Fair Value Measurements (Tables)

12 Months Ended

Dec. 31, 2011

Schedule of the Company's assets and liabilities measured at fair value

The following is a listing of the Company’s assets and liabilities that are measured at fair value and where they are classified within the hierarchy as of December 31, 2011:



	Level 1		Level 2		Level 3
	(in thousands)
Assets:
Derivatives ⁽¹⁾	$	—	$	86,875	$	—
Proved oil and gas properties ⁽²⁾	$	—	$	—	$	139,992
Unproved oil and gas properties ⁽²⁾	—		—		15,809
Liabilities:
Derivatives⁽¹⁾	$	—	$	55,681	$	—
Net Profits Plan ⁽¹⁾	$	—	$	—	$	107,731

(1) This represents a financial asset or liability that is measured at fair value on a recurring basis.

(2) This represents a non-financial asset that is measured at fair value on a nonrecurring basis.

Schedule of reconciliation of fair value measurements using Level 3 inputs

The following table reflects the activity for the Net Profits Plan liability measured at fair value using Level 3 inputs:



	For the Years Ended December 31,
	2011			2010			2009
	(in thousands)
Beginning balance	$	135,850		$	170,291		$	177,366
Net increase in liability ⁽¹⁾	2,269			14,063			13,511
Net settlements ^{(1) (2) (3)}	(30,388		)	(48,504		)	(20,586		)
Transfers in (out) of Level 3	—			—			—
Ending balance	$	107,731		$	135,850		$	170,291


(1)	Net changes in the Net Profits Plan liability are shown in the Change in Net Profits Plan liability line item of the accompanying statements of operations.


(2)	Settlements represent cash payments made or accrued under the Net Profits Plan. The Company accrued or made cash payments under the Net Profits Plan relating to divestiture proceeds of $6.3 million, $26.1 million, and $724,000 for the years ended December 31, 2011, 2010, and 2009 respectively.


(3)	During the first quarter of 2011, the Company elected to cash out several Net Profits Plan pools associated with the acquisition of Nance Petroleum Corporation in 1999, through a $2.6 million direct payment. As a result, the Company reduced its Net Profits Plan liability by that amount.

- Definition

Tabular disclosure of liabilities, including [financial] instruments measured at fair value that are classified in stockholders' equity, if any, by class that are measured at fair value on a recurring and/or nonrecurring basis. The disclosures contemplated herein include the fair value measurements at the reporting date by the level within the fair value hierarchy in which the fair value measurements in their entirety fall, segregating fair value measurements using quoted prices in active markets for identical assets (Level 1), significant other observable inputs (Level 2), and significant unobservable inputs (Level 3). Where the quoted price in an active market for the identical liability is not available, the Level 1 input is the quoted price of an identical liability when traded as an asset.

+ References+ Details

- Definition

Tabular disclosure of the fair value measurement of liabilities using significant unobservable inputs (Level 3), a reconciliation of the beginning and ending balances, separately presenting changes during the period attributable to the following: (1) total gains or losses for the period (realized and unrealized), segregating those gains or losses included in earnings (or changes in net assets), and gains or losses recognized in other comprehensive income and a description of where those gains or losses included in earnings (or changes in net assets) are reported in the statement of income (or activities); (2) purchases, sales, issuances, and settlements (each type disclosed separately); and (3) transfers in and transfers out of Level 3 (for example, transfers due to changes in the observability of significant inputs) by class of liability.

+ References+ Details