Quarterly report pursuant to Section 13 or 15(d)

Derivative Instruments (Tables)

v3.5.0.2
Derivative Instruments (Tables)
 6 Months Ended
Jun. 30, 2016
General Discussion of Derivative Instruments and Hedging Activities [Abstract]  
Schedule Of Derivative Instruments
Below is a summary of the Company's open fixed price swap positions as of June 30, 2016. 
 
Location
Daily Volume
(Bbls/day)
 
Weighted
Average Price
July 2016 - June 2017
ARGUS LLS
2,000

 
$
51.10

 
Location
Daily Volume (MMBtu/day)
 
Weighted
Average Price
July 2016
NYMEX Henry Hub
550,000

 
$
3.06

August 2016 - September 2016
NYMEX Henry Hub
560,000

 
$
3.04

October 2016
NYMEX Henry Hub
570,000

 
$
3.05

November 2016 - December 2016
NYMEX Henry Hub
525,000

 
$
3.18

January 2017 - February 2017
NYMEX Henry Hub
442,500

 
$
3.14

March 2017
NYMEX Henry Hub
422,500

 
$
3.13

April 2017 - June 2017
NYMEX Henry Hub
367,500

 
$
3.15

July 2017 - October 2017
NYMEX Henry Hub
305,000

 
$
2.99

November 2017 - December 2017
NYMEX Henry Hub
385,000

 
$
3.03

January 2018 - March 2018
NYMEX Henry Hub
240,000

 
$
3.07

April 2018 - December 2018
NYMEX Henry Hub
160,000

 
$
3.01

January 2019 - March 2019
NYMEX Henry Hub
20,000

 
$
3.37



 
Location
Daily Volume
(Bbls/day)
 
Weighted
Average Price
July 2016 - December 2016
Mont Belvieu
1,500

 
$
19.95


The Company sold call options and used the associated premiums to enhance the fixed price for a portion of the fixed price natural gas swaps listed above. Each short call option has an established ceiling price. When the referenced settlement price is above the price ceiling established by these short call options, the Company pays its counterparty an amount equal to the difference between the referenced settlement price and the price ceiling multiplied by the hedged contract volume.
 
Location
Daily Volume (MMBtu/day)
 
Weighted Average Price
January 2017 - March 2017
NYMEX Henry Hub
105,000

 
$
3.27

April 2017 - December 2017
NYMEX Henry Hub
125,000

 
$
3.21

January 2018 - March 2018
NYMEX Henry Hub
20,000

 
$
2.91

For a portion of the combined natural gas derivative instruments containing fixed price swaps and sold call options, the counterparty has an option to extend the original terms an additional twelve months for the period January 2017 through December 2017. The option to extend the terms expires in December 2016. If executed, the Company would have additional fixed price swaps for 30,000 MMBtu per day at a weighted average price of $3.33 per MMBtu and additional short call options for 30,000 MMBtu per day at a weighted average ceiling price of $3.33 per MMBtu.
In addition, the Company has entered into natural gas basis swap positions, which settle on the pricing index to basis differential of MichCon or Tetco M2 to the NYMEX Henry Hub natural gas price. As of June 30, 2016, the Company had the following natural gas basis swap positions for MichCon and Tetco M2, respectively.
 
Location
Daily Volume (MMBtu/day)
 
Hedged Differential
July 2016 - December 2016
MichCon
40,000

 
$
0.02

November 2016 - March 2017
Tetco M2
50,000

 
$
(0.59
)
Schedule Of Derivative Instruments In Statement Of Financial Position
The following table presents the fair value of the Company's derivative instruments on a gross basis at June 30, 2016:
 
(In thousands)
Short-term derivative instruments - asset
$
44,672

Long-term derivative instruments - asset
$
14,644

Short-term derivative instruments - liability
$
49,906

Long-term derivative instruments - liability
$
29,269

Derivative Instruments, Gain (Loss)
The following table presents the net gain and loss recognized in gas sales, oil and condensate sales and natural gas liquids sales in the accompanying consolidated statements of operations for the three and six months ended June 30, 2016 and 2015.
 
Net (loss) gain on derivative instruments
 
Three months ended June 30,
 
Six months ended June 30,
 
2016
 
2015
 
2016
 
2015
 
(In thousands)
Gas sales
$
(133,621
)
 
$
(8,087
)
 
$
(76,621
)
 
$
38,453

Oil and condensate sales
(2,628
)
 
(1,995
)
 
(1,346
)
 
1,569

Natural gas liquids sales
(1,143
)
 
—

 
(1,690
)
 
—

Total net (loss) gain
$
(137,392
)
 
$
(10,082
)
 
$
(79,657
)
 
$
40,022