Derivative Instruments (Tables)

12 Months Ended

Dec. 31, 2012

Derivative Instruments

Schedule of derivative contracts

The following derivative contracts were in place at December 31, 2012:

Crude Oil		Volume/Month	Price/Unit	Fair Value
Jan 2013-Dec 2013	Swap	14,000 Bbls	$101.25 (1)	$	1,346,343
Jan 2013-Dec 2013	Swap	9,000 Bbls	$109.13 (2)	232,424
Jan 2013-Jun 2013	Swap	6,000 Bbls	$108.35 (2)	(9,626		)
Jan 2013-Dec 2013	Swap	6,000 Bbls	$107.10 (2)	9,047
Jan 2013-Mar 2013	Swap	11,000 Bbls	$106.90 (2)	(87,050		)
Apr 2013-Jun 2013	Swap	7,000 Bbls	$104.80 (2)	(60,153		)
Jul 2013-Sep 2013	Swap	6,000 Bbls	$103.47 (2)	(45,781		)
Oct 2013-Dec 2013	Swap	3,000 Bbls	$102.30 (2)	(21,320		)
Jan 2014-Dec 2014	Swap	7,500 Bbls	$102.10 (2)	9,304
Natural Gas
Jan 2013-Jun 2013	Collar	50,000 MMBtu	$3.75 - $4.00 (3)	113,637
Jan 2013-Dec 2013	Collar	75,000 MMBtu	$3.00 - $4.25 (3)	(22,768		)
Jan 2013-Dec 2013	Collar	75,000 MMBtu	$3.25 - $4.00 (3)	124
Jan 2013-Dec 2013	Collar	35,000 MMBtu	$3.75 - $4.21 (3)	131,550
Jan 2013-Dec 2014	Collar	42,500 MMBtu	$3.75 - $4.60 (3)	217,794
Jan 2013-Dec 2014	Collar	42,500 MMBtu	$3.50 - $5.00 (3)	146,480
		Total net fair value of derivative instruments		$	1,960,005

(1) Commodity derivative based on West Texas Intermediate crude oil prices

(2) Commodity derivative based on Brent crude oil prices

(3) Commodity derivative based on Henry Hub NYMEX natural gas prices

Schedule of commodity swaps entered with counterparty

We also entered into the following commodity swaps with a counterparty in our bank group on February 8, 2013:

Crude Oil		Volume/Month	Price/Unit
Jan 2014 — Jun 2014	Swap	2,000 Bbls	$108.07 (1)
Jan 2014 — Dec 2014	Swap	6,000 Bbls	$106.40 (1)

(1) Commodity derivative based on Brent crude oil prices

Schedule of effect of derivative contracts on the Consolidated Statements of Operations

		Amount of Gain or (Loss) Recognized in Income
	Location of Gain or (Loss)	Twelve months ended December 31,
Contract Type	Recognized in Income	2012			2011			2010
Crude oil contracts	Crude oil sales	$	1,093,148		$	(3,531,207	)	$	1,446,686
Natural gas contracts	Natural gas sales	5,872,660			11,283,031			19,465,873
Natural gas liquids contract	Natural gas liquids sales	—			(254,220		)	—
Interest rate contracts	Interest expense	—			(1,410,764		)	(4,594,968		)
Realized gain		$	6,965,808		$	6,086,840		$	16,317,591
Crude oil contracts	Unrealized (loss) gain on derivative instruments	$	1,483,337		$	2,699,354		$	(1,477,423	)
Natural gas contracts	Unrealized (loss) gain on derivative instruments	(3,771,526		)	(3,637,188		)	(8,241,131		)
Interest rate contracts	Unrealized (loss) gain on derivative instruments	—			1,392,740			3,217,729
Unrealized gain (loss)		$	(2,288,189	)	$	454,906		$	(6,500,825	)