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Derivative Instruments and Hedging Activities (Tables)
 9 Months Ended
Sep. 30, 2015
Derivative Instruments and Hedging Activities Disclosure [Abstract]  
Hedging Positions
The following tables illustrate our derivative positions for calendar years 2015 and 2016 as of November 3, 2015:
 
Fixed-Price Swaps (NYMEX)
 
Natural Gas
 
Oil
 
Daily Volume
(MMBtus/d)
 
Swap Price
($)
 
Daily Volume
(Bbls/d)
 
Swap Price
($)
2015
10,000

 
4.005

 
1,000

 
89.00

2015
10,000

 
4.120

 
1,000

 
90.00

2015
10,000

 
4.150

 
1,000

 
90.25

2015
10,000

 
4.165

 
1,000

 
90.40

2015
10,000

 
4.220

 
1,000

 
91.05

2015
10,000

 
4.255

 
1,000

 
93.28

2015
 
 
 
 
1,000

 
93.37

2015
 
 
 
 
1,000

 
94.85

2015
 
 
 
 
1,000

 
95.00

2016
10,000

 
4.110

 
1,000

 
49.75

2016
10,000

 
4.120

 
1,000

 
52.78

2016


 


 
1,000

 
90.00

 
 
Costless Collar (NYMEX)
 
Oil
 
Daily Volume
(Bbls/d)
 
Floor Price ($)
 
Ceiling Price ($)
2016
1,000

 
45.00

 
54.75

 
 
 
 
 
 
Location and Fair Value Amounts of Derivative Instruments Reported in Balance Sheet
The following tables disclose the location and fair value amounts of derivatives qualifying as hedging instruments, as reported in our balance sheet, at September 30, 2015 and December 31, 2014:
Fair Value of Derivatives Qualifying as Hedging Instruments at
September 30, 2015
(In millions)
 
Asset Derivatives
 
Liability Derivatives
Description
Balance Sheet Location
 
Fair
Value
 
Balance Sheet Location
 
Fair
Value
Commodity contracts
Current assets: Fair value of
derivative contracts
 
$
61.4

 
Current liabilities: Fair value
of derivative contracts
 
$
—

 
Long-term assets: Fair value
of derivative contracts
 
5.7

 
Long-term liabilities: Fair
value of derivative contracts
 
0.2

 
 
 
$
67.1

 
 
 
$
0.2

 
 
 
 
 
 
 
 
Fair Value of Derivatives Qualifying as Hedging Instruments at
December 31, 2014
(In millions)
 
Asset Derivatives
 
Liability Derivatives
Description
Balance Sheet Location
 
Fair
Value
 
Balance Sheet Location
 
Fair
Value
Commodity contracts
Current assets: Fair value of
derivative contracts
 
$
127.0

 
Current liabilities: Fair value
of derivative contracts
 
$
—

 
Long-term assets: Fair value
of derivative contracts
 
14.3

 
Long-term liabilities: Fair
value of derivative contracts
 
—

 
 
 
$
141.3

 
 
 
$
—
Before Tax Effect of Derivative Instruments in Statement of Operations
The following tables disclose the before tax effect of derivatives qualifying as hedging instruments, as reported in the statement of operations, for the three and nine months ended September 30, 2015 and 2014:
Effect of Derivatives Qualifying as Hedging Instruments on the Statement of Operations
for the Three Months Ended September 30, 2015 and 2014
(In millions)
Derivatives in
Cash Flow Hedging
Relationships
 
Amount of Gain
(Loss) Recognized
in Other
Comprehensive
Income on
Derivatives
 
Gain (Loss) Reclassified from
Accumulated Other Comprehensive
Income into Income
(Effective Portion) (a)
 
Gain (Loss) Recognized in Income
on Derivatives
(Ineffective Portion)
 
 
2015
 
2014
 
Location
 
2015
 
2014
 
Location
 
2015
 
2014
Commodity contracts
 
$
31.6

 
$
47.1

 
Operating revenue -
oil/natural gas production
 
$
39.9

 
$
(1.3
)
 
Derivative income
(expense), net
 
$
1.2

 
$
2.1

Total
 
$
31.6

 
$
47.1

 
 
 
$
39.9

 
$
(1.3
)
 
 
 
$
1.2

 
$
2.1


(a)
For the three months ended September 30, 2015, effective hedging contracts increased oil revenue by $36.3 million and increased natural gas revenue by $3.6 million. For the three months ended September 30, 2014, effective hedging contracts (decreased) oil revenue by $1.3 million and had a minimal effect on natural gas revenue.
 
Effect of Derivatives Qualifying as Hedging Instruments on the Statement of Operations
for the Nine Months Ended September 30, 2015 and 2014
(In millions)
Derivatives in
Cash Flow Hedging
Relationships
 
Amount of Gain
(Loss) Recognized
in Other
Comprehensive
Income on
Derivatives
 
Gain (Loss) Reclassified from
Accumulated Other Comprehensive
Income into Income
(Effective Portion) (a)
 
Gain (Loss) Recognized in Income
on Derivatives
(Ineffective Portion)
 
 
2015
 
2014
 
Location
 
2015
 
2014
 
Location
 
2015
 
2014
Commodity contracts
 
$
35.7

 
$
3.7

 
Operating revenue -
oil/natural gas production
 
$
107.1

 
$
(17.6
)
 
Derivative income
(expense), net
 
$
1.7

 
$
0.5

Total
 
$
35.7

 
$
3.7

 
 
 
$
107.1

 
$
(17.6
)
 
 
 
$
1.7

 
$
0.5


(a)
For the nine months ended September 30, 2015, effective hedging contracts increased oil revenue by $96.8 million and increased natural gas revenue by $10.3 million. For the nine months ended September 30, 2014, effective hedging contracts (decreased) oil revenue by $10.0 million and (decreased) natural gas revenue by $7.6 million.
Location and Fair Value Amounts of Derivative Instruments Not Qualifying as Hedging Instruments Reported in Balance Sheet
The following table discloses the location and fair value amounts of our derivatives not qualifying as hedging instruments, as reported in our balance sheet, at September 30, 2015 and December 31, 2014:
Fair Value of Derivatives Not Qualifying as Hedging Instruments
(In millions)
Description
Balance Sheet Location
 
September 30,
2015
 
December 31,
2014
Commodity contracts
Current assets: Fair value of derivative contracts
 
$
4.3

 
$
12.1
Gains or Losses Related to Changes in Fair Value and Cash Settlements on Derivatives Not Qualifying as Hedging Instruments
Gains or losses related to changes in fair value and cash settlements for derivatives not qualifying as hedging instruments are recorded as derivative income (expense) in the statement of operations. The following table discloses the before tax effect of our derivatives not qualifying as hedging instruments on the statement of operations, for the three and nine months ended September 30, 2015 and 2014.
Amount of Gain (Loss) Recognized in Derivative Income (Expense)
(In millions)
 
Three Months Ended
September 30,
 
Nine Months Ended
September 30,
Description
2015
 
2014
 
2015
 
2014
Commodity contracts:
 
 
 
 
 
 
 
Cash settlements
$
3.8

 
$
0.7

 
$
11.0

 
$
0.7

Change in fair value
(2.6
)
 
3.0

 
(7.9
)
 
1.5

Total gains (losses) on non-qualifying hedges
$
1.2

 
$
3.7

 
$
3.1

 
$
2.2
Offsetting Assets
The following table presents the potential impact of the offset rights associated with our recognized assets and liabilities at September 30, 2015 (in millions):
 
 
As Presented Without Netting
 
Effects of Netting
 
With Effects of Netting
 
 
 
 
 
 
 
Current assets: Fair value of derivative contracts
 
$
65.7

 
$
—

 
$
65.7

Long-term assets: Fair value of derivative contracts
 
5.7

 
(0.2
)
 
5.5

Current liabilities: Fair value of derivative contracts
 
—

 
—

 
—

Long-term liabilities: Fair value of derivative contracts
 
(0.2
)
 
0.2

 
—
Offsetting Liabilities
The following table presents the potential impact of the offset rights associated with our recognized assets and liabilities at September 30, 2015 (in millions):
 
 
As Presented Without Netting
 
Effects of Netting
 
With Effects of Netting
 
 
 
 
 
 
 
Current assets: Fair value of derivative contracts
 
$
65.7

 
$
—

 
$
65.7

Long-term assets: Fair value of derivative contracts
 
5.7

 
(0.2
)
 
5.5

Current liabilities: Fair value of derivative contracts
 
—

 
—

 
—

Long-term liabilities: Fair value of derivative contracts
 
(0.2
)
 
0.2

 
—