INCOME TAXES (Tables)

12 Months Ended

Dec. 31, 2012

INCOME TAXES

Schedule of difference between the Company's effective income tax rate and federal statutory rate

	2012			2011			2010
	(in thousands)
Income taxes at federal statutory rate(a)	$	5,274		$	7,331		$	6,920
Change in valuation allowance		(6,537	)		(9,675	)		(8,267	)
Nondeductible expenses		694			574			91
State income taxes net of federal benefit		931			1,294			1,221
Other		(369	)		398			6
	$	(7	)	$	(78	)	$	(29	)

(a)

34% for 2012, 2011 and 2010.

Schedule of deferred tax assets and liabilities

Deferred tax assets and liabilities are as follows as of December 31:

	2012		2011
	(in thousands)
Deferred tax assets relating to:
Net operating loss carryforward	$	101,393	$	99,183
Oil and gas properties and tangible equipment		25,111		34,655
Stock option expense		3,682		2,956
Unrealized loss on derivatives		558		480
Other		324		324
		131,068		137,598
Less valuation allowance		130,879		137,416
Total deferred tax asset		189		182
Deferred tax liabilities relating to:
Net unrealized gain on investments		189		182
Total deferred tax liability		189		182
Net deferred tax asset (liability)	$	—	$	—