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INCOME TAXES (Tables)

12 Months Ended

Dec. 31, 2012

An analysis of our deferred taxes follows:


	As of December 31,
	2012			2011
Tax effect of temporary differences:
Oil and gas properties – full cost	($	465,862	)	($	381,413	)
Asset retirement obligations		175,788			153,281
Stock compensation		5,588			4,962
Hedges		(16,983	)		(12,882	)
Alternative minimum tax credit carryforward		—			5,358
Other		6,153			8,931

	($	295,316	)	($	221,763	)

Reconcilation Between Statutory Federal Income Tax Rate and Effective Income Tax Rate as a Percentage of Income Before Income Taxes

A reconciliation between the statutory federal income tax rate and our effective income tax rate as a percentage of income before income taxes follows:


	Year Ended December 31,
	2012			2011			2010
Income tax expense computed at the statutory federal income tax rate		35.0	%		35.0	%		35.0	%
State taxes		1.0			1.0			1.0
IRC Sec. 162(m) limitation		0.6			0.3			—
Other		(0.5	)		(0.3	)		0.9

Effective income tax rate		36.1	%		36.0	%		36.9	%

Reconcilation Total Amount of Unrecognized Tax Benefits

A reconciliation of the total amounts of unrecognized tax benefits follows:


Total unrecognized tax benefits as of December 31, 2011	$	385
Increases (decreases) in unrecognized tax benefits as a result of:		—
Tax positions taken during a prior period		—
Tax positions taken during the current period		—
Settlements with taxing authorities		—
Lapse of applicable statute of limitations		—

Total unrecognized tax benefits as of December 31, 2012	$	385

- Definition

Tabular disclosure of tax positions taken in the tax returns filed or to be filed for which it is more likely than not that the tax position will not be sustained upon examination by taxing authorities (i.e., uncertain tax positions) and other types of income tax contingencies, including: (1) the policy on classification of interest and penalties; (2) a tabular reconciliation of the total amounts of unrecognized tax benefits at the beginning and end of the period; the total amount(s) of: (3) unrecognized tax benefits that, if recognized, would affect the effective tax rate, and (4) interest and penalties recognized in each of the income statement and balance sheet; (5) for positions for which it is reasonably possible that the total amounts unrecognized will significantly change within 12 months of the reporting date the: (i) nature of the uncertainty, (ii) nature of the event that could occur that would cause the change, and (iii) an estimate of the range of the reasonably possible change or a statement that an estimate of the range cannot be made; and (6) a description of tax years that remain subject to examination by major tax jurisdictions.

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