Document and Entity Information
Document and Entity Information Document Document - shares | 3 Months Ended | |
Mar. 31, 2017 | Apr. 18, 2017 | |
Entity Information [Line Items] | ||
Entity Registrant Name | PDC ENERGY, INC. | |
Entity Central Index Key | 77,877 | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Large Accelerated Filer | |
Document Type | 10-Q | |
Document Period End Date | Mar. 31, 2017 | |
Document Fiscal Year Focus | 2,017 | |
Document Fiscal Period Focus | Q1 | |
Amendment Flag | false | |
Entity Common Stock, Shares Outstanding | 65,855,290 |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Mar. 31, 2017 | Dec. 31, 2016 |
Current assets: | ||
Cash and cash equivalents | $ 207,624 | $ 244,100 |
Short-term investments | 49,890 | 0 |
Accounts receivable, net | 122,484 | 143,392 |
Fair value of derivatives | 27,047 | 8,791 |
Prepaid expenses and other current assets | 4,726 | 3,542 |
Total current assets | 411,771 | 399,825 |
Properties and equipment, net | 4,098,463 | 4,008,266 |
Fair value of derivatives | 13,921 | 2,386 |
Goodwill | 56,058 | 62,041 |
Other assets | 12,917 | 13,324 |
Total Assets | 4,593,130 | 4,485,842 |
Current liabilities: | ||
Accounts payable | 144,440 | 66,322 |
Production tax liability | 25,065 | 24,767 |
Fair value of derivatives | 26,495 | 53,595 |
Funds held for distribution | 76,067 | 71,339 |
Accrued interest payable | 18,977 | 15,930 |
Other accrued expenses | 26,938 | 38,625 |
Total current liabilities | 317,982 | 270,578 |
Long-term debt | 1,046,461 | 1,043,954 |
Deferred income tax | 427,205 | 400,867 |
Asset retirement obligation | 78,162 | 82,612 |
Fair value of derivatives | 4,302 | 27,595 |
Other liabilities | 47,841 | 37,482 |
Total liabilities | 1,921,953 | 1,863,088 |
Commitments and contingent liabilities | ||
Stockholders' Equity: | ||
Common shares - par value $0.01 per share, 150,000,000 authorized, 65,797,748 and 65,704,568 issued as of March 31, 2017 and December 31, 2016, respectively | 658 | 657 |
Additional paid-in capital | 2,492,276 | 2,489,557 |
Retained earnings | 180,354 | 134,208 |
Treasury shares - at cost, 34,433 and 28,763 as of March 31, 2017 and December 31, 2016, respectively | (2,111) | (1,668) |
Total stockholders' equity | 2,671,177 | 2,622,754 |
Total Liabilities and Stockholders' Equity | $ 4,593,130 | $ 4,485,842 |
Balance Sheet Parenthetical (Pa
Balance Sheet Parenthetical (Parentheticals) - $ / shares | Mar. 31, 2017 | Dec. 31, 2016 |
Common stock, par value | $ 0.01 | $ 0.01 |
Common stock, shares authorized | 150,000,000 | 150,000,000 |
Common stock, shares issued | 65,797,748 | 65,704,568 |
Preferred stock, par value | $ 0.01 | $ 0.01 |
Preferred Stock, Shares Authorized | 50,000,000 | 50,000,000 |
Preferred Stock, Shares Issued | 0 | 0 |
Treasury shares, at cost | 34,433 | 28,763 |
Consolidated Statements of Oper
Consolidated Statements of Operations - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Revenues: | ||
Crude oil, natural gas and NGLs sales | $ 189,692 | $ 75,367 |
Commodity price risk management gain, net of settlements | 80,704 | 11,056 |
Other income | 3,311 | 4,408 |
Total revenues | 273,707 | 90,831 |
Costs, expenses and other: | ||
Lease operating expenses | 19,789 | 15,330 |
Production taxes | 12,399 | 4,071 |
Transportation, gathering and processing expenses | 5,902 | 4,041 |
General and administrative expense | 26,315 | 22,779 |
Exploration, geologic, and geophysical expense | 954 | 210 |
Depreciation, depletion and amortization | 109,316 | 97,388 |
Impairment of properties and equipment | 2,193 | 1,001 |
Accretion of asset retirement obligation | 1,768 | 1,812 |
Gain on sale of properties and equipment | (160) | (84) |
Provision for uncollectible notes receivable | 0 | 44,738 |
Other expenses | 3,528 | 2,578 |
Total cost, expenses and other | 182,004 | 193,864 |
Income (loss) from operations | 91,703 | (103,033) |
Interest expense | (19,467) | (11,894) |
Interest income | 240 | 1,558 |
Income (loss) before income taxes | 72,476 | (113,369) |
Income tax (expense) benefit | (26,330) | 41,839 |
Net income (loss) | $ 46,146 | $ (71,530) |
Earnings per share: | ||
Basic | $ 0.70 | $ (1.72) |
Diluted | $ 0.70 | $ (1.72) |
Weighted-average common shares outstanding | ||
Basic | 65,749 | 41,608 |
Diluted | 66,117 | 41,608 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Net income (loss) | $ 46,146 | $ (71,530) |
Net loss | 46,146 | (71,530) |
Adjustments to net income (loss) to reconcile to net cash provided by operating activities: | ||
Net change in fair value of unsettled derivatives | (80,153) | 55,770 |
Depreciation, depletion and amortization | 109,316 | 97,388 |
Impairment of properties and equipment | 2,193 | 1,001 |
Accretion of asset retirement obligation | 1,768 | 1,812 |
Stock-based compensation | 4,454 | 4,682 |
Gain on sale of properties and equipment | (160) | (84) |
Amortization of debt discount and issuance costs | 3,184 | 1,754 |
Deferred income taxes | 26,280 | (43,372) |
Provision for uncollectible notes receivable | 0 | 44,738 |
Other | 722 | (1,202) |
Changes in assets and liabilities | 25,750 | 10,193 |
Net cash from operating activities | 139,500 | 101,150 |
Cash flows from investing activities: | ||
Capital expenditures for development of crude oil and natural gas properties | (129,826) | (122,309) |
Capital expenditures for development of crude oil and natural gas properties | (821) | (450) |
Acquisition of crude oil and natural gas properties, including final settlement adjustments | 6,181 | 0 |
Proceeds from sale of properties and equipment | 737 | 90 |
Purchases of short-term investments | (49,890) | 0 |
Net cash from investing activities | (173,619) | (122,669) |
Cash flows from financing activities: | ||
Proceeds from sale of equity, net of issuance costs | (8) | 296,578 |
Proceeds from revolving credit facility | 0 | 85,000 |
Repayment of revolving credit facility | 0 | (122,000) |
Other | (2,349) | (364) |
Net cash from financing activities | (2,357) | 259,214 |
Net change in cash and cash equivalents | (36,476) | 237,695 |
Cash and cash equivalents, beginning of period | 244,100 | 850 |
Cash and cash equivalents, end of period | 207,624 | 238,545 |
Cash payments (receipts) for: | ||
Interest, net of capitalized interest | 13,224 | 599 |
Income taxes | (39) | 0 |
Non-cash investing and financing activities: | ||
Change in accounts payable related to purchases of properties and equipment | 69,604 | (23,544) |
Change in asset retirement obligation, with a corresponding change to crude oil and natural gas properties, net of disposals | 1,233 | 404 |
Purchase of properties and equipment under capital leases | $ 1,190 | $ 635 |
NATURE OF OPERATIONS AND BASIS
NATURE OF OPERATIONS AND BASIS OF PRESENTATION | 3 Months Ended |
Mar. 31, 2017 | |
NATURE OF OPERATIONS AND BASIS OF PRESENTATION [Abstract] | |
Nature of Operations | NATURE OF OPERATIONS AND BASIS OF PRESENTATION PDC Energy, Inc. ("PDC", the "Company," "we," "us," or "our") is a domestic independent exploration and production company that produces, develops, and explores for crude oil, natural gas, and NGLs, with primary operations in the Wattenberg Field in Colorado and, beginning in December 2016, the Delaware Basin in Reeves and Culberson Counties, Texas. We also have operations in the Utica Shale in Southeastern Ohio, although management expects to begin the process of divesting these properties later in 2017. Our operations in the Wattenberg Field are focused in the horizontal Niobrara and Codell plays and our Delaware Basin operations are currently focused in the Wolfcamp zones. As of March 31, 2017 , we owned an interest in approximately 2,900 gross productive wells. We are engaged in two operating segments: our oil and gas exploration and production segment and our gas marketing segment. Beginning with the first quarter of 2017, our gas marketing segment does not meet the quantitative thresholds to require disclosure as a separate reportable segment. All of our material operations are attributable to our exploration and production business and, therefore, all of our operations are presented as a single segment for all periods presented. The accompanying unaudited condensed consolidated financial statements include the accounts of PDC, our wholly-owned subsidiaries, and our proportionate share of our four affiliated partnerships. Pursuant to the proportionate consolidation method, our accompanying condensed consolidated financial statements include our pro rata share of assets, liabilities, revenues and expenses of the entities which we proportionately consolidate. All material intercompany accounts and transactions have been eliminated in consolidation. In our opinion, the accompanying condensed consolidated financial statements contain all adjustments, consisting of normal recurring adjustments, necessary for a fair statement of our financial statements for interim periods in accordance with accounting principles generally accepted in the United States of America ("U.S. GAAP") and with the instructions to Form 10-Q and Article 10 of Regulation S-X of the SEC. Accordingly, pursuant to such rules and regulations, certain notes and other financial information included in audited financial statements have been condensed or omitted. The December 31, 2016 condensed consolidated balance sheet data was derived from audited statements, but does not include all disclosures required by U.S. GAAP. The information presented in this Quarterly Report on Form 10-Q should be read in conjunction with our audited consolidated financial statements and notes thereto included in our 2016 Form 10-K. Our results of operations and cash flows for the three months ended March 31, 2017 , are not necessarily indicative of the results to be expected for the full year or any other future period. Certain immaterial reclassifications have been made to our prior period statement of operations to conform to the current period presentation. The reclassifications had no impact on previously reported cash flows, net earnings, earnings per share or stockholders' equity. |
Recent Accounting Standards
Recent Accounting Standards | 3 Months Ended |
Mar. 31, 2017 | |
Accounting Policies [Abstract] | |
Significant Accounting Policies | Recently Issued Accounting Standards In May 2014, the FASB and the International Accounting Standards Board issued their converged standard on revenue recognition that provides a single, comprehensive model that entities will apply to determine the measurement of revenue and timing of when it is recognized. The underlying principle is that an entity will recognize revenue to depict the transfer of goods or services to customers at an amount that the entity expects to be entitled to in exchange for those goods or services. The standard outlines a five-step approach to apply the underlying principle: (1) identify the contract with the customer, (2) identify the separate performance obligations in the contract, (3) determine the transaction price, (4) allocate the transaction price to separate performance obligations, and (5) recognize revenue when or as each performance obligation is satisfied. In March 2016, the FASB issued an update to the standard intended to improve the operability and understandability of the implementation guidance on principal versus agent considerations when recognizing revenue. In December 2016, the FASB issued technical corrections and improvements to the standard. The revenue standard is effective for annual reporting periods beginning after December 15, 2017, including interim periods within that reporting period. The revenue standard can be adopted under the full retrospective method or simplified transition method. Entities are permitted to adopt the revenue standard early, beginning with annual reporting periods after December 15, 2016. We are in the process of assessing potential impacts of the new standard on our existing revenue recognition criteria, as well as on related revenue recognition disclosures. In February 2016, the FASB issued an accounting update aimed at increasing the transparency and comparability among organizations by recognizing lease assets and liabilities on the balance sheet and disclosing key information about related leasing arrangements. For leases with terms of more than 12 months, the accounting update requires lessees to recognize a right-of-use asset and lease liability for its right to use the underlying asset and the corresponding lease obligation. Both the lease asset and liability will initially be measured at the present value of the future minimum lease payments over the lease term. Subsequent measurement, including the presentation of expenses and cash flows, will depend upon the classification of the lease as either a finance or operating lease. The guidance is effective for fiscal years beginning after December 15, 2018, and interim periods within those years, with early adoption permitted, and is to be applied as of the beginning of the earliest period presented using a modified retrospective approach. We are in the process of assessing the impact these changes may have on our consolidated financial statements. In August 2016, the FASB issued an accounting update on statements of cash flows to address diversity in practice in how certain cash receipts and cash payments are presented and classified in the statement of cash flows. The update addresses eight specific cash flow issues with the objective of reducing the existing diversity in practice. The guidance is effective for fiscal years beginning after December 15, 2017, and interim periods within those fiscal years, with early adoption permitted. We are currently evaluating the impact these changes may have on our consolidated financial statements. In January 2017, the FASB issued an accounting update clarifying the definition of a business with the objective of adding guidance to assist entities with evaluating whether transactions should be accounted for as acquisitions or disposals of assets or businesses. This guidance is to be applied using a prospective method and is effective for fiscal years beginning after December 15, 2017, and interim periods within those fiscal years, with early adoption permitted. We are currently evaluating the impact these changes may have on our consolidated financial statements. In January 2017, the FASB issued an accounting update to simplify the subsequent measurement of goodwill. The update eliminates a step in the determination of whether goodwill should be considered impaired. The annual and/or interim assessments are still required to be completed. The guidance is effective for fiscal years beginning after December 15, 2019, and interim periods within those fiscal years, with early adoption permitted. We are currently evaluating the impact these changes may have on our consolidated financial statements. |
Business Combination Business C
Business Combination Business Combinations (Notes) | 3 Months Ended |
Mar. 31, 2017 | |
Business Combinations [Abstract] | |
Business Combination Disclosure [Text Block] | BUSINESS COMBINATION Delaware Basin Acquisition. On December 6, 2016, we closed on an acquisition which has been accounted for as a business combination. The transaction was for the purchase of approximately 57,900 net acres, approximately 30 wells and related midstream infrastructure in Reeves and Culberson Counties, Texas, for an aggregate consideration to the sellers of approximately $1.64 billion , comprised of approximately $946.0 million in cash, including the payment of $40.0 million of debt of the seller at closing and other purchase price adjustments, and 9.4 million shares of our common stock valued at approximately $690.7 million at the time the acquisition closed. The estimated fair value of assets acquired and liabilities assumed in the acquisition presented below are preliminary and subject to customary additional post-closing adjustments as more detailed analysis associated with the acquired properties is completed. As of the date of this report, the final settlement statement has been agreed upon with the sellers. We are in the process of finalizing the fair values of the assets acquired and liabilities assumed and expect to keep the transaction open through the second quarter of 2017 to ensure that any post-closing adjustments associated with the period through final settlement are appropriately reflected in the final purchase price allocation. The details of the estimated purchase price and the preliminary allocation of the purchase price for the transaction, which reflects certain post-closing adjustments, are presented below (in thousands): March 31, 2017 Acquisition costs: Cash, net of cash acquired $ 905,962 Retirement of seller's debt 40,000 Total cash consideration 945,962 Common stock, 9.4 million shares 690,702 Other purchase price adjustments 1,025 Total acquisition costs $ 1,637,689 Recognized amounts of identifiable assets acquired and liabilities assumed: Assets acquired: Current assets $ 7,173 Crude oil and natural gas properties - proved 216,000 Crude oil and natural gas properties - unproved 1,721,334 Infrastructure, pipeline, and other 33,695 Construction in progress 12,148 Goodwill 56,058 Total assets acquired 2,046,408 Liabilities assumed: Current liabilities (24,519 ) Asset retirement obligations (4,248 ) Deferred tax liabilities, net (379,952 ) Total liabilities assumed (408,719 ) Total identifiable net assets acquired $ 1,637,689 The fair value measurements of assets acquired and liabilities assumed are based on inputs that are not observable in the market, and therefore represent Level 3 inputs. The fair values of crude oil and natural gas properties and asset retirement obligations were measured using valuation techniques that convert future cash flows to a single discounted amount. Significant inputs to the valuation of crude oil and natural gas properties include estimates of reserves, future operating and development costs, future commodity prices, estimated future cash flows, and a market-based weighted-average cost of capital rate. These inputs require significant judgments and estimates by management at the time of the valuation and are the most sensitive and subject to change. This acquisition was accounted for under the acquisition method. Accordingly, we conducted assessments of net assets acquired and recognized amounts for identifiable assets acquired and liabilities assumed at their estimated acquisition date fair values, while transaction and integration costs associated with the acquisition were expensed as incurred. Goodwill. Goodwill is calculated as the excess of the purchase price over the fair value of net assets acquired and represents the future economic benefits arising from other assets acquired that could not be individually identified and separately recognized. Among the factors that contributed to a purchase price in excess of the fair value of the net tangible and intangible assets acquired were the acquisition of an element of a workforce and the expected value from operations of the Delaware Basin acquisition to be derived in the future. The amount of goodwill recorded related to the Delaware Basin acquisition has decreased as compared to the initial amount recorded as of December 31, 2016, due to customary purchase price allocations. Such amounts will be finalized with final purchase accounting. Any value assigned to goodwill is not expected to be deductible for income tax purposes. The following table presents the changes in goodwill: Amount (in thousands) Balance at beginning of period, January 1, 2017 $ 62,041 Purchase price adjustments, net of tax (5,983 ) Balance at end of period, March 31, 2017 $ 56,058 With the creation of goodwill from this transaction, we will perform our annual evaluation of goodwill for impairment on an annual basis or when a triggering event occurs, beginning in 2017. We evaluate goodwill for impairment by either performing a qualitative evaluation or a two-step quantitative test, which involves comparing the estimated fair value to the carrying value. In either case, the valuation of goodwill will be a significant estimate as such methods incorporate forward-looking assumptions and estimates. |
Properties and Equipment
Properties and Equipment | 3 Months Ended |
Mar. 31, 2017 | |
Oil and Gas Property [Abstract] | |
Property, Plant and Equipment Disclosure | PROPERTIES AND EQUIPMENT The following table presents the components of properties and equipment, net of accumulated depreciation, depletion, and amortization ("DD&A"): March 31, 2017 December 31, 2016 (in thousands) Properties and equipment, net: Crude oil and natural gas properties Proved $ 3,675,076 $ 3,499,718 Unproved 1,874,552 1,874,671 Total crude oil and natural gas properties 5,549,628 5,374,389 Infrastructure, pipeline, and other 74,046 62,093 Land and buildings 14,896 12,165 Construction in progress 132,776 122,591 Properties and equipment, at cost 5,771,346 5,571,238 Accumulated DD&A (1,672,883 ) (1,562,972 ) Properties and equipment, net $ 4,098,463 $ 4,008,266 The following table presents impairment charges recorded for crude oil and natural gas properties: Three Months Ended March 31, 2017 2016 (in thousands) Impairment of proved and unproved properties $ 2,102 $ 969 Amortization of individually insignificant unproved properties 91 32 Total impairment of properties and equipment $ 2,193 $ 1,001 |
Derivative Financial Instrument
Derivative Financial Instruments | 3 Months Ended |
Mar. 31, 2017 | |
Derivative Instruments Not Designated as Hedging Instruments [Abstract] | |
Derivative Instruments and Hedging Activities Disclosure [Text Block] | COMMODITY DERIVATIVE FINANCIAL INSTRUMENTS Our results of operations and operating cash flows are affected by changes in market prices for crude oil, natural gas, and NGLs. To manage a portion of our exposure to price volatility from producing crude oil, natural gas, and propane, which is an element of NGLs, we enter into commodity derivative contracts to protect against price declines in future periods. While we structure these commodity derivatives to reduce our exposure to changes in price associated with the derivative commodity, they also limit the benefit we might otherwise have received from price increases in the physical market. We believe our commodity derivative instruments continue to be effective in achieving the risk management objectives for which they were intended. As of March 31, 2017 , we had derivative instruments, which were comprised of collars, fixed-price swaps, and basis protection swaps, in place for a portion of our anticipated production through 2018 for a total of 13,912 MBbls of crude oil, 75,615 BBtu of natural gas, and 536 MBbls of propane. Our commodity derivative contracts have been entered into at no cost to us as we hedge our anticipated production at the then-prevailing commodity market prices, without adjustment for premium or discount. We have not elected to designate any of our derivative instruments as cash flow hedges, and therefore these instruments do not qualify for use under hedge accounting. Accordingly, changes in the fair value of our derivative instruments are recorded in the condensed consolidated statements of operations. The following table presents the balance sheet location and fair value amounts of our derivative instruments on the condensed consolidated balance sheets: Fair Value Derivative instruments: Condensed consolidated balance sheet line item March 31, 2017 December 31, 2016 (in thousands) Derivative assets: Current Commodity derivative contracts Fair value of derivatives $ 24,437 $ 8,490 Basis protection derivative contracts Fair value of derivatives 2,610 301 27,047 8,791 Non-current Commodity derivative contracts Fair value of derivatives 11,279 1,123 Basis protection derivative contracts Fair value of derivatives 2,642 1,263 13,921 2,386 Total derivative assets $ 40,968 $ 11,177 Derivative liabilities: Current Commodity derivative contracts Fair value of derivatives $ 26,489 $ 53,565 Basis protection derivative contracts Fair value of derivatives 6 30 26,495 53,595 Non-current Commodity derivative contracts Fair value of derivatives 4,302 27,595 4,302 27,595 Total derivative liabilities $ 30,797 $ 81,190 The following table presents the impact of our derivative instruments on our condensed consolidated statements of operations: Three Months Ended March 31, Condensed consolidated statement of operations line item 2017 2016 (in thousands) Commodity price risk management gain, net Net settlements $ 551 $ 66,831 Net change in fair value of unsettled derivatives 80,153 (55,775 ) Total commodity price risk management gain, net $ 80,704 $ 11,056 Net settlements of commodity derivatives decreased significantly for the three months ended March 31, 2017 , as compared to the three months ended March 31, 2016 . We entered into agreements for the derivative instruments that settled throughout 2016 prior to commodity prices becoming depressed in late 2014. Substantially all of these agreements settled by the end of 2016. Net settlements for the three months ended March 31, 2017 reflect derivative instruments entered into since mid-2014 which approximate recent realized prices. Based upon the forward strip pricing at March 31, 2017 , we expect that settlements will be substantially lower on a relative basis as compared to periods in 2016. All of our financial derivative agreements contain master netting provisions that provide for the net settlement of all contracts through a single payment in the event of early termination. We have elected not to offset the fair value positions recorded on our condensed consolidated balance sheets. The following table reflects the impact of netting agreements on gross derivative assets and liabilities: As of March 31, 2017 Derivative instruments, recorded in condensed consolidated balance sheet, gross Effect of master netting agreements Derivative instruments, net (in thousands) Asset derivatives: Derivative instruments, at fair value $ 40,968 $ (22,720 ) $ 18,248 Liability derivatives: Derivative instruments, at fair value $ 30,797 $ (22,720 ) $ 8,077 As of December 31, 2016 Derivative instruments, recorded in condensed consolidated balance sheet, gross Effect of master netting agreements Derivative instruments, net (in thousands) Asset derivatives: Derivative instruments, at fair value $ 11,177 $ (10,930 ) $ 247 Liability derivatives: Derivative instruments, at fair value $ 81,190 $ (10,930 ) $ 70,260 |
Fair Value Measurements and Dis
Fair Value Measurements and Disclosures | 3 Months Ended |
Mar. 31, 2017 | |
Fair Value Disclosures [Abstract] | |
Fair Value, Measurement Inputs, Disclosure | FAIR VALUE OF FINANCIAL INSTRUMENTS Determination of Fair Value Our fair value measurements are estimated pursuant to a fair value hierarchy that requires us to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. The valuation hierarchy is based upon the transparency of inputs to the valuation of an asset or liability as of the measurement date, giving the highest priority to quoted prices in active markets (Level 1) and the lowest priority to unobservable data (Level 3). In some cases, the inputs used to measure fair value might fall in different levels of the fair value hierarchy. The lowest level input that is significant to a fair value measurement in its entirety determines the applicable level in the fair value hierarchy. Assessing the significance of a particular input to the fair value measurement in its entirety requires judgment, considering factors specific to the asset or liability, and may affect the valuation of the assets and liabilities and their placement within the fair value hierarchy levels. The three levels of inputs that may be used to measure fair value are defined as: Level 1 – Quoted prices (unadjusted) for identical assets or liabilities in active markets. Level 2 – Inputs other than quoted prices included within Level 1 that are either directly or indirectly observable for the asset or liability, including quoted prices for similar assets or liabilities in active markets, quoted prices for identical or similar assets or liabilities in inactive markets, inputs other than quoted prices that are observable for the asset or liability, and inputs that are derived from observable market data by correlation or other means. Level 3 – Unobservable inputs for the asset or liability, including situations where there is little, if any, market activity. Derivative Financial Instruments We measure the fair value of our derivative instruments based upon a pricing model that utilizes market-based inputs, including, but not limited to, the contractual price of the underlying position, current market prices, crude oil and natural gas forward curves, discount rates such as the LIBOR curve for a similar duration of each outstanding position, volatility factors, and nonperformance risk. Nonperformance risk considers the effect of our credit standing on the fair value of derivative liabilities and the effect of our counterparties' credit standings on the fair value of derivative assets. Both inputs to the model are based on published credit default swap rates and the duration of each outstanding derivative position. We validate our fair value measurement through the review of counterparty statements and other supporting documentation, the determination that the source of the inputs is valid, the corroboration of the original source of inputs through access to multiple quotes, if available, or other information and monitoring changes in valuation methods and assumptions. While we use common industry practices to develop our valuation techniques and believe our valuation method is appropriate and consistent with those used by other market participants, changes in our pricing methodologies or the underlying assumptions could result in significantly different fair values. Our basis swaps and crude oil and natural gas fixed-price swaps are included in Level 2 and our collars, physical sales, and propane fixed-price swaps are included in Level 3. The following table presents, for each applicable level within the fair value hierarchy, our derivative assets and liabilities, including both current and non-current portions, measured at fair value on a recurring basis: March 31, 2017 December 31, 2016 Significant Other Significant Total Significant Other Significant Total (in thousands) Assets: Total assets $ 33,483 $ 7,485 $ 40,968 $ 6,350 $ 4,827 $ 11,177 Total liabilities (25,628 ) (5,169 ) (30,797 ) (66,789 ) (14,401 ) (81,190 ) Net asset (liability) $ 7,855 $ 2,316 $ 10,171 $ (60,439 ) $ (9,574 ) $ (70,013 ) The following table presents a reconciliation of our Level 3 assets measured at fair value: Three Months Ended March 31, 2017 2016 (in thousands) Fair value of Level 3 instruments, net asset (liability) beginning of period $ (9,574 ) $ 91,288 Changes in fair value included in condensed consolidated statement of operations line item: Commodity price risk management gain, net 13,360 6,165 Settlements included in statement of operations line items: Commodity price risk management gain, net (1,470 ) (24,258 ) Fair value of Level 3 instruments, net asset end of period $ 2,316 $ 73,195 Net change in fair value of Level 3 unsettled derivatives included in condensed consolidated statement of operations line item: Commodity price risk management gain, net $ 11,427 $ 4,185 The significant unobservable input used in the fair value measurement of our derivative contracts is the implied volatility curve, which is provided by a third-party vendor. A significant increase or decrease in the implied volatility, in isolation, would have a directionally similar effect resulting in a significantly higher or lower fair value measurement of our Level 3 derivative contracts. There has been no change in the methodology we apply to measure the fair value of our Level 3 derivative contracts during the periods covered by this report. Short-term Investments We categorize our short-term investments as held-to-maturity as we have the positive intent and ability to hold the securities to maturity. We have invested in commercial paper with entities with financial ratings in the A1/P1 category. At March 31, 2017 , all of our held-to-maturity securities had maturities within one year of the balance sheet date and we did not realize any losses. Short-term investments in marketable securities potentially subject us to a concentration of credit risk as substantially all of our debt securities are held with one counterparty. We hold our marketable securities with major corporations with high credit standings. The carrying value of our short-term investments approximates fair value due to the short-term maturities of these investments. The amortized cost of our held-to-maturity securities at March 31, 2017 was $49.9 million . We did not hold any short-term investments at December 31, 2016. Non-Derivative Financial Assets and Liabilities The carrying value of the financial instruments included in current assets and current liabilities approximate fair value due to the short-term maturities of these instruments. We utilize fair value on a nonrecurring basis to review our crude oil and natural gas properties and goodwill for possible impairment when events and circumstances indicate a possible decline in the recoverability of the carrying value of such assets. The fair value of the properties is determined based upon estimated future discounted cash flow, a Level 3 input, using estimated production and prices at which we reasonably expect the crude oil and natural gas will be sold. The fair value of the goodwill is determined using either a qualitative method or a quantitative method, both of which utilize market data, a Level 2 input, in the derivation of the value estimation. The portion of our long-term debt related to our revolving credit facility approximates fair value due to the variable nature of related interest rates. We have not elected to account for the portion of our debt related to our senior notes under the fair value option; however, we have determined an estimate of the fair values based on measurements of trading activity and broker and/or dealer quotes, respectively, which are published market prices, and therefore are Level 2 inputs. The table below presents these estimates of the fair value of the portion of our long-term debt related to our senior notes and convertible notes as of March 31, 2017 . Estimated Fair Value Percent of Par (in millions) Senior notes: 2021 Convertible Notes $ 206.0 103.0 % 2022 Senior Notes 530.0 106.0 % 2024 Senior Notes 416.0 104.0 % The carrying value of our capital lease obligations approximates fair value due to the variable nature of the imputed interest rates and the duration of the related vehicle lease. Concentration of Risk Derivative Counterparties. A portion of our liquidity relates to commodity derivative instruments that enable us to manage a portion of our exposure to price volatility from producing crude oil and natural gas. These arrangements expose us to credit risk of nonperformance by our counterparties. We primarily use financial institutions who are also major lenders under our revolving credit facility as counterparties to our commodity derivative contracts; however, an insignificant portion of our commodity derivative instruments may be with other counterparties. To date, we have had no derivative counterparty default losses. We have evaluated the credit risk of our derivative assets from our counterparties using relevant credit market default rates, giving consideration to amounts outstanding for each counterparty and the duration of each outstanding derivative position. Based on our evaluation, we have determined that the potential impact of nonperformance of our current counterparties on the fair value of our derivative instruments is not significant at March 31, 2017 , taking into account the estimated likelihood of nonperformance. Cash and Cash Equivalents. We consider all highly liquid instruments purchased with an original maturity of three months or less to be cash equivalents. Cash and cash equivalents potentially subject us to a concentration of credit risk as substantially all of our deposits held in financial institutions were in excess of the FDIC insurance limits at March 31, 2017 . We maintain our cash and cash equivalents in the form of money market and checking accounts with financial institutions that we believe are creditworthy, and are also major lenders under our revolving credit facility. Notes Receivable . In October 2014, we sold our entire 50 percent ownership interest in PDCM to an unrelated third-party. As part of the consideration, we received a promissory note (the “Promissory Note”) for a principal sum of $39.0 million , bearing varying interest rates. The interest was to be paid quarterly, in arrears and at the option of the issuer, could be paid-in-kind (“PIK Interest”) and any such PIK Interest would be subject to the then current interest rate. We regularly analyze the Promissory Note for evidence of collectability, evaluating factors such as the creditworthiness of the issuer of the Promissory Note and the value of the underlying assets that secure the Promissory Note. Based upon this analysis, during the quarter ended March 31, 2016, we recognized a provision and recorded an allowance for uncollectible notes receivable for the $44.0 million accumulated outstanding balance, including interest. Commencing in the second quarter of 2016, we ceased recognizing interest income on the Promissory Note and began accounting for the interest on the Promissory Note under the cash basis method. We performed this analysis as of March 31, 2017 and, based upon the evaluation of preliminary 2016 year-end financial statements and related information of the issuer and existing market conditions for natural gas, it was determined that collection of the Promissory Note and PIK Interest continued to be doubtful and the full valuation allowance on the Promissory Note remained appropriate as of that date. This evaluation assumed repayment of the Promissory Note would be satisfied exclusively from the existing operations of the issuer of the Promissory Note based on the latest available information. At the end of April 2017, PDC entered into an agreement to sell the Promissory Note to an unrelated third-party buyer. Such agreement transferred all of the Company’s legal right to collect from the issuer of the Promissory Note. The sale of the Promissory Note was for cash consideration of approximately $40.3 million . The transaction closed and all funds were collected simultaneously on the date the definitive agreement to sell the Promissory Note was signed. As an agreement to sell the Promissory Note was not in effect and did not exist at March 31, 2017, this transaction has been deemed to be a subsequent event to be recorded in the second quarter of 2017. Accordingly, the Company reversed $40.3 million of the provision for uncollectible notes receivable in April 2017. |
Income Taxes
Income Taxes | 3 Months Ended |
Mar. 31, 2017 | |
Income Tax Disclosure [Abstract] | |
Income Tax Disclosure | INCOME TAXES We evaluate and update our estimated annual effective income tax rate on a quarterly basis based on current and forecasted operating results and tax laws. Consequently, based upon the mix and timing of our actual annual earnings compared to annual projections, our effective tax rate may vary quarterly and may make quarterly comparisons not meaningful. The quarterly income tax provision is generally comprised of tax expense on income or benefit on loss at the most recent estimated annual effective tax rate, adjusted for the effect of discrete items. The effective tax rate for the three months ended March 31, 2017, was 36.3 percent expense on income compared to 36.9 percent benefit on loss for the three months ended March 31, 2016. The effective tax rate for the three months ended March 31, 2017, includes discrete tax benefits of $1.6 million relating to the excess tax basis recognized with the vesting of stock awards during the three months ended March 31, 2017, which resulted in a 2.2 percent reduction to our effective tax rate. The effective tax rate for the three months ended March 31, 2017, is based upon a full year forecasted tax provision on income and is greater than the statutory federal tax rate, primarily due to state taxes, nondeductible officers’ compensation and nondeductible lobbying expenses, partially offset by stock-based compensation tax deductions. We anticipate the potential for increased periodic volatility in future effective tax rates from the impact of stock-based compensation tax deductions as they are treated as discrete tax items. The effective tax rate for the three months ended March 31, 2016 was based upon a full year forecasted tax benefit on loss and is greater than the statutory federal tax rate, primarily due to state taxes and percentage depletion, partially offset by nondeductible officers’ compensation and nondeductible lobbying expenses. There were no significant discrete tax items recorded during the three months ended March 31, 2016. As of March 31, 2017, there is no liability for unrecognized tax benefits. As of the date of this report, we are current with our income tax filings in all applicable state jurisdictions and are not currently under any state income tax examinations. We continue to voluntarily participate in the Internal Revenue Service's Compliance Assurance Program for the 2016 and 2017 tax years, and received final acceptance of our 2015 federal income tax return and closure of the 2015 tax year during the three months ended March 31, 2017. |
Long-Term Debt
Long-Term Debt | 3 Months Ended |
Mar. 31, 2017 | |
Debt Disclosure [Abstract] | |
Long-term Debt | LONG-TERM DEBT Long-term debt consisted of the following as of: March 31, 2017 December 31, 2016 (in thousands) Senior notes: 1.125% Convertible Notes due 2021: Principal amount $ 200,000 $ 200,000 Unamortized discount (35,727 ) (37,475 ) Unamortized debt issuance costs (4,346 ) (4,584 ) 1.125% Convertible Notes due 2021, net of unamortized discount and debt issuance costs 159,927 157,941 7.75% Senior Notes due 2022: Principal amount 500,000 500,000 Unamortized debt issuance costs (6,162 ) (6,443 ) 7.75% Senior Notes due 2022, net of unamortized debt issuance costs 493,838 493,557 6.125% Senior Notes due 2024: Principal amount 400,000 400,000 Unamortized debt issuance costs (7,304 ) (7,544 ) 6.125% Senior Notes due 2024, net of unamortized debt issuance costs 392,696 392,456 Total senior notes 1,046,461 1,043,954 Revolving credit facility — — Total long-term debt, net of unamortized discount and debt issuance costs $ 1,046,461 $ 1,043,954 Senior Notes 2021 Convertible Notes. In September 2016 , we issued $200.0 million of 1.125% convertible senior notes due 2021 (the "2021 Convertible Notes") in a public offering. The maturity for the payment of principal is September 15, 2021 . Interest at the rate of 1.125% per year is payable in cash semiannually in arrears on each March 15 and September 15 , commencing on March 15, 2017. The conversion stock price at maturity is $85.39 per share. We allocated the gross proceeds of the 2021 Convertible Notes between the liability and equity components of the debt. The initial $160.5 million liability component was determined based on the fair value of similar debt instruments excluding the conversion feature for similar terms and priced on the same day we issued the 2021 Convertible Notes. Approximately $4.8 million in costs associated with the issuance of the 2021 Convertible Note have been capitalized as debt issuance costs. As of March 31, 2017, the unamortized debt discount will be amortized over the remaining contractual term to maturity of the 2021 Convertible Notes using an effective interest rate of 5.8 percent . Upon conversion, the 2021 Convertible Notes may be settled, at our sole election, in shares of our common stock, cash, or a combination of cash and shares of our common stock. We have initially elected a combination settlement method to satisfy our conversion obligation, which allows us to settle the principal amount of the 2021 Convertible Notes in cash and to settle the excess conversion value, if any, in shares, as well as cash in lieu of fractional shares. 2022 Senior Notes. In October 2012 , we issued $500.0 million aggregate principal amount 7.75% senior notes due October 15, 2022 (the “2022 Senior Notes”). The 2022 Senior Notes accrue interest from the date of issuance and interest is payable semi-annually in arrears on April 15 and October 15 . Approximately $11.0 million in costs associated with the issuance of the 2022 Senior Notes have been capitalized as debt issuance costs and are being amortized as interest expense over the life of the notes using the effective interest method. 2024 Senior Notes. In September 2016 , we issued $400.0 million aggregate principal amount of 6.125% senior notes due September 15, 2024 (the “2024 Senior Notes”) in a private placement to qualified institutional buyers. The 2024 Senior Notes accrue interest from the date of issuance and interest is payable semi-annually in arrears on March 15 and September 15 , commencing on March 15, 2017. Approximately $7.8 million in costs associated with the issuance of the 2024 Senior Notes have been capitalized as debt issuance costs and are being amortized as interest expense over the life of the notes using the effective interest method. In January 2017, pursuant to the filing of supplemental indentures for the 2021 Convertible Notes, 2022 Senior Notes, and the 2024 Senior Notes (the "Notes"), our wholly-owned subsidiary, PDC Permian, Inc., became a guarantor of our obligations under the Notes. Accordingly, condensed consolidating financial information for PDC and PDC Permian, Inc. is presented in the footnote titled Subsidiary Guarantor . As of March 31, 2017, we were in compliance with all covenants related to the Notes, and expect to remain in compliance throughout the next 12-month period. Revolving Credit Facility Revolving Credit Facility. The revolving credit facility is available for working capital requirements, capital investments, acquisitions, general corporate purposes and to support letters of credit. The revolving credit facility matures in May 2020 , and provides for a maximum of $1 billion in allowable borrowing capacity, subject to the borrowing base and certain limitations under our senior notes. The borrowing base amount available under the revolving credit facility is based on, among other things, the loan value assigned to the proved reserves attributable to our crude oil and natural gas interests. The borrowing base is subject to a semi-annual redetermination on November 1 and May 1 based upon quantification of our reserves at June 30 and December 31, and is also subject to a redetermination upon the occurrence of certain events. The revolving credit facility is secured by a pledge of the stock of certain of our subsidiaries, mortgages of certain producing crude oil and natural gas properties and substantially all of our and such subsidiaries' other assets. Our affiliated partnerships are not guarantors of our obligations under the revolving credit facility. The current borrowing base and aggregate commitments under the facility are $700 million . The May 1, 2017 redetermination has not been finalized as of the date of this report. As of March 31, 2017 and December 31, 2016 , debt issuance costs related to our revolving credit facility were $8.1 million and $8.8 million , respectively, and are included in other assets on the condensed consolidated balance sheets. We had no outstanding balance on our revolving credit facility as of March 31, 2017 or December 31, 2016 . The outstanding principal amount under the revolving credit facility accrues interest at a varying interest rate that fluctuates with an alternate base rate (equal to the greatest of JPMorgan Chase Bank, N.A.'s prime rate, the federal funds rate plus a premium and the rate for dollar deposits in the London interbank market (“LIBOR”) for one month plus a premium), or at our election, a rate equal to LIBOR for certain time periods. Additionally, commitment fees, interest margin, and other bank fees, charged as a component of interest, vary with our utilization of the facility. As of March 31, 2017 , the applicable interest margin is 1.25 percent for the alternate base rate option or 2.25 percent for the LIBOR option, and the unused commitment fee is 0.50 percent . No principal payments are generally required until the revolving credit facility expires in May 2020, or in the event that the borrowing base falls below the outstanding balance. The revolving credit facility contains covenants customary for agreements of this type, with the most restrictive being certain financial tests on a quarterly basis. The financial tests, as defined per the revolving credit facility, include requirements to: (a) maintain a minimum current ratio of 1.0:1.0 and (b) not exceed a maximum leverage ratio of 4.0:1.0. As of March 31, 2017, we were in compliance with all the revolving credit facility covenants and expect to remain in compliance throughout the next 12-month period. As defined by the revolving credit facility, our current ratio was 3.7 and our leverage ratio was 2.0 as of March 31, 2017. As of March 31, 2017, we had an irrevocable standby letter of credit of approximately $11.7 million in favor of a third-party transportation service provider to secure a firm transportation obligation. As of March 31, 2017, the available funds under our revolving credit facility, including the reduction for the $11.7 million letter of credit, was $688.3 million . |
Other Accrued Expenses Other Ac
Other Accrued Expenses Other Accrued Expenses (Notes) | 3 Months Ended |
Mar. 31, 2017 | |
Other Accrued Expenses [Abstract] | |
Other Income and Other Expense Disclosure [Text Block] | OTHER ACCRUED EXPENSES Other Accrued Expenses. The following table presents the components of other accrued expenses: March 31, 2017 December 31, 2016 (in thousands) Employee benefits $ 7,659 $ 22,282 Asset retirement obligations 12,937 9,775 Environmental expenses 4,624 4,438 Other 1,718 2,130 Other accrued expenses $ 26,938 $ 38,625 |
Capital Leases (Notes)
Capital Leases (Notes) | 3 Months Ended |
Mar. 31, 2017 | |
Capital Leased Assets [Line Items] | |
Capital Leases in Financial Statements of Lessee Disclosure [Text Block] | CAPITAL LEASES We periodically enter into non-cancelable lease agreements for vehicles utilized by our operations and field personnel. These leases are being accounted for as capital leases, as the present value of minimum monthly lease payments, including the residual value guarantee, exceeds 90 percent of the fair value of the leased vehicles at inception of the lease. The following table presents vehicles under capital lease as of March 31, 2017 : March 31, 2017 December 31, 2016 (in thousands) Vehicles $ 4,126 $ 2,975 Accumulated depreciation (973 ) (776 ) $ 3,153 $ 2,199 Future minimum lease payments by year and in the aggregate, under non-cancelable capital leases with terms of one year or more, consist of the following: For the Twelve Months Ending March 31, Amount (in thousands) 2018 $ 1,413 2019 1,376 2020 946 3,735 Less executory cost (155 ) Less amount representing interest (402 ) Present value of minimum lease payments $ 3,178 Short-term capital lease obligations $ 1,108 Long-term capital lease obligations 2,070 $ 3,178 Short-term capital lease obligations are included in other accrued expenses on the condensed consolidated balance sheets. Long-term capital lease obligations are included in other liabilities on the condensed consolidated balance sheets. |
Asset Retirement Obligations
Asset Retirement Obligations | 3 Months Ended |
Mar. 31, 2017 | |
Asset Retirement Obligation Disclosure [Abstract] | |
Asset Retirement Obligation Disclosure | ASSET RETIREMENT OBLIGATIONS The following table presents the changes in carrying amounts of the asset retirement obligations associated with our working interests in crude oil and natural gas properties: Amount (in thousands) Balance at beginning of period, January 1, 2017 $ 92,387 Obligations incurred with development activities 1,232 Accretion expense 1,768 Obligations discharged with asset retirements (4,288 ) Balance at end of period, March 31, 2017 91,099 Less current portion (12,937 ) Long-term portion $ 78,162 Our estimated asset retirement obligations liability is based on historical experience in plugging and abandoning wells, estimated economic lives and estimated plugging and abandonment cost considering federal and state regulatory requirements in effect. The liability is discounted using the credit-adjusted risk-free rate estimated at the time the liability is incurred or revised. As of March 31, 2017, the credit-adjusted risk-free rates used to discount our plugging and abandonment liabilities ranged from 6.5 percent to 8.2 percent. In periods subsequent to initial measurement of the liability, we must recognize period-to-period changes in the liability resulting from the passage of time, revisions to either the amount of the original estimate of undiscounted cash flows or changes in inflation factors, and changes to our credit-adjusted risk-free rate as market conditions warrant. Short-term asset retirement obligations are included in other accrued expenses on the condensed consolidated balance sheets. |
Commitments and Contingencies
Commitments and Contingencies | 3 Months Ended |
Mar. 31, 2017 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies Disclosure | COMMITMENTS AND CONTINGENCIES Firm Transportation, Processing, and Sales Agreements. We enter into contracts that provide firm transportation, sales, and processing agreements on pipeline systems through which we transport or sell crude oil and natural gas. Satisfaction of the volume requirements includes volumes produced by us, purchased from third parties, and produced by our affiliated partnerships and other third-party working, royalty, and overriding royalty interest owners whose volumes we market on their behalf. Our statements of operations reflect our share of these firm transportation costs. These contracts require us to pay these transportation and processing charges whether or not the required volumes are delivered. The following table presents gross volume information related to our long-term firm transportation, sales and processing agreements for pipeline capacity: For the Twelve Months Ending March 31, Area 2018 2019 2020 2021 2022 and Total Expiration Natural gas (MMcf) Wattenberg Field — 5,845 18,849 18,798 84,666 128,158 September 30, 2025 Delaware Basin 13,400 14,600 14,640 11,000 — 53,640 December 31, 2020 Gas Marketing 7,117 7,117 7,136 7,117 9,796 38,283 August 31, 2022 Utica Shale 2,737 2,737 2,745 2,737 6,391 17,347 July 22, 2023 Total 23,254 30,299 43,370 39,652 100,853 237,428 Crude oil (MBbls) Wattenberg Field 2,413 2,413 2,420 602 — 7,848 June 30, 2020 Dollar commitment (in thousands) $ 18,726 $ 24,216 $ 36,799 $ 26,211 $ 86,280 $ 192,232 I n December 2016, in anticipation of our future drilling activities in the Wattenberg Field, we entered into a facilities expansion agreement with our primary midstream provider to expand and improve its natural gas gathering pipelines and processing facilities. The midstream provider is expected to construct a new 200 MMcfd cryogenic plant. We will be bound to the volume requirements in this agreement on the first day of the calendar month after the actual in-service date of the plant, which in the above table is estimated to be September 30, 2018. The agreement requires a baseline volume commitment, consisting of our gross wellhead volume delivered in November 2016, to this midstream provider and an incremental wellhead volume commitment of 51.5 MMcfd for seven years. We may be required to pay a shortfall fee for any volumes under the 51.5 MMcfd incremental commitment. Any shortfall of this volume commitment may be offset, by additional third party producers’ volumes sold to the midstream provider that are greater then a certain total baseline volume. We are also required for the first three years of the contract to guarantee a certain target profit margin to the midstream provider on these incremental volumes. We expect that our development plan will support the utilization of that capacity. We entered into a transportation service agreement for delivery of 40,000 dekatherms per day of our Delaware Basin natural gas production to the Waha market hub in West Texas. The contract is effective May 1, 2017 and is in effect through December 31, 2020. For each of the three months ended March 31, 2017 and March 31, 2016 , commitments for long-term transportation volumes for Wattenberg Field crude oil and Utica Shale natural gas were $0.9 million and were recorded in transportation, gathering, and processing expense in our condensed consolidated statements of operations. During the three months ended March 31, 2017 and March 31, 2016 , long-term firm transportation costs for our gas marketing business associated with the commitments shown above were $2.2 million and $2.4 million , respectively, and were recorded in other expenses in our condensed consolidated statements of operations. Litigation and Legal Items. The Company is involved in various legal proceedings. The Company reviews the status of these proceedings on an ongoing basis and, from time to time, may settle or otherwise resolve these matters on terms and conditions that management believes are in the best interests of the Company. Management has provided the necessary estimated accruals in the accompanying balance sheets where deemed appropriate for litigation and legal related items that are ongoing and not yet concluded. Although the results cannot be known with certainty, we currently believe that the ultimate results of such proceedings will not have a material adverse effect on our financial position, results of operations, or liquidity. Environmental. Due to the nature of the natural gas and oil industry, we are exposed to environmental risks. We have various policies and procedures to minimize and mitigate the risks from environmental contamination. We conduct periodic reviews and simulated drills to identify changes in our environmental risk profile. Liabilities are recorded when environmental damages resulting from past events are probable and the costs can be reasonably estimated. Except as discussed herein, we are not aware of any environmental claims existing as of March 31, 2017 which have not been provided for or would otherwise have a material impact on our financial statements; however, there can be no assurance that current regulatory requirements will not change or that unknown past non-compliance with environmental laws will not be discovered on our properties. Accrued environmental liabilities are recorded in other accrued expenses on the condensed consolidated balance sheets. In August 2015, we received a Clean Air Act Section 114 Information Request (the "Information Request") from the U.S. Environmental Protection Agency ("EPA"). The Information Request sought, among other things, information related to the design, operation, and maintenance of our Wattenberg Field production facilities in the Denver-Julesburg Basin of Colorado. The Information Request focuses on historical operation and design information for 46 of our production facilities and asks that we conduct sampling and analyses at the identified 46 facilities. We responded to the Information Request in January 2016. In December 2016, we received a draft consent decree from the EPA. In addition, in December 2015, we received a Compliance Advisory pursuant to C.R.S. 25-7-115(2) from the Colorado Department of Public Health and Environment's Air Quality Control Commission's Air Pollution Control Division alleging that we failed to design, operate, and maintain certain condensate collection, storage, processing, and handling operations to minimize leakage of volatile organic compounds at 65 facilities consistent with applicable standards under Colorado law. This matter has been combined with the matter discussed above. We have ongoing discussions with the EPA, U.S. Department of Justice, and Colorado Department of Public Health and Environment regarding these matters. The ultimate outcome related to these combined actions has not been determined at this time. |
Common Stock
Common Stock | 3 Months Ended |
Mar. 31, 2017 | |
Equity [Abstract] | |
Disclosure of Share-based Compensation Arrangements by Share-based Payment Award | COMMON STOCK Stock-Based Compensation Plans The following table provides a summary of the impact of our outstanding stock-based compensation plans on the results of operations for the periods presented: Three Months Ended March 31, 2017 2016 (in thousands) Stock-based compensation expense $ 4,453 $ 4,682 Income tax benefit (1,666 ) (1,782 ) Net stock-based compensation expense $ 2,787 $ 2,900 Stock Appreciation Rights ("SARs") The SARs vest ratably over a three-year period and may be exercised at any point after vesting through ten years from the date of issuance. Pursuant to the terms of the awards, upon exercise, the executive officers will receive, in shares of common stock, the excess of the market price of the award on the date of exercise over the market price of the award on the date of issuance . The Compensation Committee of our Board of Directors awarded SARs to our executive officers during the three months ended March 31, 2017 and 2016. The fair value of each SAR award was estimated on the date of grant using a Black-Scholes pricing model using the following assumptions: Three Months Ended March 31, 2017 2016 Expected term of award (in years) 6 6 Risk-free interest rate 2.0 % 1.8 % Expected volatility 53.3 % 54.5 % Weighted-average grant date fair value per share $ 38.58 $ 26.96 The expected term of the award was estimated using historical stock option exercise behavior data. The risk-free interest rate was based on the U.S. Treasury yields approximating the expected life of the award in effect at the time of grant. Expected volatilities were based on our historical volatility. We do not expect to pay or declare dividends in the foreseeable future. The following table presents the changes in our SARs for the three months ended March 31, 2017 : Number of Weighted-Average Average Remaining Contractual Aggregate Intrinsic (in thousands) Outstanding at December 31, 2016 244,078 $ 41.36 6.9 $ 7,620 Awarded 54,142 74.57 — — Outstanding at March 31, 2017 298,220 47.39 7.2 5,123 Exercisable at March 31, 2017 186,248 39.38 6.1 4,279 Total compensation cost related to SARs granted and not yet recognized in our condensed consolidated statement of operations as of March 31, 2017 , was $3.2 million . The cost is expected to be recognized over a weighted-average period of 2.3 years. Restricted Stock Awards Time-Based Awards. The fair value of the time-based restricted shares is amortized ratably over the requisite service period, primarily three years. The time-based shares generally vest ratably on each anniversary following the grant date provided that a participant is continuously employed. The following table presents the changes in non-vested time-based awards to all employees, including executive officers, for the three months ended March 31, 2017 : Shares Weighted-Average Non-vested at December 31, 2016 479,642 $ 56.09 Granted 106,401 73.28 Vested (48,656 ) 50.46 Forfeited (2,244 ) 72.58 Non-vested at March 31, 2017 535,143 59.95 The following table presents the weighted-average grant date fair value per share and related information as of/for the periods presented: As of/Three Months Ended March 31, 2017 2016 (in thousands, except per share data) Total intrinsic value of time-based awards vested $ 3,602 $ 3,072 Total intrinsic value of time-based awards non-vested 33,366 32,687 Market price per common share as of March 31, 62.35 59.45 Weighted-average grant date fair value per share 73.28 51.74 Total compensation cost related to non-vested time-based awards, and not yet recognized in our condensed consolidated statements of operations as of March 31, 2017 , was $21.5 million This cost is expected to be recognized over a weighted-average period of 2.1 years. Market-Based Awards. The fair value of the market-based restricted shares is amortized ratably over the requisite service period, primarily three years. The market-based shares vest if the participant is continuously employed throughout the performance period and the market-based performance measure is achieved, with a maximum vesting period of three years. All compensation cost related to the market-based awards will be recognized if the requisite service period is fulfilled, even if the market condition is not achieved. The Compensation Committee of our Board of Directors awarded a total of 28,069 market-based restricted shares to our executive officers during the three months ended March 31, 2017 . In addition to continuous employment, the vesting of these shares is contingent on our total stockholder return ("TSR"), which is essentially our stock price change including any dividends as compared to the TSR of a group of peer companies. The shares are measured over a three-year period ending on December 31, 2019, and can result in a payout between 0 percent and 200 percent of the total shares awarded. The weighted-average grant date fair value per market-based share for these awards was computed using the Monte Carlo pricing model using the following assumptions: Three Months Ended March 31, 2017 2016 Expected term of award (in years) 3 3 Risk-free interest rate 1.4 % 1.2 % Expected volatility 51.4 % 52.3 % Weighted-average grant date fair value per share $ 94.02 $ 72.54 The expected term of the awards was based on the requisite service period. The risk-free interest rate was based on the U.S. Treasury yields in effect at the time of grant and extrapolated to approximate the life of the award. The expected volatility was based on our historical volatility. The following table presents the change in non-vested market-based awards during the three months ended March 31, 2017 : Shares Weighted-Average Non-vested at December 31, 2016 48,420 $ 64.97 Granted 28,069 94.02 Non-vested at March 31, 2017 76,489 75.63 The following table presents the weighted-average grant date fair value per share and related information as of/for the periods presented: As of /Three Months Ended March 31, 2017 2016 (in thousands, except per share data) Total intrinsic value of market-based awards non-vested $ 4,769 $ 5,697 Market price per common share as of March 31, 62.35 59.45 Weighted-average grant date fair value per share 94.02 72.54 Total compensation cost related to non-vested market-based awards, not yet recognized in our condensed consolidated statements of operations as of March 31, 2017 , was $3.8 million . This cost is expected to be recognized over a weighted-average period of 2.3 years. Preferred Stock We are authorized, pursuant to stockholder approval in 2008, to issue 50,000,000 shares of preferred stock, par value $0.01 per share, which may be issued in one or more series, with such rights, preferences, privileges, and restrictions as shall be fixed by our Board from time to time. As of March 31, 2017 and December 31, 2016, no preferred shares had been issued. |
Earnings per share
Earnings per share | 3 Months Ended |
Mar. 31, 2017 | |
Earnings Per Share [Abstract] | |
Earnings Per Share | EARNINGS PER SHARE Basic earnings per share is computed by dividing net earnings by the weighted-average number of common shares outstanding for the period. Diluted earnings per share is similarly computed, except that the denominator includes the effect, using the treasury stock method, of unvested restricted stock, outstanding SARs, stock options, convertible notes, and shares held pursuant to our non-employee director deferred compensation plan, if including such potential shares of common stock is dilutive. The following table presents a reconciliation of the weighted-average diluted shares outstanding: Three Months Ended March 31, 2017 2016 (in thousands) Weighted-average common shares outstanding - basic 65,749 41,608 Dilutive effect of: Restricted stock 211 — Other equity-based awards 157 — Weighted-average common shares and equivalents outstanding - diluted 66,117 41,608 We reported a net loss for the three months ended March 31, 2016. As a result, our basic and diluted weighted-average common shares outstanding were the same for that period because the effect of the common share equivalents was anti-dilutive. The following table presents the weighted-average common share equivalents excluded from the calculation of diluted earnings per share due to their anti-dilutive effect: Three Months Ended March 31, 2017 2016 (in thousands) Weighted-average common share equivalents excluded from diluted earnings per share due to their anti-dilutive effect: Restricted stock 76 723 Convertible notes — 508 Other equity-based awards 18 100 Total anti-dilutive common share equivalents 94 1,331 In September 2016, we issued the 2021 Convertible Notes, which give the holders the right to convert the aggregate principal amount into 2.3 million shares of our common stock at a conversion price of $85.39 per share. The 2021 Convertible Notes could be included in the diluted earnings per share calculation using the treasury stock method if the average market share price exceeds the $85.39 conversion price during the periods presented. In November 2010, we issued $115.0 million aggregate principal amount of 3.25% convertible senior notes that were due in 2016 ("2016 Convertible Notes"), which gave the holders the right to convert the aggregate principal amount into 2.7 million shares of our common stock at a conversion price of $42.40 per share. The 2016 Convertible Notes matured in May 2016. Prior to maturity, the 2016 Convertible Notes were included in the diluted earnings per share calculation using the treasury stock method when the average market share price exceeded the $42.40 conversion price during the periods presented. Shares issuable upon conversion of the 2021 Convertible Notes and 2016 Convertible Notes were excluded from the diluted earnings per share calculation for the applicable periods as the effect would be anti-dilutive to our earnings per share. |
Subsidiary Guarantor Subsidiary
Subsidiary Guarantor Subsidiary Guarantor (Notes) | 3 Months Ended |
Mar. 31, 2017 | |
Subsidiary Guarantor [Abstract] | |
Guarantees [Text Block] | SUBSIDIARY GUARANTOR Our subsidiary PDC Permian, Inc. guarantees our obligations under our publicly-registered Notes. The following presents the condensed consolidating financial information separately for: (i) PDC Energy, Inc. ("Parent"), the issuer of the guaranteed obligations, including non-material subsidiaries; (ii) PDC Permian, Inc., the guarantor subsidiary ("Guarantor"), as specified in the indentures related to our Notes; (iii) Eliminations representing adjustments to (a) eliminate intercompany transactions between or among Parent, Guarantor, and our other subsidiaries and (b) eliminate the investments in our subsidiaries; (iv) Parent and subsidiaries on a consolidated basis ("Consolidated"). The Guarantor is 100% owned by the Parent beginning in December 2016. The Notes are fully and unconditionally guaranteed on a joint and several basis by the Guarantor. The guarantee is subject to release in limited circumstances only upon the occurrence of certain customary conditions. Each entity in the condensed consolidating financial information follows the same accounting policies as described in the notes to the condensed consolidated financial statements. The following condensed consolidating financial statements have been prepared on the same basis of accounting as our condensed consolidated financial statements. Investments in subsidiaries are accounted for under the equity method. Accordingly, the entries necessary to consolidate the Parent and Guarantor are reflected in the eliminations column. Condensed Consolidating Balance Sheets March 31, 2017 Parent Guarantor Eliminations Consolidated (in thousands) Assets Current assets $ 397,276 $ 14,495 $ — $ 411,771 Properties and equipment, net 1,923,981 2,174,482 — 4,098,463 Intercompany receivable 43,550 — (43,550 ) — Investment in subsidiaries 1,765,386 — (1,765,386 ) — Goodwill — 56,058 — 56,058 Noncurrent assets 26,653 185 — 26,838 Total Assets $ 4,156,846 $ 2,245,220 $ (1,808,936 ) $ 4,593,130 Liabilities and Stockholders' Equity Current liabilities $ 266,368 $ 51,614 $ — $ 317,982 Intercompany payable — 43,550 (43,550 ) — Long-term debt 1,046,461 — — 1,046,461 Other noncurrent liabilities 172,840 384,670 — 557,510 Stockholders' equity 2,671,177 1,765,386 (1,765,386 ) 2,671,177 Total Liabilities and Stockholders' Equity $ 4,156,846 $ 2,245,220 $ (1,808,936 ) $ 4,593,130 Condensed Consolidating Balance Sheets December 31, 2016 Parent Guarantor Eliminations Consolidated (in thousands) Assets Current assets $ 387,309 $ 12,516 $ — $ 399,825 Properties and equipment, net 1,889,419 2,118,847 — 4,008,266 Intercompany receivable 9,415 — (9,415 ) — Investment in subsidiaries 1,765,092 — (1,765,092 ) — Goodwill — 62,041 — 62,041 Noncurrent assets 15,539 171 — 15,710 Total Assets $ 4,066,774 $ 2,193,575 $ (1,774,507 ) $ 4,485,842 Liabilities and Stockholders' Equity Current liabilities $ 235,121 $ 35,457 $ — $ 270,578 Intercompany payable — 9,415 (9,415 ) — Long-term debt 1,043,954 — — 1,043,954 Other noncurrent liabilities 164,945 383,611 — 548,556 Stockholders' equity 2,622,754 1,765,092 (1,765,092 ) 2,622,754 Total Liabilities and Stockholders' Equity $ 4,066,774 $ 2,193,575 $ (1,774,507 ) $ 4,485,842 Condensed Consolidating Statements of Operations Three Months Ended March 31, 2017 Parent Guarantor Eliminations Consolidated (in thousands) Operating and other revenues $ 254,740 $ 18,967 $ — $ 273,707 Operating expenses 37,499 6,681 — 44,180 General and administrative 23,529 2,786 — 26,315 Depreciation depletion and amortization 101,738 7,578 — 109,316 Impairment of properties and equipment 604 1,589 — 2,193 Interest (expense) income (19,357 ) 130 — (19,227 ) Income before income taxes 72,013 463 — 72,476 Income tax expense (26,162 ) (168 ) — (26,330 ) Net income $ 45,851 $ 295 $ — $ 46,146 Condensed Consolidating Statements of Cash Flows Three Months Ended March 31, 2017 Parent Guarantor Eliminations Consolidated (in thousands) Cash flows from operating activities $ 131,661 $ 7,839 $ — $ 139,500 Cash flows from investing activities: Capital expenditures for development of crude oil and natural properties (82,489 ) (47,337 ) — (129,826 ) Capital expenditures for other properties and equipment (890 ) 69 — (821 ) Acquisition of crude oil and natural gas properties, including settlement adjustments — 6,181 — 6,181 Proceeds from sale of properties and equipment 737 — — 737 Purchases of short-term investments (49,890 ) — — (49,890 ) Intercompany transfers — 33,795 (33,795 ) — Net cash from investing activities (132,532 ) (7,292 ) (33,795 ) (173,619 ) Cash flows from financing activities: Proceeds from issuance of equity, net of issuance costs (8 ) — — (8 ) Other (2,339 ) (10 ) — (2,349 ) Intercompany transfers (33,795 ) — 33,795 — Net cash from financing activities (36,142 ) (10 ) 33,795 (2,357 ) Net change in cash and cash equivalents (37,013 ) 537 — (36,476 ) Cash and cash equivalents, beginning of period 240,487 3,613 — 244,100 Cash and cash equivalents, end of period $ 203,474 $ 4,150 $ — $ 207,624 |
Significant Accounting Policies
Significant Accounting Policies (Policies) | 3 Months Ended |
Mar. 31, 2017 | |
Accounting Policies [Abstract] | |
Consolidation, Policy | The accompanying unaudited condensed consolidated financial statements include the accounts of PDC, our wholly-owned subsidiaries, and our proportionate share of our four affiliated partnerships. Pursuant to the proportionate consolidation method, our accompanying condensed consolidated financial statements include our pro rata share of assets, liabilities, revenues and expenses of the entities which we proportionately consolidate. All material intercompany accounts and transactions have been eliminated in consolidation |
Basis of Accounting, Policy | In our opinion, the accompanying condensed consolidated financial statements contain all adjustments, consisting of normal recurring adjustments, necessary for a fair statement of our financial statements for interim periods in accordance with accounting principles generally accepted in the United States of America ("U.S. GAAP") and with the instructions to Form 10-Q and Article 10 of Regulation S-X of the SEC. Accordingly, pursuant to such rules and regulations, certain notes and other financial information included in audited financial statements have been condensed or omitted. The December 31, 2016 condensed consolidated balance sheet data was derived from audited statements, but does not include all disclosures required by U.S. GAAP. The information presented in this Quarterly Report on Form 10-Q should be read in conjunction with our audited consolidated financial statements and notes thereto included in our 2016 Form 10-K. Our results of operations and cash flows for the three months ended March 31, 2017 , are not necessarily indicative of the results to be expected for the full year or any other future period |
Reclassification, Policy | . Certain immaterial reclassifications have been made to our prior period statement of operations to conform to the current period presentation. The reclassifications had no impact on previously reported cash flows, net earnings, earnings per share or stockholders' equity. |
Recently Issued Accounting Policy [Policy Text Block] | SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Recently Issued Accounting Standards In May 2014, the FASB and the International Accounting Standards Board issued their converged standard on revenue recognition that provides a single, comprehensive model that entities will apply to determine the measurement of revenue and timing of when it is recognized. The underlying principle is that an entity will recognize revenue to depict the transfer of goods or services to customers at an amount that the entity expects to be entitled to in exchange for those goods or services. The standard outlines a five-step approach to apply the underlying principle: (1) identify the contract with the customer, (2) identify the separate performance obligations in the contract, (3) determine the transaction price, (4) allocate the transaction price to separate performance obligations, and (5) recognize revenue when or as each performance obligation is satisfied. In March 2016, the FASB issued an update to the standard intended to improve the operability and understandability of the implementation guidance on principal versus agent considerations when recognizing revenue. In December 2016, the FASB issued technical corrections and improvements to the standard. The revenue standard is effective for annual reporting periods beginning after December 15, 2017, including interim periods within that reporting period. The revenue standard can be adopted under the full retrospective method or simplified transition method. Entities are permitted to adopt the revenue standard early, beginning with annual reporting periods after December 15, 2016. We are in the process of assessing potential impacts of the new standard on our existing revenue recognition criteria, as well as on related revenue recognition disclosures. In February 2016, the FASB issued an accounting update aimed at increasing the transparency and comparability among organizations by recognizing lease assets and liabilities on the balance sheet and disclosing key information about related leasing arrangements. For leases with terms of more than 12 months, the accounting update requires lessees to recognize a right-of-use asset and lease liability for its right to use the underlying asset and the corresponding lease obligation. Both the lease asset and liability will initially be measured at the present value of the future minimum lease payments over the lease term. Subsequent measurement, including the presentation of expenses and cash flows, will depend upon the classification of the lease as either a finance or operating lease. The guidance is effective for fiscal years beginning after December 15, 2018, and interim periods within those years, with early adoption permitted, and is to be applied as of the beginning of the earliest period presented using a modified retrospective approach. We are in the process of assessing the impact these changes may have on our consolidated financial statements. In August 2016, the FASB issued an accounting update on statements of cash flows to address diversity in practice in how certain cash receipts and cash payments are presented and classified in the statement of cash flows. The update addresses eight specific cash flow issues with the objective of reducing the existing diversity in practice. The guidance is effective for fiscal years beginning after December 15, 2017, and interim periods within those fiscal years, with early adoption permitted. We are currently evaluating the impact these changes may have on our consolidated financial statements. In January 2017, the FASB issued an accounting update clarifying the definition of a business with the objective of adding guidance to assist entities with evaluating whether transactions should be accounted for as acquisitions or disposals of assets or businesses. This guidance is to be applied using a prospective method and is effective for fiscal years beginning after December 15, 2017, and interim periods within those fiscal years, with early adoption permitted. We are currently evaluating the impact these changes may have on our consolidated financial statements. In January 2017, the FASB issued an accounting update to simplify the subsequent measurement of goodwill. The update eliminates a step in the determination of whether goodwill should be considered impaired. The annual and/or interim assessments are still required to be completed. The guidance is effective for fiscal years beginning after December 15, 2019, and interim periods within those fiscal years, with early adoption permitted. We are currently evaluating the impact these changes may have on our consolidated financial statements. |
Earnings Per Share, Policy | Basic earnings per share is computed by dividing net earnings by the weighted-average number of common shares outstanding for the period. Diluted earnings per share is similarly computed, except that the denominator includes the effect, using the treasury stock method, of unvested restricted stock, outstanding SARs, stock options, convertible notes, and shares held pursuant to our non-employee director deferred compensation plan, if including such potential shares of common stock is dilutive. |
Business Combination Business22
Business Combination Business Combinations (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Business Combinations [Abstract] | |
Business Combination, Segment Allocation [Table Text Block] | The details of the estimated purchase price and the preliminary allocation of the purchase price for the transaction, which reflects certain post-closing adjustments, are presented below (in thousands): March 31, 2017 Acquisition costs: Cash, net of cash acquired $ 905,962 Retirement of seller's debt 40,000 Total cash consideration 945,962 Common stock, 9.4 million shares 690,702 Other purchase price adjustments 1,025 Total acquisition costs $ 1,637,689 Recognized amounts of identifiable assets acquired and liabilities assumed: Assets acquired: Current assets $ 7,173 Crude oil and natural gas properties - proved 216,000 Crude oil and natural gas properties - unproved 1,721,334 Infrastructure, pipeline, and other 33,695 Construction in progress 12,148 Goodwill 56,058 Total assets acquired 2,046,408 Liabilities assumed: Current liabilities (24,519 ) Asset retirement obligations (4,248 ) Deferred tax liabilities, net (379,952 ) Total liabilities assumed (408,719 ) Total identifiable net assets acquired $ 1,637,689 |
Business Combination Goodwill (
Business Combination Goodwill (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Goodwill [Abstract] | |
Schedule of Intangible Assets and Goodwill [Table Text Block] | The following table presents the changes in goodwill: Amount (in thousands) Balance at beginning of period, January 1, 2017 $ 62,041 Purchase price adjustments, net of tax (5,983 ) Balance at end of period, March 31, 2017 $ 56,058 |
Properties and Equipment (Table
Properties and Equipment (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Oil and Gas Property [Abstract] | |
Property, Plant and Equipment | The following table presents the components of properties and equipment, net of accumulated depreciation, depletion, and amortization ("DD&A"): March 31, 2017 December 31, 2016 (in thousands) Properties and equipment, net: Crude oil and natural gas properties Proved $ 3,675,076 $ 3,499,718 Unproved 1,874,552 1,874,671 Total crude oil and natural gas properties 5,549,628 5,374,389 Infrastructure, pipeline, and other 74,046 62,093 Land and buildings 14,896 12,165 Construction in progress 132,776 122,591 Properties and equipment, at cost 5,771,346 5,571,238 Accumulated DD&A (1,672,883 ) (1,562,972 ) Properties and equipment, net $ 4,098,463 $ 4,008,266 |
Impairment of natural gas and crude oil properties | The following table presents impairment charges recorded for crude oil and natural gas properties: Three Months Ended March 31, 2017 2016 (in thousands) Impairment of proved and unproved properties $ 2,102 $ 969 Amortization of individually insignificant unproved properties 91 32 Total impairment of properties and equipment $ 2,193 $ 1,001 |
Derivative Financial Instrume25
Derivative Financial Instruments (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Derivative Instruments Not Designated as Hedging Instruments [Abstract] | |
Schedule of Other Derivatives Not Designated as Hedging Instruments, Statements of Financial Performance and Financial Position, Location [Table Text Block] | The following table presents the balance sheet location and fair value amounts of our derivative instruments on the condensed consolidated balance sheets: Fair Value Derivative instruments: Condensed consolidated balance sheet line item March 31, 2017 December 31, 2016 (in thousands) Derivative assets: Current Commodity derivative contracts Fair value of derivatives $ 24,437 $ 8,490 Basis protection derivative contracts Fair value of derivatives 2,610 301 27,047 8,791 Non-current Commodity derivative contracts Fair value of derivatives 11,279 1,123 Basis protection derivative contracts Fair value of derivatives 2,642 1,263 13,921 2,386 Total derivative assets $ 40,968 $ 11,177 Derivative liabilities: Current Commodity derivative contracts Fair value of derivatives $ 26,489 $ 53,565 Basis protection derivative contracts Fair value of derivatives 6 30 26,495 53,595 Non-current Commodity derivative contracts Fair value of derivatives 4,302 27,595 4,302 27,595 Total derivative liabilities $ 30,797 $ 81,190 The following table presents the impact of our derivative instruments on our condensed consolidated statements of operations: Three Months Ended March 31, Condensed consolidated statement of operations line item 2017 2016 (in thousands) Commodity price risk management gain, net Net settlements $ 551 $ 66,831 Net change in fair value of unsettled derivatives 80,153 (55,775 ) Total commodity price risk management gain, net $ 80,704 $ 11,056 Net settlements of commodity derivatives decreased significantly for the three months ended March 31, 2017 , as compared to the three months ended March 31, 2016 . We entered into agreements for the derivative instruments that settled throughout 2016 prior to commodity prices becoming depressed in late 2014. Substantially all of these agreements settled by the end of 2016. Net settlements for the three months ended March 31, 2017 reflect derivative instruments entered into since mid-2014 which approximate recent realized prices. Based upon the forward strip pricing at March 31, 2017 , we expect that settlements will be substantially lower on a relative basis as compared to periods in 2016. All of our financial derivative agreements contain master netting provisions that provide for the net settlement of all contracts through a single payment in the event of early termination. We have elected not to offset the fair value positions recorded on our condensed consolidated balance sheets. The following table reflects the impact of netting agreements on gross derivative assets and liabilities: As of March 31, 2017 Derivative instruments, recorded in condensed consolidated balance sheet, gross Effect of master netting agreements Derivative instruments, net (in thousands) Asset derivatives: Derivative instruments, at fair value $ 40,968 $ (22,720 ) $ 18,248 Liability derivatives: Derivative instruments, at fair value $ 30,797 $ (22,720 ) $ 8,077 As of December 31, 2016 Derivative instruments, recorded in condensed consolidated balance sheet, gross Effect of master netting agreements Derivative instruments, net (in thousands) Asset derivatives: Derivative instruments, at fair value $ 11,177 $ (10,930 ) $ 247 Liability derivatives: Derivative instruments, at fair value $ 81,190 $ (10,930 ) $ 70,260 |
Fair Value Measurements and D26
Fair Value Measurements and Disclosures (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Fair Value Disclosures [Abstract] | |
Schedule of Fair Value, Assets and Liabilities Measured on Recurring Basis | Our basis swaps and crude oil and natural gas fixed-price swaps are included in Level 2 and our collars, physical sales, and propane fixed-price swaps are included in Level 3. The following table presents, for each applicable level within the fair value hierarchy, our derivative assets and liabilities, including both current and non-current portions, measured at fair value on a recurring basis: March 31, 2017 December 31, 2016 Significant Other Significant Total Significant Other Significant Total (in thousands) Assets: Total assets $ 33,483 $ 7,485 $ 40,968 $ 6,350 $ 4,827 $ 11,177 Total liabilities (25,628 ) (5,169 ) (30,797 ) (66,789 ) (14,401 ) (81,190 ) Net asset (liability) $ 7,855 $ 2,316 $ 10,171 $ (60,439 ) $ (9,574 ) $ (70,013 ) |
Fair Value Assets and Liabilities Unobservable Input Reconciliation | The following table presents a reconciliation of our Level 3 assets measured at fair value: Three Months Ended March 31, 2017 2016 (in thousands) Fair value of Level 3 instruments, net asset (liability) beginning of period $ (9,574 ) $ 91,288 Changes in fair value included in condensed consolidated statement of operations line item: Commodity price risk management gain, net 13,360 6,165 Settlements included in statement of operations line items: Commodity price risk management gain, net (1,470 ) (24,258 ) Fair value of Level 3 instruments, net asset end of period $ 2,316 $ 73,195 Net change in fair value of Level 3 unsettled derivatives included in condensed consolidated statement of operations line item: Commodity price risk management gain, net $ 11,427 $ 4,185 |
Concentration of Risk | |
Schedule of Accounts, Notes, Loans and Financing Receivable [Table Text Block] |
Long-Term Debt (Tables)
Long-Term Debt (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Debt Disclosure [Abstract] | |
Schedule of Long-term Debt Instruments | Long-term debt consisted of the following as of: March 31, 2017 December 31, 2016 (in thousands) Senior notes: 1.125% Convertible Notes due 2021: Principal amount $ 200,000 $ 200,000 Unamortized discount (35,727 ) (37,475 ) Unamortized debt issuance costs (4,346 ) (4,584 ) 1.125% Convertible Notes due 2021, net of unamortized discount and debt issuance costs 159,927 157,941 7.75% Senior Notes due 2022: Principal amount 500,000 500,000 Unamortized debt issuance costs (6,162 ) (6,443 ) 7.75% Senior Notes due 2022, net of unamortized debt issuance costs 493,838 493,557 6.125% Senior Notes due 2024: Principal amount 400,000 400,000 Unamortized debt issuance costs (7,304 ) (7,544 ) 6.125% Senior Notes due 2024, net of unamortized debt issuance costs 392,696 392,456 Total senior notes 1,046,461 1,043,954 Revolving credit facility — — Total long-term debt, net of unamortized discount and debt issuance costs $ 1,046,461 $ 1,043,954 |
Other Accrued Expenses Other 28
Other Accrued Expenses Other Accrued Expenses (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Other Accrued Expenses [Abstract] | |
Schedule of Other Operating Cost and Expense, by Component [Table Text Block] | The following table presents the components of other accrued expenses: March 31, 2017 December 31, 2016 (in thousands) Employee benefits $ 7,659 $ 22,282 Asset retirement obligations 12,937 9,775 Environmental expenses 4,624 4,438 Other 1,718 2,130 Other accrued expenses $ 26,938 $ 38,625 |
Capital Leases (Tables)
Capital Leases (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Capital Leases [Abstract] | |
Schedule of Capital Leased Assets [Table Text Block] | The following table presents vehicles under capital lease as of March 31, 2017 : March 31, 2017 December 31, 2016 (in thousands) Vehicles $ 4,126 $ 2,975 Accumulated depreciation (973 ) (776 ) $ 3,153 $ 2,199 |
Schedule of Future Minimum Lease Payments for Capital Leases [Table Text Block] | Future minimum lease payments by year and in the aggregate, under non-cancelable capital leases with terms of one year or more, consist of the following: For the Twelve Months Ending March 31, Amount (in thousands) 2018 $ 1,413 2019 1,376 2020 946 3,735 Less executory cost (155 ) Less amount representing interest (402 ) Present value of minimum lease payments $ 3,178 Short-term capital lease obligations $ 1,108 Long-term capital lease obligations 2,070 $ 3,178 |
Asset Retirement Obligations (T
Asset Retirement Obligations (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Asset Retirement Obligation Disclosure [Abstract] | |
Schedule of Change in Asset Retirement Obligation | The following table presents the changes in carrying amounts of the asset retirement obligations associated with our working interests in crude oil and natural gas properties: Amount (in thousands) Balance at beginning of period, January 1, 2017 $ 92,387 Obligations incurred with development activities 1,232 Accretion expense 1,768 Obligations discharged with asset retirements (4,288 ) Balance at end of period, March 31, 2017 91,099 Less current portion (12,937 ) Long-term portion $ 78,162 |
Commitments and Contingencies C
Commitments and Contingencies Commitments and Contigencies (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Commitments and Contingencies Disclosure [Abstract] | |
Supply Commitment | : For the Twelve Months Ending March 31, Area 2018 2019 2020 2021 2022 and Total Expiration Natural gas (MMcf) Wattenberg Field — 5,845 18,849 18,798 84,666 128,158 September 30, 2025 Delaware Basin 13,400 14,600 14,640 11,000 — 53,640 December 31, 2020 Gas Marketing 7,117 7,117 7,136 7,117 9,796 38,283 August 31, 2022 Utica Shale 2,737 2,737 2,745 2,737 6,391 17,347 July 22, 2023 Total 23,254 30,299 43,370 39,652 100,853 237,428 Crude oil (MBbls) Wattenberg Field 2,413 2,413 2,420 602 — 7,848 June 30, 2020 Dollar commitment (in thousands) $ 18,726 $ 24,216 $ 36,799 $ 26,211 $ 86,280 $ 192,232 |
Common Stock (Tables)
Common Stock (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Equity [Abstract] | |
Schedule of Compensation Cost for Share-based Payment Arrangements, Allocation of Share-based Compensation Costs by Plan | The following table provides a summary of the impact of our outstanding stock-based compensation plans on the results of operations for the periods presented: Three Months Ended March 31, 2017 2016 (in thousands) Stock-based compensation expense $ 4,453 $ 4,682 Income tax benefit (1,666 ) (1,782 ) Net stock-based compensation expense $ 2,787 $ 2,900 |
Schedule of Share-based Payment Award, Stock Options, Valuation Assumptions | he Compensation Committee of our Board of Directors awarded SARs to our executive officers during the three months ended March 31, 2017 and 2016. The fair value of each SAR award was estimated on the date of grant using a Black-Scholes pricing model using the following assumptions: Three Months Ended March 31, 2017 2016 Expected term of award (in years) 6 6 Risk-free interest rate 2.0 % 1.8 % Expected volatility 53.3 % 54.5 % Weighted-average grant date fair value per share $ 38.58 $ 26.96 |
Schedule of Share-based Compensation, Stock Appreciation Rights Award Activity | The following table presents the changes in our SARs for the three months ended March 31, 2017 : Number of Weighted-Average Average Remaining Contractual Aggregate Intrinsic (in thousands) Outstanding at December 31, 2016 244,078 $ 41.36 6.9 $ 7,620 Awarded 54,142 74.57 — — Outstanding at March 31, 2017 298,220 47.39 7.2 5,123 Exercisable at March 31, 2017 186,248 39.38 6.1 4,279 |
Schedule of Share-based Compensation, Restricted Stock and Restricted Stock Units Activity | The following table presents the changes in non-vested time-based awards to all employees, including executive officers, for the three months ended March 31, 2017 : Shares Weighted-Average Non-vested at December 31, 2016 479,642 $ 56.09 Granted 106,401 73.28 Vested (48,656 ) 50.46 Forfeited (2,244 ) 72.58 Non-vested at March 31, 2017 535,143 59.95 The following table presents the weighted-average grant date fair value per share and related information as of/for the periods presented: As of/Three Months Ended March 31, 2017 2016 (in thousands, except per share data) Total intrinsic value of time-based awards vested $ 3,602 $ 3,072 Total intrinsic value of time-based awards non-vested 33,366 32,687 Market price per common share as of March 31, 62.35 59.45 Weighted-average grant date fair value per share 73.28 51.74 |
Restricted Stock Awards, Market-Based, Valuation assumptions | he Compensation Committee of our Board of Directors awarded a total of 28,069 market-based restricted shares to our executive officers during the three months ended March 31, 2017 . In addition to continuous employment, the vesting of these shares is contingent on our total stockholder return ("TSR"), which is essentially our stock price change including any dividends as compared to the TSR of a group of peer companies. The shares are measured over a three-year period ending on December 31, 2019, and can result in a payout between 0 percent and 200 percent of the total shares awarded. The weighted-average grant date fair value per market-based share for these awards was computed using the Monte Carlo pricing model using the following assumptions: Three Months Ended March 31, 2017 2016 Expected term of award (in years) 3 3 Risk-free interest rate 1.4 % 1.2 % Expected volatility 51.4 % 52.3 % Weighted-average grant date fair value per share $ 94.02 $ 72.54 |
Schedule of Nonvested Performance-based Units Activity | The following table presents the change in non-vested market-based awards during the three months ended March 31, 2017 : Shares Weighted-Average Non-vested at December 31, 2016 48,420 $ 64.97 Granted 28,069 94.02 Non-vested at March 31, 2017 76,489 75.63 The following table presents the weighted-average grant date fair value per share and related information as of/for the periods presented: As of /Three Months Ended March 31, 2017 2016 (in thousands, except per share data) Total intrinsic value of market-based awards non-vested $ 4,769 $ 5,697 Market price per common share as of March 31, 62.35 59.45 Weighted-average grant date fair value per share 94.02 72.54 |
Earnings Per Share (Tables)
Earnings Per Share (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Earnings Per Share [Abstract] | |
Schedule of Earnings Per Share Reconciliation | The following table presents a reconciliation of the weighted-average diluted shares outstanding: Three Months Ended March 31, 2017 2016 (in thousands) Weighted-average common shares outstanding - basic 65,749 41,608 Dilutive effect of: Restricted stock 211 — Other equity-based awards 157 — Weighted-average common shares and equivalents outstanding - diluted 66,117 41,608 |
Schedule of Antidilutive Securities Excluded from Computation of Earnings Per Share | The following table presents the weighted-average common share equivalents excluded from the calculation of diluted earnings per share due to their anti-dilutive effect: Three Months Ended March 31, 2017 2016 (in thousands) Weighted-average common share equivalents excluded from diluted earnings per share due to their anti-dilutive effect: Restricted stock 76 723 Convertible notes — 508 Other equity-based awards 18 100 Total anti-dilutive common share equivalents 94 1,331 |
Subsidiary Guarantor Subsidia34
Subsidiary Guarantor Subsidiary Guarantor (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Subsidiary Guarantor [Abstract] | |
Schedule of Guarantor Obligations [Table Text Block] | The following condensed consolidating financial statements have been prepared on the same basis of accounting as our condensed consolidated financial statements. Investments in subsidiaries are accounted for under the equity method. Accordingly, the entries necessary to consolidate the Parent and Guarantor are reflected in the eliminations column. Condensed Consolidating Balance Sheets March 31, 2017 Parent Guarantor Eliminations Consolidated (in thousands) Assets Current assets $ 397,276 $ 14,495 $ — $ 411,771 Properties and equipment, net 1,923,981 2,174,482 — 4,098,463 Intercompany receivable 43,550 — (43,550 ) — Investment in subsidiaries 1,765,386 — (1,765,386 ) — Goodwill — 56,058 — 56,058 Noncurrent assets 26,653 185 — 26,838 Total Assets $ 4,156,846 $ 2,245,220 $ (1,808,936 ) $ 4,593,130 Liabilities and Stockholders' Equity Current liabilities $ 266,368 $ 51,614 $ — $ 317,982 Intercompany payable — 43,550 (43,550 ) — Long-term debt 1,046,461 — — 1,046,461 Other noncurrent liabilities 172,840 384,670 — 557,510 Stockholders' equity 2,671,177 1,765,386 (1,765,386 ) 2,671,177 Total Liabilities and Stockholders' Equity $ 4,156,846 $ 2,245,220 $ (1,808,936 ) $ 4,593,130 Condensed Consolidating Balance Sheets December 31, 2016 Parent Guarantor Eliminations Consolidated (in thousands) Assets Current assets $ 387,309 $ 12,516 $ — $ 399,825 Properties and equipment, net 1,889,419 2,118,847 — 4,008,266 Intercompany receivable 9,415 — (9,415 ) — Investment in subsidiaries 1,765,092 — (1,765,092 ) — Goodwill — 62,041 — 62,041 Noncurrent assets 15,539 171 — 15,710 Total Assets $ 4,066,774 $ 2,193,575 $ (1,774,507 ) $ 4,485,842 Liabilities and Stockholders' Equity Current liabilities $ 235,121 $ 35,457 $ — $ 270,578 Intercompany payable — 9,415 (9,415 ) — Long-term debt 1,043,954 — — 1,043,954 Other noncurrent liabilities 164,945 383,611 — 548,556 Stockholders' equity 2,622,754 1,765,092 (1,765,092 ) 2,622,754 Total Liabilities and Stockholders' Equity $ 4,066,774 $ 2,193,575 $ (1,774,507 ) $ 4,485,842 Condensed Consolidating Statements of Operations Three Months Ended March 31, 2017 Parent Guarantor Eliminations Consolidated (in thousands) Operating and other revenues $ 254,740 $ 18,967 $ — $ 273,707 Operating expenses 37,499 6,681 — 44,180 General and administrative 23,529 2,786 — 26,315 Depreciation depletion and amortization 101,738 7,578 — 109,316 Impairment of properties and equipment 604 1,589 — 2,193 Interest (expense) income (19,357 ) 130 — (19,227 ) Income before income taxes 72,013 463 — 72,476 Income tax expense (26,162 ) (168 ) — (26,330 ) Net income $ 45,851 $ 295 $ — $ 46,146 Condensed Consolidating Statements of Cash Flows Three Months Ended March 31, 2017 Parent Guarantor Eliminations Consolidated (in thousands) Cash flows from operating activities $ 131,661 $ 7,839 $ — $ 139,500 Cash flows from investing activities: Capital expenditures for development of crude oil and natural properties (82,489 ) (47,337 ) — (129,826 ) Capital expenditures for other properties and equipment (890 ) 69 — (821 ) Acquisition of crude oil and natural gas properties, including settlement adjustments — 6,181 — 6,181 Proceeds from sale of properties and equipment 737 — — 737 Purchases of short-term investments (49,890 ) — — (49,890 ) Intercompany transfers — 33,795 (33,795 ) — Net cash from investing activities (132,532 ) (7,292 ) (33,795 ) (173,619 ) Cash flows from financing activities: Proceeds from issuance of equity, net of issuance costs (8 ) — — (8 ) Other (2,339 ) (10 ) — (2,349 ) Intercompany transfers (33,795 ) — 33,795 — Net cash from financing activities (36,142 ) (10 ) 33,795 (2,357 ) Net change in cash and cash equivalents (37,013 ) 537 — (36,476 ) Cash and cash equivalents, beginning of period 240,487 3,613 — 244,100 Cash and cash equivalents, end of period $ 203,474 $ 4,150 $ — $ 207,624 |
Nature of Operations and Basi35
Nature of Operations and Basis of Presentation Additional Information (Details) | 3 Months Ended |
Mar. 31, 2017 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Oil and gas producing wells, gross | 2,900 |
Number of Operating Segments | 2 |
Business Combination Business36
Business Combination Business Combination (Details) $ in Thousands | 3 Months Ended | |
Mar. 31, 2017USD ($)Wells | Dec. 31, 2016USD ($)a | |
Business Acquisition [Line Items] | ||
Oil and gas producing wells, gross | 2,900 | |
Goodwill, Purchase Accounting Adjustments | $ (5,983) | |
Goodwill | $ 56,058 | $ 62,041 |
Delaware Basin Acquisition [Member] | ||
Business Acquisition [Line Items] | ||
Gas and Oil Area, Developed, Gross | a | 57,900 | |
Oil and gas producing wells, gross | Wells | 30 | |
Payments to Acquire Business Two, Net of Cash Acquired | $ 905,962 | |
Payments for Deposits Applied to Debt Retirements | 40,000 | |
Payments to Acquire Businesses, Gross | 945,962 | |
Business Combination, Consideration Transferred, Equity Interests Issued and Issuable | 690,702 | |
Goodwill, Purchase Accounting Adjustments | 1,025 | |
Business Combination, Consideration Transferred | (1,637,689) | |
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Current Assets, Prepaid Expense and Other Assets | $ 7,173 | |
Business Acquisitions Purchase Price Allocation Proved Natural Gas Properties | 216,000,000 | |
business acquisition purchase price allocation unproved properties | $ 1,721,334 | |
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Equipment | 33,695 | |
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Property, Plant, and Equipment | 12,148 | |
Goodwill | 56,058 | |
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Assets | 2,046,408 | |
Business Combination, Contingent Consideration, Liability, Current | (24,519) | |
Business Acquisition Purchase Price Allocation Asset Retirement Obligation | (4,248) | |
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Deferred Tax Liabilities | (379,952) | |
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Noncurrent Liabilities | (408,719) | |
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Net | $ 1,637,689 |
Business Combination Goodwill37
Business Combination Goodwill (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2017 | Dec. 31, 2016 | |
Goodwill [Line Items] | ||
Goodwill | $ 56,058 | $ 62,041 |
Goodwill, Purchase Accounting Adjustments | $ (5,983) |
Properties and Equipment (Detai
Properties and Equipment (Details) - USD ($) $ in Thousands | Mar. 31, 2017 | Dec. 31, 2016 |
Property, Plant and Equipment | ||
Proved Natural Gas and Crude Oil Properties | $ 3,675,076 | $ 3,499,718 |
Unproved Natural Gas and Crude Oil Properties | 1,874,552 | 1,874,671 |
Total Natural Gas and Crude Oil Properties | 5,549,628 | 5,374,389 |
Equipment and other | 74,046 | 62,093 |
Land and Buildings | 14,896 | 12,165 |
Construction in Progress | 132,776 | 122,591 |
Properties and equipment, at cost | 5,771,346 | 5,571,238 |
Accumulated DD&A | (1,672,883) | (1,562,972) |
Property, Plant and Equipment, Net | $ 4,098,463 | $ 4,008,266 |
Impairment of Natural Gas and C
Impairment of Natural Gas and Crude Oil Properties (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Impairment of natural gas and crude oil properties [Line Items] | ||
Impairment of proved ad unproved properties | $ 2,102 | $ 969 |
Amortization of Individually Insignificant Unproved Properties | 91 | 32 |
Impairment of properties and equipment | $ 2,193 | $ 1,001 |
Derivative Financial Instrume40
Derivative Financial Instruments Additional Information (Details) | Mar. 31, 2017MBbls |
Crude Oil [Member] | |
Derivatives in Place for Anticipated Production | |
Anticipated crude oil production hedged (MBbls) | 13,912 |
Natural Gas [Member] | |
Derivatives in Place for Anticipated Production | |
Anticipated crude oil production hedged (MBbls) | 75,615,000 |
Natural Gas Liquids [Member] | |
Derivatives in Place for Anticipated Production | |
Anticipated crude oil production hedged (MBbls) | 536 |
Fair Value of Derivative and Ba
Fair Value of Derivative and Balance Sheet Location (Details) - USD ($) $ in Thousands | Mar. 31, 2017 | Dec. 31, 2016 |
Derivatives, Fair Value | ||
Derivative Asset, Fair Value, Gross Asset | $ 40,968 | $ 11,177 |
Derivative Liability, Fair Value, Gross Liability | 30,797 | 81,190 |
Current Assets | ||
Derivatives, Fair Value | ||
Fair Value of Derivatives | 2,610 | 301 |
Derivative Asset, Fair Value, Gross Asset | 27,047 | 8,791 |
Non Current Assets | ||
Derivatives, Fair Value | ||
Fair Value of Derivatives | 2,642 | 1,263 |
Derivative Asset, Fair Value, Gross Asset | 13,921 | 2,386 |
Current Liabilities | ||
Derivatives, Fair Value | ||
Fair Value of Derivatives | 6 | 30 |
Derivative Liability, Fair Value, Gross Liability | 26,495 | 53,595 |
Non Current Liabilities | ||
Derivatives, Fair Value | ||
Derivative Liability, Fair Value, Gross Liability | 4,302 | 27,595 |
Commodity Contracts Related to Natural Gas and Crude Oil Sales | Current Assets | ||
Derivatives, Fair Value | ||
Fair Value of Derivatives | 24,437 | 8,490 |
Commodity Contracts Related to Natural Gas and Crude Oil Sales | Non Current Assets | ||
Derivatives, Fair Value | ||
Fair Value of Derivatives | 11,279 | 1,123 |
Commodity Contracts Related to Natural Gas and Crude Oil Sales | Current Liabilities | ||
Derivatives, Fair Value | ||
Fair Value of Derivatives | 26,489 | 53,565 |
Commodity Contracts Related to Natural Gas and Crude Oil Sales | Non Current Liabilities | ||
Derivatives, Fair Value | ||
Derivative Liability, Fair Value, Gross Liability | $ 4,302 | $ 27,595 |
Impact of Derivative Instrument
Impact of Derivative Instruments on Statement of Operations (Details) - Commodity Price Risk Management (loss), net - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Derivative [Line Items] | ||
Net settlements | $ 551 | $ 66,831 |
Net change in fair value of unsettled derivatives | 80,153 | (55,775) |
Total commodity price risk management gain (loss), net | $ 80,704 | $ 11,056 |
Derivative Financial Instrume43
Derivative Financial Instruments Impact of Netting Agreements (Details) - USD ($) $ in Thousands | Mar. 31, 2017 | Dec. 31, 2016 |
Derivative Asset: | ||
Derivative assets, gross | $ 40,968 | $ 11,177 |
Effect of master netting agreements | (22,720) | (10,930) |
Derivative asset, net | 18,248 | 247 |
Derivative Liability: | ||
Derivative liability, gross | 30,797 | 81,190 |
Effect of master netting agreements | (22,720) | (10,930) |
Derivative liability, net | $ 8,077 | $ 70,260 |
Fair Value Measurements and D44
Fair Value Measurements and Disclosures (Details) - USD ($) $ in Thousands | Mar. 31, 2017 | Dec. 31, 2016 |
Fair Value | Significant Other Observable Inputs (Level 2) | ||
Assets and Liabilities at Fair Value | ||
Total assets | $ 33,483 | $ 6,350 |
Total liabilities | (25,628) | (66,789) |
Net asset (fair value) | 7,855 | (60,439) |
Fair Value | Significant Unobservable Inputs (Level 3) | ||
Assets and Liabilities at Fair Value | ||
Total assets | 7,485 | 4,827 |
Total liabilities | (5,169) | (14,401) |
Net asset (fair value) | 2,316 | (9,574) |
Fair Value | Total | ||
Assets and Liabilities at Fair Value | ||
Total assets | 40,968 | 11,177 |
Total liabilities | (30,797) | (81,190) |
Net asset (fair value) | $ 10,171 | $ (70,013) |
1.125% Convertible Senior Notes due 2021 [Member] | ||
Assets and Liabilities at Fair Value | ||
Debt Instrument, Interest Rate, Stated Percentage | 1.125% | |
7.75% senior notes fair value | $ 206,000 | |
7.75% senior notes fair value as percentage of par | 103.00% | |
6.125% Senior Notes due 2024 [Member] | ||
Assets and Liabilities at Fair Value | ||
Debt Instrument, Interest Rate, Stated Percentage | 6.125% | |
7.75% senior notes fair value | $ 530,000 | |
7.75% senior notes fair value as percentage of par | 104.00% | |
7.75% Senior Notes due 2022 [Member] | ||
Assets and Liabilities at Fair Value | ||
Debt Instrument, Interest Rate, Stated Percentage | 7.75% | |
7.75% senior notes fair value | $ 416,000 | |
7.75% senior notes fair value as percentage of par | 106.00% |
Reconciliation of Level 3 Fair
Reconciliation of Level 3 Fair Value Measurements (Details) - Derivative Financial Instrument Net Assets - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Roll-forward of Level 3 Assets | ||
Fair Value, net assets, beginning of period | $ (9,574) | $ 91,288 |
Fair Value, net assets, end of period | 2,316 | 73,195 |
Commodity Price Risk Management (loss), net | ||
Roll-forward of Level 3 Assets | ||
Changes in fair value included in statement of operations line item: | 13,360 | 6,165 |
Settlements included in statement of operations line items: | (1,470) | (24,258) |
Net change in fair value of unsettled derivatives included in statement of operations line item | $ 11,427 | $ 4,185 |
Fair Value Measurements and D46
Fair Value Measurements and Disclosures Notes Receivable (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2017 | Mar. 31, 2016 | Oct. 14, 2014 | |
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Provision for uncollectible notes receivable | $ 0 | $ 44,738 | |
Proceeds from Sale and Collection of Notes Receivable | $ 40,300 | ||
Notes Receivable | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Provision for uncollectible notes receivable | $ 44,000 | ||
Note Receivable - Principal Outstanding | $ 39,000 |
Fair Value Measurements and D47
Fair Value Measurements and Disclosures Short Term Investments (Details) - USD ($) $ in Thousands | Mar. 31, 2017 | Dec. 31, 2016 |
Summary of Investments, Other than Investments in Related Parties, Reportable Data [Line Items] | ||
Short-term investments | $ 49,890 | $ 0 |
Income Taxes (Details)
Income Taxes (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Income Tax Disclosure [Abstract] | ||
Effective Income Tax Rate, Continuing Operations | 36.30% | 36.90% |
Other Tax Expense (Benefit) | $ 1.6 | |
Effective Income Tax Rate Reconciliation, Change in Enacted Tax Rate, Percent | 2.20% |
Schedule of Long-Term Debt (Det
Schedule of Long-Term Debt (Details) - USD ($) $ in Thousands | Mar. 31, 2017 | Dec. 31, 2016 | Sep. 14, 2016 |
Debt Instrument | |||
Total senior notes | $ 1,046,461 | $ 1,043,954 | |
Total debt, net of discount and unamortized debt issuance costs | 1,046,461 | 1,043,954 | |
Long-term debt | 1,046,461 | 1,043,954 | |
1.125% Convertible Senior Notes due 2021 [Member] | |||
Debt Instrument | |||
Principal amount | 200,000 | 200,000 | |
Unamortized Discount | (35,727) | (37,475) | |
Unamortized Debt Issuance Expense | (4,346) | (4,584) | $ (4,800) |
3.25% Convertible senior notes due 2016, net of discount | 159,927 | 157,941 | |
7.75% Senior Notes due 2022 [Member] | |||
Debt Instrument | |||
Unamortized Debt Issuance Expense | (6,162) | (6,443) | |
Principal amount | 500,000 | ||
7.75% Senior notes due 2022, net of unamortized debt issuance costs | 493,838 | 493,557 | |
6.125% Senior Notes due 2024 [Member] | |||
Debt Instrument | |||
Unamortized Debt Issuance Expense | (7,304) | (7,544) | $ (7,800) |
Principal amount | 400,000 | 400,000 | |
7.75% Senior notes due 2022, net of unamortized debt issuance costs | 392,696 | 392,456 | |
Revolving Credit Facility | |||
Debt Instrument | |||
Revolving credit facility | $ 0 | $ 0 |
Long-Term Debt Additional Infor
Long-Term Debt Additional Information (Details) - USD ($) | Oct. 15, 2022 | Sep. 15, 2021 | May 21, 2020 | Sep. 12, 2016 | Oct. 03, 2012 | Mar. 31, 2017 | Sep. 30, 2016 | Dec. 31, 2016 | Sep. 14, 2016 | Nov. 15, 2010 |
Debt Instrument | ||||||||||
3.25% Convertible Note, Conversion Price | $ 85.39 | |||||||||
Debt Instrument, Maturity Date | Sep. 15, 2021 | |||||||||
Debt Issuance Costs, Line of Credit Arrangements, Net | $ 8,100,000 | $ 8,800,000 | ||||||||
Line of Credit Facility, Covenant Compliance | As of March 31, 2017, we were in compliance with all the revolving credit facility covenants and expect to remain in compliance throughout the next 12-month period. As defined by the revolving credit facility, our current ratio was 3.7 and our leverage ratio was 2.0 as of March 31, 2017. | |||||||||
3.25% Convertible Senior Notes due 2016 [Member] | ||||||||||
Debt Instrument | ||||||||||
3.25% Convertible Note, Conversion Price | $ 42.40 | |||||||||
1.125% Convertible Senior Notes due 2021 [Member] | ||||||||||
Debt Instrument | ||||||||||
Debt Instrument, Interest Rate, Stated Percentage | 1.125% | |||||||||
Debt Instrument, Issuance Date | Sep. 12, 2016 | |||||||||
6.125% Senior Notes due 2024 [Member] | ||||||||||
Debt Instrument | ||||||||||
Debt Instrument, Interest Rate, Stated Percentage | 6.125% | |||||||||
Debt Instrument, Issuance Date | Sep. 12, 2016 | |||||||||
7.75% Senior Notes due 2022 [Member] | ||||||||||
Debt Instrument | ||||||||||
Debt Instrument, Interest Rate, Stated Percentage | 7.75% | |||||||||
Debt Instrument, Issuance Date | Oct. 3, 2012 | |||||||||
Debt Instrument, Maturity Date | Oct. 15, 2022 | |||||||||
Payments of Debt Issuance Costs | $ 11,000,000 | |||||||||
Revolving Credit Facility | ||||||||||
Debt Instrument | ||||||||||
Line of Credit Facility, Maximum Borrowing Capacity ($) | $ 1,000,000,000 | |||||||||
Line of Credit Facility, Expiration Date | May 21, 2020 | |||||||||
Debt Instrument, Covenant Description | The revolving credit facility contains covenants customary for agreements of this type, with the most restrictive being certain financial tests on a quarterly basis. The financial tests, as defined per the revolving credit facility, include requirements to: (a) maintain a minimum current ratio of 1.0:1.0 and (b) not exceed a maximum leverage ratio of 4.0:1.0. | |||||||||
Line of Credit Facility, Remaining Borrowing Capacity | $ 688,300,000 | |||||||||
RNG Credit Facility [Member] | ||||||||||
Debt Instrument | ||||||||||
PDC Irrevocable Standby Letter of Credit ($) | $ 11,700,000 | |||||||||
First Payment | 1.125% Convertible Senior Notes due 2021 [Member] | ||||||||||
Debt Instrument | ||||||||||
Debt Instrument, Frequency of Periodic Payment | March 15 | |||||||||
First Payment | 6.125% Senior Notes due 2024 [Member] | ||||||||||
Debt Instrument | ||||||||||
Debt Instrument, Frequency of Periodic Payment | March 15 | |||||||||
First Payment | 7.75% Senior Notes due 2022 [Member] | ||||||||||
Debt Instrument | ||||||||||
Debt Instrument, Frequency of Periodic Payment | April 15 | |||||||||
Second Payment | 1.125% Convertible Senior Notes due 2021 [Member] | ||||||||||
Debt Instrument | ||||||||||
Debt Instrument, Frequency of Periodic Payment | September 15 | |||||||||
Second Payment | 6.125% Senior Notes due 2024 [Member] | ||||||||||
Debt Instrument | ||||||||||
Debt Instrument, Frequency of Periodic Payment | September 15 | |||||||||
Second Payment | 7.75% Senior Notes due 2022 [Member] | ||||||||||
Debt Instrument | ||||||||||
Debt Instrument, Frequency of Periodic Payment | October 15 | |||||||||
Revolving Credit Facility | ||||||||||
Debt Instrument | ||||||||||
Long-term Line of Credit | $ 0 | 0 | ||||||||
Maximum Borrowing Base [Member] | Revolving Credit Facility | ||||||||||
Debt Instrument | ||||||||||
Line of Credit Facility, Maximum Borrowing Capacity ($) | 700,000,000 | |||||||||
1.125% Convertible Senior Notes due 2021 [Member] | ||||||||||
Debt Instrument | ||||||||||
3.25% convertible senior notes fair value | 200,000,000 | 200,000,000 | ||||||||
Liability component of gross proceeds of Convertible Notes | 160,500,000 | |||||||||
Unamortized Debt Issuance Expense | $ (4,346,000) | $ (4,584,000) | $ (4,800,000) | |||||||
Debt Instrument, Interest Rate, Effective Percentage | 5.80% | |||||||||
Alternate Base Rate Option [Member] | ||||||||||
Debt Instrument | ||||||||||
Line of Credit Facility, Interest Rate at Period End | 1.25% | |||||||||
LIBOR Option [Member] | ||||||||||
Debt Instrument | ||||||||||
Line of Credit Facility, Interest Rate at Period End | 2.25% | |||||||||
Unused Commitment Fee [Member] | ||||||||||
Debt Instrument | ||||||||||
Line of Credit Facility, Interest Rate at Period End | 0.50% |
Other Accrued Expenses Other 51
Other Accrued Expenses Other Accrued Expenses (Details) - USD ($) $ in Thousands | Mar. 31, 2017 | Dec. 31, 2016 |
Other Accrued Expenses [Abstract] | ||
Accrued Employee Benefits, Current | $ 7,659 | $ 22,282 |
Asset Retirement Obligation, Current | 12,937 | 9,775 |
Environmental expenses | 4,624 | 4,438 |
Other Accrued Liabilities | 1,718 | 2,130 |
Other Accrued Liabilities, Noncurrent | $ 26,938 | $ 38,625 |
Capital Leases Capital Leases (
Capital Leases Capital Leases (Details) - USD ($) $ in Thousands | Mar. 31, 2017 | Dec. 31, 2016 |
Capital Leased Assets [Line Items] | ||
Vehicles | $ 4,126 | $ 2,975 |
Accumulated Depreciation | (973) | (776) |
Capital Leased Assets, Net | $ 3,153 | $ 2,199 |
Capital Leases Minimum Lease Pa
Capital Leases Minimum Lease Payments (Details) $ in Thousands | Mar. 31, 2017USD ($) |
Capital Leased Assets [Line Items] | |
Future Minimum Payments | $ 3,735 |
Executory Costs | (155) |
Amount representing interest | (402) |
Present Value of Net Minimum Payments | 3,178 |
Short-term Capital Lease Obligations | 1,108 |
Long-Term Capital Lease Obligations | 2,070 |
Total Capital Lease Obligations | 3,178 |
2,017 | |
Capital Leased Assets [Line Items] | |
Future Minimum Payments | 1,413 |
2,018 | |
Capital Leased Assets [Line Items] | |
Future Minimum Payments | 1,376 |
2,019 | |
Capital Leased Assets [Line Items] | |
Future Minimum Payments | $ 946 |
Asset Retirement Obligations (D
Asset Retirement Obligations (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2017 | Mar. 31, 2016 | Dec. 31, 2016 | |
Asset Retirement Obligation, Roll Forward Analysis | |||
Balance at beginning of period, January 1, 2016 | $ 92,387 | ||
Obligations incurred with development activities | 1,232 | ||
Accretion expense | 1,768 | $ 1,812 | |
Obligations discharged asset retirements | (4,288) | ||
Balance end of period, June 30, 2016 | 91,099 | ||
Less current portion | (12,937) | $ (9,775) | |
Long-term portion | $ 78,162 | $ 82,612 |
Commitments and Contingencies55
Commitments and Contingencies Commitments and Contigencies (Details) $ in Thousands | 3 Months Ended |
Mar. 31, 2017USD ($)MMcfMBbls | |
Supply Commitment | |
Oil and Gas Delivery Commitments Volumes (MMcf) | 237,428 |
Dollar Commitment ($ in thousands) | $ | $ 192,232 |
Appalachiain Basin | |
Supply Commitment | |
Oil and Gas Delivery Commitments Volumes (MMcf) | 38,283 |
Utica Shale | |
Supply Commitment | |
Oil and Gas Delivery Commitments Volumes (MMcf) | 17,347 |
Wattenberg Field | |
Supply Commitment | |
Oil and Gas Delivery Commitments Volumes (MMcf) | 128,158 |
Delaware Basin [Member] | |
Supply Commitment | |
Oil and Gas Delivery Commitments Volumes (MMcf) | 53,640 |
First Year Commitment [Member] | |
Supply Commitment | |
Oil and Gas Delivery Commitments Volumes (MMcf) | 23,254 |
Dollar Commitment ($ in thousands) | $ | $ 18,726 |
First Year Commitment [Member] | Appalachiain Basin | |
Supply Commitment | |
Oil and Gas Delivery Commitments Volumes (MMcf) | 7,117 |
First Year Commitment [Member] | Utica Shale | |
Supply Commitment | |
Oil and Gas Delivery Commitments Volumes (MMcf) | 2,737 |
First Year Commitment [Member] | Wattenberg Field | |
Supply Commitment | |
Oil and Gas Delivery Commitments Volumes (MMcf) | 0 |
First Year Commitment [Member] | Delaware Basin [Member] | |
Supply Commitment | |
Oil and Gas Delivery Commitments Volumes (MMcf) | 13,400 |
Second Year Commitment [Member] | |
Supply Commitment | |
Oil and Gas Delivery Commitments Volumes (MMcf) | 30,299 |
Dollar Commitment ($ in thousands) | $ | $ 24,216 |
Second Year Commitment [Member] | Appalachiain Basin | |
Supply Commitment | |
Oil and Gas Delivery Commitments Volumes (MMcf) | 7,117 |
Second Year Commitment [Member] | Utica Shale | |
Supply Commitment | |
Oil and Gas Delivery Commitments Volumes (MMcf) | 2,737 |
Second Year Commitment [Member] | Wattenberg Field | |
Supply Commitment | |
Oil and Gas Delivery Commitments Volumes (MMcf) | 5,845 |
Second Year Commitment [Member] | Delaware Basin [Member] | |
Supply Commitment | |
Oil and Gas Delivery Commitments Volumes (MMcf) | 14,600 |
Third Year Commitment [Member] | |
Supply Commitment | |
Oil and Gas Delivery Commitments Volumes (MMcf) | 43,370 |
Dollar Commitment ($ in thousands) | $ | $ 36,799 |
Third Year Commitment [Member] | Appalachiain Basin | |
Supply Commitment | |
Oil and Gas Delivery Commitments Volumes (MMcf) | 7,136 |
Third Year Commitment [Member] | Utica Shale | |
Supply Commitment | |
Oil and Gas Delivery Commitments Volumes (MMcf) | 2,745 |
Third Year Commitment [Member] | Wattenberg Field | |
Supply Commitment | |
Oil and Gas Delivery Commitments Volumes (MMcf) | 18,849 |
Third Year Commitment [Member] | Delaware Basin [Member] | |
Supply Commitment | |
Oil and Gas Delivery Commitments Volumes (MMcf) | 14,640 |
Fourth Year Commitment [Member] | |
Supply Commitment | |
Oil and Gas Delivery Commitments Volumes (MMcf) | 39,652 |
Dollar Commitment ($ in thousands) | $ | $ 26,211 |
Fourth Year Commitment [Member] | Appalachiain Basin | |
Supply Commitment | |
Oil and Gas Delivery Commitments Volumes (MMcf) | 7,117 |
Fourth Year Commitment [Member] | Utica Shale | |
Supply Commitment | |
Oil and Gas Delivery Commitments Volumes (MMcf) | 2,737 |
Fourth Year Commitment [Member] | Wattenberg Field | |
Supply Commitment | |
Oil and Gas Delivery Commitments Volumes (MMcf) | 18,798 |
Fourth Year Commitment [Member] | Delaware Basin [Member] | |
Supply Commitment | |
Oil and Gas Delivery Commitments Volumes (MMcf) | 11,000 |
commitments 5 years and beyond [Member] | |
Supply Commitment | |
Oil and Gas Delivery Commitments Volumes (MMcf) | 100,853 |
Dollar Commitment ($ in thousands) | $ | $ 86,280 |
commitments 5 years and beyond [Member] | Appalachiain Basin | |
Supply Commitment | |
Oil and Gas Delivery Commitments Volumes (MMcf) | 9,796 |
commitments 5 years and beyond [Member] | Utica Shale | |
Supply Commitment | |
Oil and Gas Delivery Commitments Volumes (MMcf) | 6,391 |
commitments 5 years and beyond [Member] | Wattenberg Field | |
Supply Commitment | |
Oil and Gas Delivery Commitments Volumes (MMcf) | 84,666 |
commitments 5 years and beyond [Member] | Delaware Basin [Member] | |
Supply Commitment | |
Oil and Gas Delivery Commitments Volumes (MMcf) | 0 |
Supply Contract Expiration Date [Member] | Appalachiain Basin | |
Supply Commitment | |
Supply Commitments Contract Expiration Date | Aug. 31, 2022 |
Supply Contract Expiration Date [Member] | Utica Shale | |
Supply Commitment | |
Supply Commitments Contract Expiration Date | Jul. 22, 2023 |
Supply Contract Expiration Date [Member] | Wattenberg Field | |
Supply Commitment | |
Supply Commitments Contract Expiration Date | Sep. 30, 2025 |
Supply Contract Expiration Date [Member] | Delaware Basin [Member] | |
Supply Commitment | |
Supply Commitments Contract Expiration Date | Dec. 31, 2020 |
Crude Oil [Member] | Wattenberg Field | |
Supply Commitment | |
Oil and Gas Delivery Commitments Volumes (MMcf) | MBbls | 7,848 |
Crude Oil [Member] | First Year Commitment [Member] | Wattenberg Field | |
Supply Commitment | |
Oil and Gas Delivery Commitments Volumes (MMcf) | MBbls | 2,413 |
Crude Oil [Member] | Second Year Commitment [Member] | Wattenberg Field | |
Supply Commitment | |
Oil and Gas Delivery Commitments Volumes (MMcf) | MBbls | 2,413 |
Crude Oil [Member] | Third Year Commitment [Member] | Wattenberg Field | |
Supply Commitment | |
Oil and Gas Delivery Commitments Volumes (MMcf) | MBbls | 2,420 |
Crude Oil [Member] | Fourth Year Commitment [Member] | Wattenberg Field | |
Supply Commitment | |
Oil and Gas Delivery Commitments Volumes (MMcf) | MBbls | 602 |
Crude Oil [Member] | commitments 5 years and beyond [Member] | Wattenberg Field | |
Supply Commitment | |
Oil and Gas Delivery Commitments Volumes (MMcf) | MBbls | 0 |
Crude Oil [Member] | Supply Contract Expiration Date [Member] | Wattenberg Field | |
Supply Commitment | |
Supply Commitments Contract Expiration Date | Jun. 30, 2020 |
Commitments and Contingencies A
Commitments and Contingencies Additional information (Details) - USD ($) | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Loss Contingencies [Line Items] | ||
Transportation, gathering and processing expenses | $ 5,902,000 | $ 4,041,000 |
Utica Shale natural gas and Wattenberg Field crude oil [Member] | ||
Loss Contingencies [Line Items] | ||
Transportation, gathering and processing expenses | 900,000 | 900,000 |
Utica Shale natural gas and Wattenberg Field crude oil [Member] | ||
Loss Contingencies [Line Items] | ||
Transportation, gathering and processing expenses | $ 2,200,000 | $ 2,400,000 |
Common Stock Sale of Common Sto
Common Stock Sale of Common Stock (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | ||
Mar. 31, 2017 | Mar. 31, 2016 | Dec. 31, 2016 | |
Class of Stock [Line Items] | |||
Common stock, par value | $ 0.01 | $ 0.01 | |
Proceeds from sale of equity, net of issuance costs | $ (8) | $ 296,578 | |
Common shares - par value | 658 | $ 657 | |
Additional paid-in capital | $ 2,492,276 | $ 2,489,557 | |
Debt Instrument, Convertible, Conversion Price | $ 85.39 |
Share Based Compensation Summar
Share Based Compensation Summary (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Employee Service Share-based Compensation, Allocation of Recognized Period Costs | ||
Stock-based compensation expense | $ 4,453 | $ 4,682 |
Income tax benefit | (1,666) | (1,782) |
Net stock-based compensation expense | $ 2,787 | $ 2,900 |
SARs Fair Value Assumptions (De
SARs Fair Value Assumptions (Details) - Stock Appreciation Rights (SARs) - $ / shares | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Share-based Compensation Arrangement by Share-based Payment Award | ||
Expected term of award | 6 years | 6 years |
Risk-free interest rate | 2.00% | 1.80% |
Expected Volatility | 53.30% | 54.50% |
Granted | $ 38.58 | $ 26.96 |
Schedule of Changes in SARs (De
Schedule of Changes in SARs (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 12 Months Ended | |
Mar. 31, 2017 | Dec. 31, 2016 | Mar. 31, 2017 | |
Share-based Compensation Arrangement by Share-based Payment Award | |||
Share-based Compensation Arrangement by Share-based Payment Award, Terms of Award | The SARs vest ratably over a three-year period and may be exercised at any point after vesting through ten years from the date of issuance. Pursuant to the terms of the awards, upon exercise, the executive officers will receive, in shares of common stock, the excess of the market price of the award on the date of exercise over the market price of the award on the date of issuance | ||
Stock Appreciation Rights (SARs) | |||
Number of SARs | |||
Outstanding beginning of year, January 1, | 244,078 | ||
Awarded | 54,142 | ||
Outstanding at June 30, | 298,220 | 244,078 | |
Exercisable at June 30, | 186,248 | ||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Weighted Average Exercise Price | |||
Outstanding beginning of year, January 1, | $ 41.36 | ||
Awarded | 74.57 | ||
Outstanding at June 30, | $ 47.39 | $ 41.36 | |
Exercisable at June 30, | $ 39.38 | ||
Weighted-Average Remaining Contractual Term (in years) | |||
Outstanding at June 30, | 7 years 2 months 20 days | 6 years 10 months 25 days | |
Exercisable at June 30, | 6 years 1 month | ||
Share based compesation aggregate intrinsic value | |||
Outstanding beginning of year, January 1, | $ 5,123 | $ 7,620 | $ 5,123 |
Outstanding at June 30, | $ 5,123 | $ 7,620 | |
Exercisable at June 30, | 4,279 | ||
Employee Service Share-based Compensation, Nonvested Awards, Total Compensation Cost Not yet Recognized | $ 3,200 | ||
Employee Service Share-based Compensation, Nonvested Awards, Total Compensation Cost Not yet Recognized, Period for Recognition | 2 years 3 months 24 days |
Schedule of Changes in Restrict
Schedule of Changes in Restricted Stock - TIme Based Awards (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Share-based Compensation Arrangement by Share-based Payment Award | ||
Share-based Compensation Arrangement by Share-based Payment Award, Terms of Award | The SARs vest ratably over a three-year period and may be exercised at any point after vesting through ten years from the date of issuance. Pursuant to the terms of the awards, upon exercise, the executive officers will receive, in shares of common stock, the excess of the market price of the award on the date of exercise over the market price of the award on the date of issuance | |
Restricted stock | ||
Share-based Compensation Arrangement by Share-based Payment Award | ||
Share-based Compensation Arrangement by Share-based Payment Award, Terms of Award | The fair value of the time-based restricted shares is amortized ratably over the requisite service period, primarily three years. The time-based shares generally vest ratably on each anniversary following the grant date provided that a participant is continuously employed. | |
Number of Shares | ||
Outstanding beginning of year, January 1, | 479,642 | |
Granted | 106,401 | |
Vested | (48,656) | |
Forfeited | (2,244) | |
Outstanding at June 30, | 535,143 | |
Weighted-Average Grant-Date Fair Value | ||
Outstanding at beginning of year, January 1, | $ 56.09 | |
Granted | 73.28 | $ 51.74 |
Vested | 50.46 | |
Forfeited | 72.58 | |
Outstanding at June 30, | $ 59.95 | |
Total intrinsic value of time based awards vested | $ 3,602 | $ 3,072 |
Total intrinsic value of time-based awards non-vested | $ 33,366 | $ 32,687 |
Market price per common share as of June 30, | $ 62.35 | $ 59.45 |
Employee Service Share-based Compensation, Nonvested Awards, Total Compensation Cost Not yet Recognized | $ 21,500 | |
Employee Service Share-based Compensation, Nonvested Awards, Total Compensation Cost Not yet Recognized, Period for Recognition | 2 years 21 days |
Restricted Stock - Market Based
Restricted Stock - Market Based Awards Fair Value Assumptions (Details) - Restricted Stock - Market Based Awards - $ / shares | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Share-based Compensation Arrangement by Share-based Payment Award | ||
Expected term of award | 3 years | 3 years |
Risk-free interest rate | 1.40% | 1.20% |
Expected Volatility | 51.40% | 52.30% |
Granted | $ 94.02 | $ 72.54 |
Schedule of Changes in Restri63
Schedule of Changes in Restricted Stock - Market Based Awards (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Share-based Compensation Arrangement by Share-based Payment Award | ||
Share-based Compensation Arrangement by Share-based Payment Award, Terms of Award | The SARs vest ratably over a three-year period and may be exercised at any point after vesting through ten years from the date of issuance. Pursuant to the terms of the awards, upon exercise, the executive officers will receive, in shares of common stock, the excess of the market price of the award on the date of exercise over the market price of the award on the date of issuance | |
Restricted Stock - Market Based Awards | ||
Share-based Compensation Arrangement by Share-based Payment Award | ||
Share-based Compensation Arrangement by Share-based Payment Award, Terms of Award | The fair value of the market-based restricted shares is amortized ratably over the requisite service period, primarily three years. The market-based shares vest if the participant is continuously employed throughout the performance period and the market-based performance measure is achieved, with a maximum vesting period of three years. All compensation cost related to the market-based awards will be recognized if the requisite service period is fulfilled, even if the market condition is not achieved. | |
Time based shares granted to executives | 28,069 | |
Number of Shares | ||
Outstanding beginning of year, January 1, | 48,420 | |
Granted | 28,069 | |
Outstanding at June 30, | 76,489 | |
Weighted-Average Grant-Date Fair Value | ||
Outstanding at beginning of year, January 1, | $ 64.97 | |
Granted | 94.02 | $ 72.54 |
Outstanding at June 30, | $ 75.63 | |
Total intrinsic value of market-based awards non-vested | $ 4,769 | $ 5,697 |
Market price per common share as of June 30, | $ 62.35 | $ 59.45 |
Employee Service Share-based Compensation, Nonvested Awards, Total Compensation Cost Not yet Recognized | $ 3,800 | |
Employee Service Share-based Compensation, Nonvested Awards, Total Compensation Cost Not yet Recognized, Period for Recognition | 2 years 3 months 20 days |
Common Stock Preferred Stock (D
Common Stock Preferred Stock (Details) - shares | Mar. 31, 2017 | Dec. 31, 2016 | Jun. 23, 2008 |
Share-based Compensation Arrangement by Share-based Payment Award | |||
Preferred Stock, Shares Authorized | 50,000,000 | 50,000,000 | |
Preferred Stock, Shares Issued | 0 | 0 | |
Preferred Stock [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award | |||
Preferred Stock, Shares Authorized | 50,000,000 | ||
Preferred Stock, Shares Issued | 0 |
Earnings Per Share (Details)
Earnings Per Share (Details) | Nov. 15, 2010shares$ / shares | Mar. 31, 2017shares | Mar. 31, 2016shares | Dec. 31, 2016shares$ / shares |
Reconciliation of Weighted-Average Diluted Shares Outstanding | ||||
Weighted average common shares outstanding - basic | 65,749,000 | 41,608,000 | ||
Weighted Average Number of Shares Outstanding - Diluted | 66,117,000 | 41,608,000 | ||
Anti-dilutive Effect | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount | 94,000 | 1,331,000 | ||
Convertible Senior Note Due 2016 | ||||
3.25% Convertible Note, Shares To Be Received Upon Conversion (in thousands) | 2,300,000 | |||
3.25% Convertible Note, Conversion Price | $ / shares | $ 85.39 | |||
Restricted stock | ||||
Reconciliation of Weighted-Average Diluted Shares Outstanding | ||||
Incremental Common Shares Attributable to Dilutive Effect of Share-based Payment Arrangements | 211,000 | 0 | ||
Anti-dilutive Effect | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount | 76,000 | 723,000 | ||
3.25% Convertible Note [Member] | ||||
Anti-dilutive Effect | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount | 0 | 508,000 | ||
Other equity-based awards | ||||
Reconciliation of Weighted-Average Diluted Shares Outstanding | ||||
Incremental Common Shares Attributable to Dilutive Effect of Share-based Payment Arrangements | 157,000 | 0 | ||
Anti-dilutive Effect | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount | 18,000 | 100,000 | ||
3.25% Convertible Senior Notes due 2016 [Member] | ||||
Convertible Senior Note Due 2016 | ||||
3.25% Convertible Note, Shares To Be Received Upon Conversion (in thousands) | 2,700,000 | |||
3.25% Convertible Note, Conversion Price | $ / shares | $ 42.40 |
Subsidiary Guarantor Condensed
Subsidiary Guarantor Condensed Consolidating Balance Sheets (Details) - USD ($) $ in Thousands | Mar. 31, 2017 | Dec. 31, 2016 |
Assets, Current | $ 411,771 | $ 399,825 |
Properties and equipment, net | 4,098,463 | 4,008,266 |
Intercompany Receivables | 0 | 0 |
Investments in and Advance to Affiliates, Subsidiaries, Associates, and Joint Ventures | 0 | 0 |
Goodwill | 56,058 | 62,041 |
Assets, Noncurrent | 26,838 | 15,710 |
Assets | 4,593,130 | 4,485,842 |
Liabilities, Current | 317,982 | 270,578 |
Intercompany Payable | 0 | 0 |
Long-term debt | 1,046,461 | 1,043,954 |
Other Liabilities and Deferred Revenue, Noncurrent | 557,510 | 548,556 |
Stockholders' Equity Attributable to Parent | 2,671,177 | 2,622,754 |
Liabilities and Equity | 4,593,130 | 4,485,842 |
Parent Company [Member] | ||
Assets, Current | 397,276 | 387,309 |
Properties and equipment, net | 1,923,981 | 1,889,419 |
Intercompany Receivables | 43,550 | 9,415 |
Investments in and Advance to Affiliates, Subsidiaries, Associates, and Joint Ventures | 1,765,386 | 1,765,092 |
Goodwill | 0 | 0 |
Assets, Noncurrent | 26,653 | 15,539 |
Assets | 4,156,846 | 4,066,774 |
Liabilities, Current | 266,368 | 235,121 |
Intercompany Payable | 0 | 0 |
Long-term debt | 1,046,461 | 1,043,954 |
Other Liabilities and Deferred Revenue, Noncurrent | 172,840 | 164,945 |
Stockholders' Equity Attributable to Parent | 2,671,177 | 2,622,754 |
Liabilities and Equity | 4,156,846 | 4,066,774 |
Guarantor Subsidiaries [Member] | ||
Assets, Current | 14,495 | 12,516 |
Properties and equipment, net | 2,174,482 | 2,118,847 |
Intercompany Receivables | 0 | 0 |
Investments in and Advance to Affiliates, Subsidiaries, Associates, and Joint Ventures | 0 | 0 |
Goodwill | 56,058 | 62,041 |
Assets, Noncurrent | 185 | 171 |
Assets | 2,245,220 | 2,193,575 |
Liabilities, Current | 51,614 | 35,457 |
Intercompany Payable | 43,550 | 9,415 |
Long-term debt | 0 | 0 |
Other Liabilities and Deferred Revenue, Noncurrent | 384,670 | 383,611 |
Stockholders' Equity Attributable to Parent | 1,765,386 | 1,765,092 |
Liabilities and Equity | 2,245,220 | 2,193,575 |
Consolidation, Eliminations [Member] | ||
Assets, Current | 0 | 0 |
Properties and equipment, net | 0 | 0 |
Intercompany Receivables | (43,550) | (9,415) |
Investments in and Advance to Affiliates, Subsidiaries, Associates, and Joint Ventures | (1,765,386) | (1,765,092) |
Goodwill | 0 | 0 |
Assets, Noncurrent | 0 | 0 |
Assets | (1,808,936) | (1,774,507) |
Liabilities, Current | 0 | 0 |
Intercompany Payable | (43,550) | (9,415) |
Long-term debt | 0 | 0 |
Other Liabilities and Deferred Revenue, Noncurrent | 0 | 0 |
Stockholders' Equity Attributable to Parent | (1,765,386) | (1,765,092) |
Liabilities and Equity | $ (1,808,936) | $ (1,774,507) |
Subsidiary Guarantor Condense67
Subsidiary Guarantor Condensed Consolidating Statement of Operations (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Revenues | $ 273,707 | $ 90,831 |
Operating Costs and Expenses | 44,180 | |
General and administrative expense | 26,315 | 22,779 |
Depreciation, depletion and amortization | 109,316 | 97,388 |
Impairment of properties and equipment | 2,193 | 1,001 |
Interest Income (Expense), Net | (19,227) | |
Income (Loss) from Continuing Operations before Equity Method Investments, Income Taxes, Noncontrolling Interest | 72,476 | (113,369) |
Income tax (expense) benefit | (26,330) | 41,839 |
Net Income (Loss) Attributable to Parent | 46,146 | $ (71,530) |
Parent Company [Member] | ||
Revenues | 254,740 | |
Operating Costs and Expenses | 37,499 | |
General and administrative expense | 23,529 | |
Depreciation, depletion and amortization | 101,738 | |
Impairment of properties and equipment | 604 | |
Interest Income (Expense), Net | (19,357) | |
Income (Loss) from Continuing Operations before Equity Method Investments, Income Taxes, Noncontrolling Interest | 72,013 | |
Income tax (expense) benefit | (26,162) | |
Net Income (Loss) Attributable to Parent | 45,851 | |
Guarantor Subsidiaries [Member] | ||
Revenues | 18,967 | |
Operating Costs and Expenses | 6,681 | |
General and administrative expense | 2,786 | |
Depreciation, depletion and amortization | 7,578 | |
Impairment of properties and equipment | 1,589 | |
Interest Income (Expense), Net | 130 | |
Income (Loss) from Continuing Operations before Equity Method Investments, Income Taxes, Noncontrolling Interest | 463 | |
Income tax (expense) benefit | (168) | |
Net Income (Loss) Attributable to Parent | 295 | |
Consolidation, Eliminations [Member] | ||
Revenues | 0 | |
Operating Costs and Expenses | 0 | |
General and administrative expense | 0 | |
Depreciation, depletion and amortization | 0 | |
Impairment of properties and equipment | 0 | |
Interest Income (Expense), Net | 0 | |
Income (Loss) from Continuing Operations before Equity Method Investments, Income Taxes, Noncontrolling Interest | 0 | |
Income tax (expense) benefit | 0 | |
Net Income (Loss) Attributable to Parent | $ 0 |
Subsidiary Guarantor Condense68
Subsidiary Guarantor Condensed Consolidating Statement of Cash Flows (Details) - USD ($) $ in Thousands | 3 Months Ended | |||
Mar. 31, 2017 | Mar. 31, 2016 | Dec. 31, 2016 | Dec. 31, 2015 | |
Net Cash Provided by (Used in) Operating Activities | $ 139,500 | $ 101,150 | ||
Capital expenditures for development of crude oil and natural gas properties | (129,826) | (122,309) | ||
Capital expenditures for development of crude oil and natural gas properties | (821) | (450) | ||
Acquisition of crude oil and natural gas properties, including final settlement adjustments | 6,181 | 0 | ||
Proceeds from sale of properties and equipment | 737 | 90 | ||
Purchases of short-term investments | (49,890) | 0 | ||
intercompany Transfer Investing Activities | 0 | |||
Net Cash Provided by (Used in) Investing Activities | (173,619) | (122,669) | ||
Proceeds from sale of equity, net of issuance costs | (8) | 296,578 | ||
Other | (2,349) | (364) | ||
Intercompany Transfers Financing Activities | 0 | |||
Net Cash Provided by (Used in) Financing Activities | (2,357) | 259,214 | ||
Cash and Cash Equivalents, Period Increase (Decrease) | (36,476) | 237,695 | ||
Cash and cash equivalents | 207,624 | $ 238,545 | $ 244,100 | $ 850 |
Parent Company [Member] | ||||
Net Cash Provided by (Used in) Operating Activities | 131,661 | |||
Capital expenditures for development of crude oil and natural gas properties | (82,489) | |||
Capital expenditures for development of crude oil and natural gas properties | (890) | |||
Acquisition of crude oil and natural gas properties, including final settlement adjustments | 0 | |||
Proceeds from sale of properties and equipment | 737 | |||
Purchases of short-term investments | (49,890) | |||
intercompany Transfer Investing Activities | 0 | |||
Net Cash Provided by (Used in) Investing Activities | (132,532) | |||
Proceeds from sale of equity, net of issuance costs | (8) | |||
Other | (2,339) | |||
Intercompany Transfers Financing Activities | (33,795) | |||
Net Cash Provided by (Used in) Financing Activities | (36,142) | |||
Cash and Cash Equivalents, Period Increase (Decrease) | (37,013) | |||
Cash and cash equivalents | 203,474 | 240,487 | ||
Guarantor Subsidiaries [Member] | ||||
Net Cash Provided by (Used in) Operating Activities | 7,839 | |||
Capital expenditures for development of crude oil and natural gas properties | (47,337) | |||
Capital expenditures for development of crude oil and natural gas properties | 69 | |||
Acquisition of crude oil and natural gas properties, including final settlement adjustments | 6,181 | |||
Proceeds from sale of properties and equipment | 0 | |||
Purchases of short-term investments | 0 | |||
intercompany Transfer Investing Activities | 33,795 | |||
Net Cash Provided by (Used in) Investing Activities | (7,292) | |||
Proceeds from sale of equity, net of issuance costs | 0 | |||
Other | (10) | |||
Intercompany Transfers Financing Activities | 0 | |||
Net Cash Provided by (Used in) Financing Activities | (10) | |||
Cash and Cash Equivalents, Period Increase (Decrease) | 537 | |||
Cash and cash equivalents | 4,150 | 3,613 | ||
Consolidation, Eliminations [Member] | ||||
Net Cash Provided by (Used in) Operating Activities | 0 | |||
Capital expenditures for development of crude oil and natural gas properties | 0 | |||
Capital expenditures for development of crude oil and natural gas properties | 0 | |||
Acquisition of crude oil and natural gas properties, including final settlement adjustments | 0 | |||
Proceeds from sale of properties and equipment | 0 | |||
Purchases of short-term investments | 0 | |||
intercompany Transfer Investing Activities | (33,795) | |||
Net Cash Provided by (Used in) Investing Activities | (33,795) | |||
Proceeds from sale of equity, net of issuance costs | 0 | |||
Other | 0 | |||
Intercompany Transfers Financing Activities | 33,795 | |||
Net Cash Provided by (Used in) Financing Activities | 33,795 | |||
Cash and Cash Equivalents, Period Increase (Decrease) | 0 | |||
Cash and cash equivalents | $ 0 | $ 0 |