12 unchanged sentences
Due to our improved liquidity and leverage position as compared to historical levels, the percentage of our expected production that we hedge has decreased.
−Removed: For the years ended December 31, 2022 and 2023, 33% and 1%, respectively, of our production was hedged through fixed price commodity swaps, and as of December 31, 2023, we had no fixed price commodity swap positions.
−Removed: Our financial hedging activities may include commodity fixed price swaps, basis swaps, collars or other similar instruments related to the price risk associated with our production.
+Added: For the years ended December 31, 2023 and 2024, substantially all of our production was unhedged.
+Added: Our financial hedging activities may include commodity derivative instruments that are intended to support natural gas, NGLs and oil prices at targeted levels and to manage our exposure to price risk associated with our production.
+Added: These contracts may include commodity price swaps whereby we will receive a fixed price and pay a variable market price to the contract counterparty, collars that set a floor and ceiling price for the hedged production, basis differential swaps or call or embedded put options, among others.
These contracts are financial instruments and do not require or allow for physical delivery of the hedged commodity.
−Removed: As of December 31, 2023, our commodity derivatives included basis differential swaps, call options and embedded put options at index-based pricing for a portion of our production.
−Removed: See Note 11—Derivative Instruments to our consolidated financial statements for more information.
−Removed: Under the Credit Facility, we are permitted to hedge up to 75% of our projected production for the next 60 months.
−Removed: 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.
+Added: As of December 31, 2024, our commodity derivatives included fixed swaps, collars, call options and embedded put options at index-based pricing for a nominal portion of our production.
+Added: See Note 11—Derivative Instruments to our consolidated financial statements for additional information.
Based on our production and our derivative instruments that settled during the year ended December 31, 2024, our revenues would have decreased by $151 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 December 31, 2024.
2 unchanged sentences
Because we do not designate these derivatives as accounting hedges, they do not receive hedge accounting treatment;
−Removed: therefore, all mark to market gains or losses, as well as cash receipts or payments on settled derivative instruments, are recognized in our statements of operations and comprehensive income (loss).
−Removed: We present total gains or losses on commodity derivatives (for both settled derivatives and derivative positions which remain open) within operating revenues as “Commodity derivative fair value gains (losses).”
+Added: therefore, all mark to market gains or losses, as well as cash receipts or payments on settled derivative instruments, are recognized in our statements of operations and comprehensive income.
+Added: We present total gains or losses on commodity derivatives (for both settled derivatives and derivative positions which remain open) within operating revenues as commodity derivative fair value gains (losses) in the consolidated statements of operations and comprehensive income.
Mark-to-market adjustments of derivative instruments cause earnings volatility but have no cash flow impact relative to changes in market prices until the derivative contracts are settled or monetized prior to settlement.
1 unchanged sentence
Our cash flows are impacted when the associated derivative contracts are settled or monetized by making or receiving payments to or from the counterparty.
−Removed: As of December 31, 2022 and 2023, the estimated fair value of our commodity derivative instruments was a net liability of $431 million, and $37 million, respectively, comprised of current and noncurrent assets and liabilities.
+Added: As of December 31, 2023 and 2024, the estimated fair value of our commodity derivative instruments was a net liability $37 million and $47 million, respectively, comprised of current and noncurrent assets and liabilities.
Counterparty and Customer Credit Risk
2 unchanged sentences
We are subject to credit risk due to the concentration of our receivables from several significant customers for sales of natural gas, NGLs and oil.
−Removed: We generally do not require our customers to post collateral.
+Added: While we do at times require customers to post letters of credit or other credit support in connection with their obligations, we generally do not require our customers to post collateral.
The inability or failure of our significant customers to meet their obligations to us, or their insolvency or liquidation, may adversely affect our financial results.
4 unchanged sentences
The creditworthiness of our counterparties is subject to periodic review.
−Removed: We have commodity hedges in place with three different counterparties, two of which are lenders under the Credit Facility.
−Removed: As of December 31, 2023, we did not have any derivative assets with bank counterparties under our Credit Facility.
+Added: As of December 31, 2024, we have commodity hedges in place with four different counterparties, three of which are lenders under the Unsecured Credit Facility.
+Added: As of December 31, 2024, we did not have any commodity derivative assets with bank counterparties under our Unsecured Credit Facility.
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 December 31, 2024.
We believe that all of the counterparties to our derivative instruments are acceptable credit risks as of December 31, 2024.
−Removed: 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: 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.
As of December 31, 2024, we did not have any past-due receivables from, or payables to, any of the counterparties to our derivative contracts.
4 unchanged sentences
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.