14 unchanged sentences
These contracts are financial instruments and do not require or allow for physical delivery of the hedged commodity.
−Removed: As of September 30, 2021, our commodity derivatives included fixed price swaps and basis differential swaps at index-based pricing.
−Removed: As of September 30, 2021, we had in place natural gas swaps covering portions of our projected production through 2023.
−Removed: Our commodity hedge position as of September 30, 2021 is summarized in Note 11—Derivative Instruments to our unaudited condensed consolidated financial statements included elsewhere in this Quarterly Report on Form 10-Q.
+Added: As of March 31, 2022, our commodity derivatives included fixed price swaps and basis differential swaps at index-based pricing.
+Added: As of March 31, 2022, we had in place natural gas swaps covering portions of our projected production through 2023.
+Added: Our commodity hedge position as of March 31, 2022 is summarized in Note 11—Derivative Instruments to our unaudited condensed consolidated financial statements.
Under the Credit Facility, we are permitted to hedge up to 75% of our projected production for the next 60 months.
We may enter into hedge contracts with a term greater than 60 months, and for no longer than 72 months, for up to 65% of our estimated production.
−Removed: Based on our production and our fixed price swap contracts and embedded put option that settled during the nine months ended September 30, 2021, our revenues would have decreased by approximately $22 million for each $0.10 decrease per MMBtu in natural gas prices and $1.00 decrease per Bbl in oil and NGLs prices, excluding the effects of changes in the fair value of our derivative positions which remain open as of September 30, 2021.
+Added: Based on our production and our fixed price swap contracts and embedded put option that settled during the three months ended March 31, 2022, our revenues would have decreased by approximately $23 million for each $0.10 decrease per MMBtu in natural gas prices and $1.00 decrease per Bbl in oil and NGLs prices, excluding the effects of changes in the fair value of our derivative positions which remain open as of March 31, 2022.
All derivative instruments, other than those that meet the normal purchase and normal sale scope exception or other derivative scope exceptions, are recorded at fair market value in accordance with GAAP and are included in our consolidated balance sheets as assets or liabilities.
5 unchanged sentences
We expect continued volatility in the fair value of our derivative instruments.
−Removed: Our cash flows are only impacted when the associated derivative contracts are settled or monetized by making or receiving payments to or from the counterparty.
−Removed: As of September 30, 2021, the estimated fair value of our commodity derivative instruments was a net liability of $1.7 billion comprised of current and noncurrent assets and liabilities.
−Removed: As of December 31, 2020, the estimated fair value of our commodity derivative instruments was a net asset of $22 million comprised of current and noncurrent assets and liabilities.
+Added: Our cash flows are impacted when the associated derivative contracts are settled or monetized by making or receiving payments to or from the counterparty.
+Added: As of March 31, 2022, the estimated fair value of our commodity derivative instruments was a net liability of $1.5 billion comprised of current and noncurrent assets and liabilities.
+Added: As of December 31, 2021, the estimated fair value of our commodity derivative instruments was a net liability of $727 million comprised of current and noncurrent assets and liabilities.
By removing price volatility from a portion of our expected production through December 2024, we have mitigated, but not eliminated, the potential negative effects of changing prices on our operating cash flows for those periods.
2 unchanged sentences
Our principal exposures to credit risk are through receivables resulting from the following:
−Removed: commodity derivative contracts ($15 million as of September 30, 2021);
−Removed: and the sale of our natural gas, NGLs and oil production ($556 million as of September 30, 2021), which we market to energy companies, end users, and refineries.
+Added: commodity derivative contracts ($11 million as of March 31, 2022);
+Added: and the sale of our natural gas, NGLs and oil production ($638 million as of March 31, 2022), which we market to energy companies, end users and refineries.
By using derivative instruments that are not traded on an exchange to hedge exposures to changes in commodity prices, we expose ourselves to the credit risk of our counterparties.
3 unchanged sentences
The creditworthiness of our counterparties is subject to periodic review.
−Removed: We have commodity hedges in place with 17 different counterparties, 13 of which are lenders under our Prior Credit Facility.
−Removed: As of September 30, 2021 , we did not have any derivative assets by bank counterparties under our Prior Credit Facility.
−Removed: The estimated fair value of our commodity derivative assets has been risk-adjusted using a discount rate based upon the counterparties’ respective published credit default swap rates (if available, or if not available, a discount rate based on the applicable Reuters bond rating) as of September 30, 2021 for each of the European and American banks.
+Added: We have commodity hedges in place with 11 different counterparties, 8 of which are lenders under our Credit Facility.
+Added: As of March 31, 2022 , we did not have any derivative assets by bank counterparties under our Credit Facility.
+Added: The estimated fair value of our commodity derivative assets has been risk-adjusted using a discount rate based upon the counterparties’ respective published credit default swap rates (if available, or if not available, a discount rate based on the applicable Reuters bond rating) as of March 31, 2022 for each of the European and American banks.
We believe that all of these institutions, currently, are acceptable credit risks.
−Removed: Other than as provided by the Prior Credit Facility, we are not required to provide credit support or collateral to any of our counterparties under our derivative contracts, nor are they required to provide credit support to us.
−Removed: As of September 30, 2021, we did not have any past-due receivables from, or payables to, any of the counterparties to our derivative contracts.
+Added: Other than as provided by the Credit Facility, we are not required to provide credit support or collateral to any of our counterparties under our derivative contracts, nor are they required to provide credit support to us.
+Added: As of March 31, 2022, we did not have any past-due receivables from, or payables to, any of the counterparties to our derivative contracts.
We are also subject to credit risk due to the concentration of our receivables from several significant customers for sales of natural gas, NGLs and oil.
2 unchanged sentences
Interest Rate Risks
−Removed: Our primary exposure to interest rate risk results from outstanding borrowings under the Prior Credit Facility, which has a floating interest rate.
−Removed: The average annualized interest rate incurred on the Prior Credit Facility during the nine months ended September 30, 2021 was approximately 4.18%.
−Removed: We estimate that a 1.0% increase in the applicable average interest rates for the nine months ended September 30, 2021 would have resulted in an estimated $1.5 million increase in interest expense.
+Added: Our primary exposure to interest rate risk results from outstanding borrowings under the Credit Facility, which has a floating interest rate.
+Added: The average annualized interest rate incurred on the Credit Facility for borrowings during the three months ended March 31, 2022 was approximately 3.19%.
+Added: We estimate that a 1.0% increase in the applicable average interest rates for the three months ended March 31, 2022 would have resulted in an estimated $0.4 million increase in interest expense.
Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.