| Derivative Instruments and Hedging Activities Disclosure [Text Block] |
9. Derivative Financial Instruments
During 2020, 2019 and 2018, we entered into commodity contracts for crude oil and natural gas which related to a portion of our expected production for the time frames covered by the contracts. The crude oil contracts were based on West Texas Intermediate (“WTI”) crude oil prices as quoted off the New York Mercantile Exchange (“NYMEX”). The natural gas contracts are based on Henry Hub natural gas prices as quoted off the NYMEX. The open contracts as of December 31, 2020 are presented in the following tables:
| Crude Oil: Open Swap Contracts, Priced off WTI (NYMEX) |
|
| Period |
|
Notional Quantity (Bbls/day) |
|
|
Notional Quantity (Bbls) |
|
|
Weighted Strike Price |
|
| Jan 2021 - Dec 2021 |
|
|
4,000 |
|
|
|
1,460,000 |
|
|
$ |
42.06 |
|
| Jan 2022 - Feb 2022 |
|
|
3,000 |
|
|
|
177,000 |
|
|
$ |
42.98 |
|
| Mar 2022 - May 2022 |
|
|
2,044 |
|
|
|
188,006 |
|
|
$ |
42.33 |
|
| Crude Oil: Open Collar Contracts - Priced off WTI (NYMEX) |
|
| Period |
|
Notional Quantity (Bbls/day) |
|
|
Notional Quantity (Bbls) |
|
|
Put Option Weighted Strike Price (Bought) |
|
|
Call Option Weighted Strike Price (Sold) |
|
| Jan.2021 - Feb 2022 |
|
|
1,770 |
|
|
|
750,422 |
|
|
$ |
35.00 |
|
|
$ |
50.00 |
|
| Mar 2022 - May 2022 |
|
|
2,000 |
|
|
|
184,000 |
|
|
$ |
35.00 |
|
|
$ |
48.50 |
|
| Natural Gas: Open Call Contracts, Bought, Priced off Henry Hub (NYMEX) |
|
| Period |
|
Notional Quantity (MMBtu/day) |
|
|
Notional Quantity (MMBtu) |
|
|
Strike Price |
|
| Feb 2021 - Dec. 2022 |
|
|
40,000 |
|
|
|
27,960,000 |
|
|
$ |
3.00 |
|
| Natural Gas: Open Swap Contracts, Bought, Priced off Henry Hub (NYMEX) |
|
| Period |
|
Notional Quantity (MMBtu/day) |
|
|
Notional Quantity (MMBtu) |
|
|
Strike Price |
|
| Jan 2021 - Dec 2021 |
|
|
10,000 |
|
|
|
3,650,000 |
|
|
$ |
2.62 |
|
| Jan 2022 |
|
|
20,000 |
|
|
|
620,000 |
|
|
$ |
2.79 |
|
| Feb 2022 |
|
|
30,000 |
|
|
|
840,000 |
|
|
$ |
2.79 |
|
| Mar 2022 - May 2022 |
|
|
10,544 |
|
|
|
970,075 |
|
|
$ |
2.69 |
|
| Natural Gas: Open Collar Contracts, Priced off Henry Hub (NYMEX) |
|
| Period |
|
Notional Quantity (MMBtu/day) |
|
|
Notional Quantity (MMBtu) |
|
|
Put Option Weighted Strike Price (Bought) |
|
|
Call Option Weighted Strike Price (Sold) |
|
| Jan 2021 - Dec 2022 |
|
|
40,000 |
|
|
|
29,200,000 |
|
|
$ |
1.83 |
|
|
$ |
3.00 |
|
| Jan 2021 - Dec 2021 |
|
|
30,000 |
|
|
|
10,950,000 |
|
|
$ |
2.18 |
|
|
$ |
3.00 |
|
| Jan 2022 - Feb 2022 |
|
|
30,000 |
|
|
|
1,770,000 |
|
|
$ |
2.20 |
|
|
$ |
4.50 |
|
| Mar 2022 - May 2022 |
|
|
10,000 |
|
|
|
92,000 |
|
|
$ |
2.25 |
|
|
$ |
3.40 |
|
The following amounts were recorded in the Consolidated Balance Sheets in the categories presented and include the fair value of open contracts and closed contracts, which had not yet settled (in thousands):
| |
|
December 31, |
|
| |
|
2020 |
|
|
2019 |
|
| Prepaid and other assets – current |
|
$ |
2,752 |
|
|
$ |
7,266 |
|
| Other assets – non-current |
|
|
2,762 |
|
|
|
2,653 |
|
| Accrued liabilities |
|
|
13,620 |
|
|
|
1,785 |
|
The amounts recorded on the Consolidated Balance Sheets are on a gross basis. If these were recorded on a net settlement basis, it would not have resulted in any differences in reported amounts.
Changes in the fair value and settlements of our commodity derivative contracts were as follows (in thousands):
| |
|
Year Ended December 31, |
|
| |
|
2020 |
|
|
2019 |
|
|
2018 |
|
| Derivative loss (gain) |
|
$ |
(23,808 |
) |
|
$ |
59,887 |
|
|
$ |
(53,798 |
) |
Cash receipts (payments), net, on commodity derivative contract settlements, which include derivative premium payments, are included within Net cash provided by operating activities on the Consolidated Statements of Cash Flows and were as follows (in thousands):
| |
|
Year Ended December 31, |
|
| |
|
2020 |
|
|
2019 |
|
|
2018 |
|
| Derivative cash receipts (payments), net |
|
$ |
45,196 |
|
|
$ |
13,941 |
|
|
$ |
(28,164 |
) |
|