Derivative Instruments (Tables)
|
6 Months Ended |
Jun. 30, 2016 |
Schedule of outstanding commodity derivatives |
As of June 30, 2016, the Company’s fixed price natural gas and NGLs swap contracts under short positions from July 1, 2016 through December 31, 2022 were as follows (abbreviations in the table refer to the index to which the swap position is tied, as follows: TCO=Columbia Gas Transmission; NYMEX=Henry Hub; CGTLA=Columbia Gas Louisiana Onshore; CCG=Chicago City Gate; Mont Belvieu-TET=Mont Belvieu Propane):
|
|
|
|
|
|
|
|
|
|
|
Natural gas MMbtu/day
|
|
Propane Bbls/day
|
|
Weighted average index price
|
|
Three months ending September 30, 2016:
|
|
|
|
|
|
|
|
|
TCO ($/MMBtu)
|
|
60,000
|
|
—
|
|
$
|
4.81
|
|
Dominion South ($/MMBtu)
|
|
272,500
|
|
—
|
|
$
|
5.24
|
|
NYMEX ($/MMBtu)
|
|
1,110,000
|
|
—
|
|
$
|
3.44
|
|
CGTLA ($/MMBtu)
|
|
170,000
|
|
—
|
|
$
|
4.03
|
|
Mont Belvieu-TET ($/Gallon)
|
|
—
|
|
30,000
|
|
$
|
0.58
|
|
Total
|
|
1,612,500
|
|
30,000
|
|
|
|
|
Three months ending December 31, 2016:
|
|
|
|
|
|
|
|
|
TCO ($/MMBtu)
|
|
60,000
|
|
—
|
|
$
|
5.01
|
|
Dominion South ($/MMBtu)
|
|
272,500
|
|
—
|
|
$
|
5.47
|
|
NYMEX ($/MMBtu)
|
|
1,110,000
|
|
—
|
|
$
|
3.57
|
|
CGTLA ($/MMBtu)
|
|
170,000
|
|
—
|
|
$
|
4.20
|
|
Mont Belvieu-TET ($/Gallon)
|
|
—
|
|
30,000
|
|
$
|
0.61
|
|
Total
|
|
1,612,500
|
|
30,000
|
|
|
|
|
Year ending December 31, 2017:
|
|
|
|
|
|
|
|
|
NYMEX ($/MMBtu)
|
|
1,370,000
|
|
—
|
|
$
|
3.39
|
|
CGTLA ($/MMBtu)
|
|
420,000
|
|
—
|
|
$
|
4.27
|
|
CCG ($/MMBtu)
|
|
70,000
|
|
—
|
|
$
|
4.57
|
|
Mont Belvieu-TET ($/Gallon)
|
|
—
|
|
31,500
|
|
$
|
0.42
|
|
Total
|
|
1,860,000
|
|
31,500
|
|
|
|
|
Year ending December 31, 2018:
|
|
|
|
|
|
|
|
|
NYMEX ($/MMBtu)
|
|
2,002,500
|
|
—
|
|
$
|
3.91
|
|
Mont Belvieu-TET ($/Gallon)
|
|
—
|
|
2,000
|
|
$
|
0.65
|
|
Total
|
|
2,002,500
|
|
2,000
|
|
|
|
|
Year ending December 31, 2019:
|
|
|
|
|
|
|
|
|
NYMEX ($/MMBtu)
|
|
2,330,000
|
|
|
|
$
|
3.70
|
|
Year ending December 31, 2020:
|
|
|
|
|
|
|
|
|
NYMEX ($/MMBtu)
|
|
1,377,500
|
|
|
|
$
|
3.66
|
|
Year ending December 31, 2021:
|
|
|
|
|
|
|
|
|
NYMEX ($/MMBtu)
|
|
630,000
|
|
|
|
$
|
3.36
|
|
Year ending December 31, 2022:
|
|
|
|
|
|
|
|
|
NYMEX ($/MMBtu)
|
|
120,000
|
|
|
|
$
|
3.24
|
|
|
Summary of the fair values of derivative instruments, which are not designated as hedges for accounting purposes |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
December 31, 2015
|
|
June 30, 2016
|
|
|
|
Balance sheet location
|
|
Fair value
|
|
Balance sheet location
|
|
Fair value
|
|
|
|
|
|
(In thousands)
|
|
|
|
(In thousands)
|
|
Asset derivatives not designated as hedges for accounting purposes:
|
|
|
|
|
|
|
|
|
|
|
|
Commodity contracts
|
|
Current assets
|
|
$
|
1,009,030
|
|
Current assets
|
|
$
|
429,920
|
|
Commodity contracts
|
|
Long-term assets
|
|
|
2,108,450
|
|
Long-term assets
|
|
|
1,673,907
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total asset derivatives
|
|
|
|
|
3,117,480
|
|
|
|
|
2,103,827
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Liability derivatives not designated as hedges for accounting purposes:
|
|
|
|
|
|
|
|
|
|
|
|
Commodity contracts
|
|
Current liabilities
|
|
|
—
|
|
Current liabilities
|
|
|
2,726
|
|
Commodity contracts
|
|
Long-term liabilities
|
|
|
—
|
|
Long-term liabilities
|
|
|
5,179
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total liability derivatives
|
|
|
|
|
—
|
|
|
|
|
7,905
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net derivatives
|
|
|
|
$
|
3,117,480
|
|
|
|
$
|
2,095,922
|
|
|
Schedule of gross amounts of recognized derivative assets and liabilities, the amounts offset under netting arrangements with counterparties, and the resulting net amounts |
The following table presents the gross amounts of recognized derivative assets and liabilities, the amounts offset under master netting arrangements with counterparties, and the resulting net amounts presented in the consolidated balance sheets as of the dates presented, all at fair value (in thousands):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
December 31, 2015
|
|
June 30, 2016
|
|
|
|
Gross amounts on balance sheet
|
|
Gross amounts offset on balance sheet
|
|
Net amounts
of assets on
balance sheet
|
|
Gross amounts on balance sheet
|
|
Gross amounts offset on balance sheet
|
|
Net amounts
of assets (liabilities) on
balance sheet
|
|
Commodity derivative assets
|
|
$
|
3,163,639
|
|
|
(46,159)
|
|
|
3,117,480
|
|
$
|
2,303,100
|
|
|
(199,273)
|
|
|
2,103,827
|
|
Commodity derivative liabilities
|
|
$
|
—
|
|
|
—
|
|
|
—
|
|
$
|
(8,308)
|
|
|
403
|
|
|
(7,905)
|
|
|
Summary of derivative fair value gains (losses) |
The following is a summary of derivative fair value gains and where such values are recorded in the condensed consolidated statements of operations for three and six months ended June 30, 2015 and 2016 (in thousands):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Statement of operations
|
|
Three months ended June 30,
|
|
Six months ended June 30,
|
|
|
|
location
|
|
2015
|
|
2016
|
|
2015
|
|
2016
|
|
Commodity derivative fair value gains (losses)
|
|
Revenue
|
|
$
|
(2,227)
|
|
|
(684,634)
|
|
$
|
757,327
|
|
|
(404,710)
|
|
|
TCOminusNYMEX |
|
Tabular disclosure of commodity derivatives basis differential positions which settle on the pricing index to basis differential of Columbia Gas (TCO) to the NYMEX Henry Hub natural gas price. |
|
|
|
|
|
|
|
|
|
Natural gas MMbtu/day
|
|
Hedged Differential
|
|
|
|
|
|
|
|
|
Six months ending December 31, 2016:
|
|
290,000
|
|
$
|
(0.45)
|
|
|
|
|
|
|
|
|
Year ending December 31, 2017:
|
|
125,000
|
|
$
|
(0.49)
|
|
|
NYMEXminusTCO |
|
Tabular disclosure of commodity derivatives basis differential positions which settle on the pricing index to basis differential of NYMEX Henry Hub to the Columbia Gas (TCO) natural gas price |
|
|
|
|
|
|
|
|
|
Natural gas MMbtu/day
|
|
Hedged Differential
|
|
|
|
|
|
|
|
|
Six months ending December 31, 2016:
|
|
170,000
|
|
$
|
0.34
|
|
|
|
|
|
|
|
|
Year ending December 31, 2017:
|
|
125,000
|
|
$
|
0.30
|
|
|