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We have used, and may use, a variety of commodity-based derivative contracts, including fixed price swaps, basis swaps and collars.
−Removed: At June 30, 2024, we had no open commodity derivative contracts or obligations to enter into commodity derivative contracts.
−Removed: Because we historically have not designated any of our derivative contracts as hedges for accounting purposes, changes in the fair value of our derivative contracts were recognized as gains and losses in current period earnings.
+Added: At September 30, 2024, the Company's open derivative contracts consisted of natural gas and NGL commodity derivative contracts under which we will receive a fixed price for the contract and pay a floating market price to the counterparty over a specified period for a contracted volume.
+Added: These commodity derivative contracts consisted of the following:
+Added: Period Type of Derivative Instrument Index (1)
+Added: Daily Volume (Bbl) Weighted Average Price Per Barrel
+Added: October 2024 - December 2024 Swaps Mont Belvieu OPIS 400 $ 42.76
+Added: October 2024 - December 2024 Swaps NYMEX WTI 900 $ 74.85
+Added: January 2025 - December 2025 Swaps Mont Belvieu OPIS 300 $ 39.69
+Added: January 2025 - December 2025 Swaps NYMEX WTI 500 $ 71.60
+Added: January 2026 - June 2026 Swaps NYMEX WTI 300 $ 68.67
+Added: (1) NGL swaps exclude ethane
+Added: There were no open derivative contracts at September 30, 2023.
+Added: Because we historically have not designated any of our derivative contracts as hedges for accounting purposes, changes in the fair value of our derivative contracts are recognized as gains and losses in current period earnings.
As a result, and when applicable, current period earnings could have been significantly affected by changes in the fair value of our commodity derivative contracts.
Changes in fair value were principally measured based on a comparison of future prices to the contract price at the end of the period.
−Removed: The following table summarizes derivative activity for the three and six-month periods ended June 30, 2024 and 2023 (in thousands):
−Removed: Three Months Ended June 30, Six Months Ended June 30,
+Added: The following table summarizes derivative activity for the three and nine-month periods ended September 30, 2024 and 2023 (in thousands):
+Added: Three Months Ended September 30, Nine Months Ended September 30,
2024 2023 2024 2023
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See “Note 3 — Derivatives” to the accompanying unaudited condensed consolidated financial statements included in this Quarterly Report for additional information regarding our commodity derivatives.
−Removed: As applicable, we were exposed to credit risk related to counterparties to our derivative financial contracts.
−Removed: All of our derivative transactions have been carried out in the over-the-counter market.
+Added: Tabl e of Contents
+Added: As applicable, we are exposed to credit risk related to counterparties to our derivative financial contracts.
+Added: All of our derivative transactions are carried out in the over-the-counter market.
The use of derivative transactions in over-the-counter markets involves the risk that the counterparties may be unable to meet the financial terms of the transactions.
−Removed: The counterparties for all of our derivative transactions have had an “investment grade” credit rating.
−Removed: We have historically monitored the credit ratings of our derivative counterparties and considered our counterparties’ credit default risk ratings in determining the fair value of our derivative contracts.
+Added: The counterparties for all of our current derivative transactions have had and continue to have an “investment grade” credit rating.
+Added: We monitor the credit ratings of our derivative counterparties and considered our counterparties’ credit default risk ratings in determining the fair value of our derivative contracts.
Our derivative contracts have historically been with multiple counterparties to minimize exposure to any individual counterparty, and in addition our counterparties have been large financial institutions.
−Removed: We did not require collateral or other security from counterparties to support derivative instruments.
−Removed: We historically had master netting agreements with our derivative contract counterparties, which allowed us to net our derivative assets and liabilities by commodity type with the same counterparty.
−Removed: As a result of the netting provisions, our maximum amount of loss under derivative transactions due to credit risk was limited to the net amounts due from the counterparties under the commodity derivative contracts.
−Removed: Therefore, we were not required to post additional collateral under our commodity derivative contracts.
+Added: We do not require collateral or other security from counterparties to support derivative instruments.
+Added: We have master netting agreements with our derivative contract counterparties, which allows us to net our derivative assets and liabilities by commodity type with the same counterparty.
+Added: As a result of the netting provisions, our maximum amount of loss under derivative transactions due to credit risk is limited to the net amounts due from the counterparties under the commodity derivative contracts.
+Added: Therefore, we are not required to post additional collateral under our commodity derivative contracts.
We are also exposed to credit risk related to the collection of receivables from our joint interest partners for their proportionate share of expenditures on wells and properties we operate.
2 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.