Operating income:
 
 
 
 
 
 
 
Contract drilling
$
40,338

 
$
35,105

 
$
134,558

 
$
94,679

Oil and natural gas
50,784

 
58,104

 
22,997

(2) 
150,584

Gas gathering and processing
784

 
3,372

 
7,404

 
14,050

Total operating income (1)
91,906

 
96,581

 
164,959

 
259,313

General and administrative expense
(8,434
)
 
(7,800
)
 
(23,814
)
 
(22,188
)
Interest expense, net
(7,087
)
 
(1,351
)
 
(11,455
)
 
(2,078
)
Other
(15
)
 
(667
)
 
1,160

 
(566
)
Income before income taxes
$
76,370

 
$
86,763

 
$
130,850

 
$
234,481


(1) Total operating income is total operating revenues less operating expenses, depreciation, depletion, amortization and impairment and does not include non-operating revenues, general corporate expenses, interest expense or income taxes.
(2) In June 2012, we had a non-cash ceiling test write-down of $115.9 million pre-tax ($72.1 million, net of tax).