XML 60 R16.htm IDEA: XBRL DOCUMENT v3.22.0.1
Derivative Instruments
 12 Months Ended
Dec. 31, 2021
Derivative Instruments and Hedging Activities Disclosure [Abstract]  
Derivative Instruments Derivative Instruments
As of December 31, 2021, the Company had the following outstanding financial commodity derivatives:
CollarsSwaps
FloorCeilingBasis SwapsRoll Swaps
Type of ContractVolume (Mbbl)Contract PeriodRange ($/Bbl)Weighted- Average ($/Bbl)Range ($/Bbl)Weighted- Average ($/Bbl)Weighted- Average ($/Bbl)Weighted- Average ($/Bbl)
Crude oil (WTI)630Jan. 2022-Mar. 2022$—$35.00 
$45.15-$45.40
$45.28 
Crude oil (WTI)1,629Jan. 2022-Jun. 2022
$35.00-$37.50
$36.11 
$48.38-$51.10
$49.97 
Crude oil (WTI)2,730Jan. 2022-Sep. 2022$—$40.00 
$47.55-$50.89
$49.19 
Crude oil (WTI)2,920Jan. 2022-Dec. 2022$—$57.00 
$72.20-$72.80
$72.43 
Crude oil (WTI Midland)(1)
630Jan. 2022-Mar. 2022$0.11 
Crude oil (WTI Midland)(1)
1,448Jan. 2022-Jun. 2022$0.25 
Crude oil (WTI Midland)(1)
1,911Jan. 2022-Sep. 2022$0.38 
Crude oil (WTI Midland)(1)
2,920Jan. 2022-Dec. 2022$0.05 
Crude oil (WTI)630Jan. 2022-Mar. 2022$(0.24)
Crude oil (WTI)724Jan. 2022-Jun. 2022$(0.20)
Crude oil (WTI)1,911Jan. 2022-Sep. 2022$0.10 
________________________________________________________
(1)The index price the Company pays under these basis swaps is WTI Midland, as quoted by Argus Americas Crude.
Collars
FloorCeiling
Type of ContractVolume (Mmbtu)Contract PeriodRange
($/Mmbtu)		Weighted-Average
($/Mmbtu)		Range
($/Mmbtu)		Weighted- Average
($/Mmbtu)
Natural gas (NYMEX)36,000,000 Jan. 2022-Mar. 2022
$4.00 - $4.75
$4.38 
$5.00 - $10.32
$6.97 
Natural gas (NYMEX)42,800,000 Apr. 2022 - Oct. 2022
$3.00 - $3.50
$3.19 
$4.07 - $4.83
$4.30 
Natural gas (Perm EP)(1)
1,800,000 Jan. 2022-Mar. 2022
$1.80 - $1.90
$1.85 
$2.18 - $2.19
$2.18 
Natural gas (Perm EP)(1)
3,620,000 Jan. 2022-Jun. 2022$— $2.40 
$2.85 - $2.90
$2.88 
Natural gas (Perm EP)(1)
7,300,000 Jan. 2022-Dec. 2022$— $2.50 $— $3.15 
Natural gas (PEPL)(2)
3,600,000 Jan. 2022-Mar. 2022
$1.90 - $2.10
$2.00 
$2.35 - $2.44
$2.40 
Natural gas (PEPL)(2)
3,620,000 Jan. 2022-Jun. 2022$— $2.40 
$2.81 - $2.91
$2.86 
Natural gas (PEPL)(2)
7,300,000 Jan. 2022-Dec. 2022$— $2.60 $— $3.27 
Natural gas (Waha)(3)
3,600,000 Jan. 2022-Mar. 2022
$1.70 - $1.84
$1.77 
$2.10 - $2.20
$2.15 
Natural gas (Waha)(3)
3,620,000 Jan. 2022-Jun. 2022$— $2.40 
$2.82 - $2.89
$2.86 
Natural gas (Waha)(3)
2,730,000 Jan. 2022-Sep. 2022$— $2.40 $— $2.77 
Natural gas (Waha)(3)
7,300,000 Jan. 2022-Dec. 2022$— $2.50 $— $3.12 
________________________________________________________
(1)The index price for these collars is El Paso Natural Gas Company, Permian Basin Index (“Perm EP”), as quoted in Platt’s Inside FERC.
(2)The index price for these collars is Panhandle Eastern Pipe Line, Tex/OK Mid-Continent Index (“PEPL”), as quoted in Platt’s Inside FERC.
(3)The index price for these collars is Waha West Texas Natural Gas Index (“Waha”), as quoted in Platt’s Inside FERC.
In early 2022, the Company entered into the following outstanding financial commodity derivatives:
Collars
FloorCeiling
Type of ContractVolume (Mmbtu)Contract PeriodRange
($/Mmbtu)		Weighted-
Average
($/Mmbtu)		Range
($/Mmbtu)		Weighted-
Average
($/Mmbtu)
Natural gas (NYMEX)71,500,000Apr. 2022-Dec. 2022
$3.50 - $4.25
$3.84 
$4.75 - $6.65
$5.39 
Natural gas (NYMEX)10,700,000 Apr. 2022-Oct. 2022$— $4.00 
$5.60 - $5.69
$5.63 
Natural gas (NYMEX)7,550,000 Nov. 2022-Mar. 2023$— $4.00 
$7.06 - $7.10
$7.08 
Effect of Derivative Instruments on the Consolidated Balance Sheet
  Fair Values of Derivative Instruments
  Derivative AssetsDerivative Liabilities
  December 31,December 31,
(In millions)Balance Sheet Location2021202020212020
Commodity contractsDerivative instruments (current)$7 $26 $159 $— 
Offsetting of Derivative Assets and Liabilities in the Consolidated Balance Sheet
 December 31,
(In millions)20212020
Derivative assets  
Gross amounts of recognized assets$27 $26 
Gross amounts offset in the consolidated balance sheet(20)— 
Net amounts of assets presented in the consolidated balance sheet7 26 
Gross amounts of financial instruments not offset in the consolidated balance sheet— — 
Net amount$7 $26 
Derivative liabilities
Gross amounts of recognized liabilities$179 $— 
Gross amounts offset in the consolidated balance sheet(20)— 
Net amounts of liabilities presented in the consolidated balance sheet159 — 
Gross amounts of financial instruments not offset in the consolidated balance sheet35 — 
Net amount$194 $— 
Effect of Derivative Instruments on the Consolidated Statement of Operations
Year Ended December 31,
(In millions)202120202019
Cash (paid) received on settlement of derivative instruments
Gas contracts$(307)$35 $139 
Oil contracts(124)— — 
Non-cash (loss) gain on derivative instruments
Gas contracts99 26 (58)
Oil contracts111 — — 
$(221)$61 $81 
Additional Disclosures about Derivative Instruments
The use of derivative instruments involves the risk that the counterparties will be unable to meet their obligations under the agreements. The Company's counterparties are primarily commercial banks and financial service institutions that management believes present minimal credit risk and its derivative contracts are with multiple counterparties to minimize its exposure to any individual counterparty. The Company performs both quantitative and qualitative assessments of these counterparties based on their credit ratings and credit default swap rates where applicable.
Certain counterparties to the Company's derivative instruments are also lenders under its revolving credit facility. The Company's revolving credit facility and derivative instruments contain certain cross default and acceleration provisions that may require immediate payment of the Company’s liabilities thereunder if the Company defaults on other material indebtedness. The Company also has netting arrangements with each of its counterparties that allow it to offset assets and liabilities from separate derivative contracts with that counterparty.