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Industry Segment Information
 9 Months Ended
Sep. 30, 2013
Segment Reporting [Abstract]  
Industry Segment Information
INDUSTRY SEGMENT INFORMATION
We have three main business segments offering different products and services. They are:
 
•
Oil and natural gas,
•
Contract drilling, and
•
Mid-stream
The oil and natural gas segment is engaged in the development, acquisition, and production of oil, NGLs, and natural gas properties. The contract drilling segment is engaged in the land contract drilling of oil and natural gas wells and the mid-stream segment is engaged in 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 each segment's operations:
 
Three Months Ended
September 30,
 
Nine Months Ended
September 30,
 
 
2013
 
2012
 
2013
 
2012
 
 
(In thousands)
 
Revenues:
 
 
 
 
 
 
 
 
Oil and natural gas
$
157,320

 
$
135,435

 
$
475,728

 
$
402,366

 
 
 
 
 
 
 
 
 
 
Contract drilling
119,105

 
145,561

 
357,118

 
458,945

 
Elimination of inter-segment revenue
(18,458
)
 
(12,141
)
 
(43,938
)
 
(37,747
)
 
Contract drilling net of inter-segment revenue
100,647

 
133,420

 
313,180

 
421,198

 
 
 
 
 
 
 
 
 
 
Gas gathering and processing
99,007

 
70,394

 
272,073

 
210,550

 
Elimination of inter-segment revenue
(23,198
)
 
(17,459
)
 
(68,252
)
 
(50,573
)
 
Gas gathering and processing net of inter-segment revenue
75,809

 
52,935

 
203,821

 
159,977

 
 
 
 
 
 
 
 
 
 
Total revenues
$
333,776

 
$
321,790

 
$
992,729

 
$
983,541

 
Operating income:
 
 
 
 
 
 
 
 
Oil and natural gas
$
50,887

 
$
54,799

 
$
173,945

 
$
27,618

(2 
) 
Contract drilling
24,257

 
40,338

 
72,030

 
134,558

 
Gas gathering and processing
3,938

 
784

 
7,613

 
7,404

 
Total operating income (1)
79,082

 
95,921

 
253,588

 
169,580

 
General and administrative
(9,936
)
 
(8,434
)
 
(28,288
)
 
(23,814
)
 
Gain on disposition of assets
4,345

 
44

 
7,744

 
1,283

 
Loss on derivatives not designated as hedges and hedge ineffectiveness, net
(13,760
)
 
(4,015
)
 
(3,340
)
 
(4,621
)
 
Interest expense, net
(3,625
)
 
(7,087
)
 
(11,777
)
 
(11,455
)
 
Other
(14
)
 
(59
)
 
(171
)
 
(123
)
 
Income before income taxes
$
56,092

 
$
76,370

 
$
217,756

 
$
130,850

 

(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, gain on disposition of assets, 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).