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Disclosure of Compensation Related Costs, Share-based Payments [Abstract]

1. Interest expense

The following amounts have been incurred and charged to interest expense for the periods presented:



	Three months ended September 30,						Nine months ended September 30,
(in thousands)	2013			2012			2013			2012
Cash payments for interest	$	26,627		$	26,915		$	75,187		$	55,376
Change in net present value of deferred premiums for derivative financial instruments	102			176			384			495
Amortization of deferred loan costs and other adjustments	2,634			1,127			4,976			3,129
Change in accrued interest	(4,391		)	(3,733		)	(4,071		)	2,348
Interest costs incurred	24,972			24,485			76,476			61,348
Less capitalized interest	(43		)	(62		)	(255		)	(567		)
Total interest expense	$	24,929		$	24,423		$	76,221		$	60,781

2. 2022 Notes

On April 27, 2012, Laredo completed an offering of $500.0 million in aggregate principal amount of 7 3/8% senior unsecured notes due 2022 (the “2022 Notes”). The 2022 Notes will mature on May 1, 2022 and bear an interest rate of 7 3/8% per annum, payable semi-annually, in cash in arrears on May 1 and November 1 of each year, commencing November 1, 2012. The 2022 Notes are fully and unconditionally guaranteed, jointly and severally on a senior unsecured basis by Laredo Holdings and its subsidiaries, with the exception of Laredo (collectively, the “Guarantors”).

3. 2019 Notes

On January 20, 2011, Laredo completed an offering of $350.0 million 9 1/2% senior unsecured notes due 2019 (the “January Notes”) and on October 19, 2011, Laredo completed an offering of an additional $200.0 million 9 1/2% senior unsecured notes due 2019 (the “October 2011 Notes” and together with the January Notes, the “2019 Notes”). The 2019 Notes will mature on February 15, 2019 and bear an interest rate of 9 1/2% per annum, payable semi-annually, in cash in arrears on February 15 and August 15 of each year. The 2019 Notes are fully and unconditionally guaranteed, jointly and severally on a senior unsecured basis by the Guarantors.

4. Senior secured credit facility

As of September 30, 2013, Laredo’s Third Amended and Restated Credit Agreement (as amended, the “Senior Secured Credit Facility”) had a maturity date of July 1, 2016 and a borrowing base of $825.0 million with no amounts outstanding. It contains both financial and non-financial covenants, all of which the Company was in compliance with as of September 30, 2013. Additionally, the Senior Secured Credit Facility provides for the issuance of letters of credit, limited to the lesser of total capacity or $20.0 million.

Subsequent to September 30, 2013, the Company entered into an amendment to the Senior Secured Credit Facility. See Note N.1 for additional information.

5. Fair value of debt

The Company has not elected to account for its debt instruments at fair value. The following table presents the carrying amount and fair value of the Company’s debt instruments for the periods presented:



	September 30, 2013				December 31, 2012
(in thousands)	Carrying value		Fair value		Carrying value		Fair value
2019 Notes⁽¹⁾	$	551,595	$	614,625	$	551,760	$	616,000
2022 Notes	500,000		532,500		500,000		541,250
Senior Secured Credit Facility	—		—		165,000		165,098
Total value of debt	$	1,051,595	$	1,147,125	$	1,216,760	$	1,322,348

______________________________________________________________________________


(1)	The carrying value of the 2019 Notes includes the October 2011 Notes unamortized bond premium of approximately $1.6 million and $1.8 million as of September 30, 2013 and December 31, 2012, respectively.

As of September 30, 2013 and December 31, 2012, the fair value of the debt outstanding on the 2019 Notes and the 2022 Notes was determined using the September 30, 2013 and December 31, 2012 quoted market price (Level 1), respectively, and the fair value of the outstanding debt as of September 30, 2013 and December 31, 2012 on the Senior Secured Credit Facility was estimated utilizing pricing models for similar instruments (Level 2). See Note G for information about fair value hierarchy levels.

Employee compensation

9 Months Ended

Sep. 30, 2013

Compensation and Employee Benefit Plans [Text Block]

D—Employee compensation

In connection with the IPO, the Board of Directors of Laredo Holdings and its stockholders approved a Long-Term Incentive Plan (the “LTIP”), which provides for the granting of incentive awards in the form of restricted stock awards, stock options and other awards. The LTIP provides for the issuance of 10.0 million shares.

The Company recognizes the fair value of stock-based payments to employees and directors as a charge against earnings. The Company recognizes stock-based compensation expense over the requisite service period. Stock-based compensation is included in “General and administrative” in the unaudited consolidated statements of operations.

1. Restricted stock awards

All restricted stock awards are treated as issued and outstanding in the accompanying unaudited consolidated financial statements. If an employee terminates employment prior to the restriction lapse date, the awarded shares are forfeited and canceled and are no longer considered issued and outstanding. Restricted stock awards converted in the Corporate Reorganization vested 20% at the grant date and then vest 20% annually thereafter. The restricted stock awards granted under the LTIP to management and employees generally vest 33%, 33% and 34% per year beginning on the first anniversary date of the grant. Restricted stock awards granted to non-employee directors vest fully on the anniversary date of the grant.

The following table reflects the outstanding restricted stock awards for the nine months ended September 30, 2013:



(in thousands, except for weighted average grant date fair values)	Restricted stock awards		Weighted average grant date fair value
Outstanding at December 31, 2012	1,195		$	15.06
Granted	1,445		$	17.95
Forfeited	(192	)	$	18.60
Vested⁽¹⁾	(507	)	$	18.80
Outstanding at September 30, 2013	1,941		$	18.94

______________________________________________________________________________

(1) The vesting of certain restricted stock grants could result in federal and state income tax expense or benefits related to the difference between the market price of the common stock at the date of vesting and the date of grant. The Company recognized income tax expense of $0.4 million during the nine months ended September 30, 2013 related to restricted stock, which were recorded as adjustments to deferred income taxes. There were no comparative amounts recorded in the three months ended September 30, 2013 or the three or nine months ended September 30, 2012.

2. Restricted stock option awards

Restricted stock options granted under the LTIP vest and are exercisable in four equal installments on each of the first four anniversaries of the date of the grant. The following table reflects the stock option award activity for the nine months ended September 30, 2013:



(in thousands, except for weighted average exercise price and contractual term)	Restricted stock option awards		Weighted average exercise price (per option)		Weighted average remaining contractual term (years)
Outstanding at December 31, 2012	459		$	24.11	9.1
Granted	1,019		$	17.46	9.4
Exercised⁽¹⁾	(34	)	$	22.83	9.0
Expired or canceled	(12	)	$	24.11	8.3
Forfeited	(112	)	$	19.96	—
Outstanding at September 30, 2013	1,320		$	19.35	9.1
Vested and exercisable at end of period	107		$	24.11	8.3

_____________________________________________________________________________

(1) The exercise of stock options could result in federal and state income tax expense or benefits related to the difference between the fair value of the stock option at the date of grant and the intrinsic value of the stock option when exercised. The Company recognized income tax expense of $0.1 million during each of the the three and nine months ended September 30, 2013, respectively, related to stock options, which were recorded as adjustments to deferred income taxes. There were no comparative amounts recorded in the three or nine months ended September 30, 2012.

The Company utilized the Black-Scholes option pricing model to determine the fair value of restricted stock options and is recognizing the associated expense on a straight-line basis over the four-year requisite service period of the awards. Determining the fair value of equity-based awards requires judgment, including estimating the expected term that stock options will be outstanding prior to exercise and the associated volatility.

The assumptions used to estimate the fair value of restricted stock options granted on February 15, 2013 are as follows:



Risk-free interest rate⁽¹⁾	1.19		%
Expected option life⁽²⁾	6.3 years
Expected volatility⁽³⁾	58.89		%
Fair value per option	$	9.67

______________________________________________________________________________


(1)	U.S. Treasury yields as of the grant date were utilized for the risk-free interest rate assumption, matching the treasury yield terms to the expected life of the option.


(2)	As the Company had no exercise history at the time of valuation, expected option life assumptions were developed using the simplified method in accordance with GAAP.


(3)	The Company utilized a peer historical look-back, which was weighted with the Company’s own volatility since the IPO, in order to develop the expected volatility.

3. Performance unit awards

The performance unit awards issued to management are subject to a combination of market and service vesting criteria. A Monte Carlo simulation prepared by an independent third party is utilized in order to determine the fair value of these awards at the date of grant and to re-measure the fair value at the end of each reporting period until settlement. Due to the relatively short trading history of the Company’s stock, the volatility criteria utilized in the Monte Carlo simulation is based on the volatilities of a group of peer companies that have been determined to be most representative of the Company’s expected volatility. These awards are accounted for as liability awards as they will be settled in cash at the end of the requisite service period based on the achievement of certain performance criteria. The liability and related compensation expense for each period for these awards is recognized by dividing the fair value of the total liability by the requisite service period and recording the pro rata share for the period for which service has already been provided. As there are inherent uncertainties related to these factors and the Company’s judgment in applying them to the fair value determinations, there is risk that the recorded performance unit compensation may not accurately reflect the amount ultimately earned by the members of management.

Compensation expense for these awards amounted to $2.8 million and $0.5 million in the three months ended September 30, 2013 and 2012, respectively, and $5.0 million and $1.5 million in the nine months ended September 30, 2013 and 2012, respectively, and is recognized in “General and administrative” in the Company’s unaudited consolidated statements of operations, and the corresponding liability is included in “Other noncurrent liabilities” in the September 30, 2013 and December 31, 2012 unaudited consolidated balance sheets.

4. Defined contribution plan

The Company sponsors a 401(k) defined contribution plan for the benefit of substantially all employees at the date of hire. The plan allows eligible employees to make pre-tax and after-tax contributions up to 100% of their annual compensation, not to exceed annual limits established by the federal government. The Company makes matching contributions of up to 6% of an employee’s compensation and may make additional discretionary contributions for eligible employees. Employees are 100% vested in the employer contributions upon receipt.

The following table presents total employer contributions to the plans for the periods presented:



	Three months ended September 30,				Nine months ended September 30,
(in thousands)	2013		2012		2013		2012
Contributions	$	501	$	321	$	1,382	$	963

Income taxes

9 Months Ended

Sep. 30, 2013

Income Tax Disclosure [Abstract]

Income taxes

E—Income taxes

The Company uses an asset and liability approach for financial accounting and for reporting income tax. Deferred income taxes reflect the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes.

The Company is subject to corporate income taxes and the Texas franchise tax. Income tax (expense) benefit attributable to income from continuing operations for the periods presented consisted of the following:



	Three months ended September 30,					Nine months ended September 30,
(in thousands)	2013			2012		2013			2012
Current taxes:
Federal	$	—		$	—	$	—		$	—
State	—			—		—			—
Deferred taxes:
Federal	(6,032		)	3,987		(26,322		)	(26,832		)
State	(4,016		)	103		(4,883		)	(1,231		)
Income tax (expense) benefit	$	(10,048	)	$	4,090	$	(31,205	)	$	(28,063	)

The following presents the comprehensive provision for income taxes for the periods presented:



	Three months ended September 30,					Nine months ended September 30,
(in thousands)	2013			2012		2013			2012
Comprehensive provision for income taxes allocable to:
Continuing operations	$	(10,048	)	$	4,090	$	(31,205	)	$	(28,063	)
Discontinued operations	(321		)	64		(765		)	36
Comprehensive provision for income taxes	$	(10,369	)	$	4,154	$	(31,970	)	$	(28,027	)

Income tax (expense) benefit attributable to income from continuing operations before income taxes differed from amounts computed by applying the applicable federal income tax rate of 34% to pre-tax earnings as a result of the following:



	Three months ended September 30,						Nine months ended September 30,
(in thousands)	2013			2012			2013			2012
Income tax (expense) benefit computed by applying the statutory rate	$	(7,434	)	$	3,862		$	(27,014	)	$	(26,504	)
State income tax, net of federal tax benefit and increase in valuation allowance	(2,651		)	1,380			(3,223		)	(517		)
Non-deductible stock-based compensation	(156		)	(341		)	(495		)	(996		)
Stock-based compensation tax deficiency	(72		)	—			(483		)	—
Change in deferred tax valuation allowance	(20		)	(20		)	(49		)	(22		)
Other items	285			(791		)	59			(24		)
Income tax (expense) benefit	$	(10,048	)	$	4,090		$	(31,205	)	$	(28,063	)

Significant components of the Company’s deferred tax assets for the periods presented are as follows:



(in thousands)	September 30, 2013			December 31, 2012
Derivative financial instruments	$	(2,284	)	$	7,108
Oil and natural gas properties and equipment	(247,745		)	(175,823		)
Net operating loss carry-forward	268,940			222,017
Accrued bonus	1,959			3,502
Stock-based compensation	6,095			2,928
Capitalized interest	2,104			1,850
Other	1,707			1,113
Gross deferred tax asset	30,776			62,695
Valuation allowance	(117		)	(66		)
Net deferred tax asset	$	30,659		$	62,629

Net deferred tax assets and liabilities were classified in the unaudited consolidated balance sheets as follows for the periods presented:



(in thousands)	September 30, 2013		December 31, 2012
Deferred tax asset	$	30,659	$	62,629
Deferred tax liability	—		—
Net deferred tax assets	$	30,659	$	62,629

The Company had federal net operating loss carry-forwards totaling approximately $771.3 million and state of Oklahoma net operating loss carry-forwards totaling approximately $179.6 million as of September 30, 2013. These carry-forwards begin expiring in 2026. As of September 30, 2013, the Company believes the federal and state of Oklahoma net operating loss carry-forwards are fully realizable. The Company considered all available evidence, both positive and negative in determining whether, based on the weight of that evidence, a valuation allowance was needed on either the federal or Oklahoma net operating loss carry-forwards. Such consideration included estimated future projected earnings based on existing reserves and projected future cash flows from its oil and natural gas reserves (including the timing of those cash flows), the reversal of deferred tax liabilities recorded as of September 30, 2013, the Company’s ability to capitalize intangible drilling costs, rather than expensing these costs in order to prevent an operating loss carry-forward from expiring unused, and future projections of Oklahoma sourced income.

The Company maintains a valuation allowance to reduce certain deferred tax assets to amounts that are more likely than not to be realized. As of September 30, 2013, a full valuation allowance of $0.1 million was recorded against the deferred tax asset related to the Company’s charitable contribution carry-forward of $0.3 million.

In evaluating its current tax positions in order to identify any material uncertain tax positions, the Company developed a policy for identifying uncertain tax positions that considers support for each position, industry standard, tax return disclosure and schedule, and the significance of each position. The Company had no material adjustments to its unrecognized tax benefits during the three or nine months ended September 30, 2013.

The Company and its subsidiaries file a federal corporate income tax return on a consolidated basis. The Company's income tax returns for the years 2009 through 2012 remain open and subject to examination by federal tax authorities and/or the tax authorities in Oklahoma, Texas and Louisiana which are the jurisdictions where the Company has or has had operations. Additionally, the statute of limitations for examination of federal net operating loss carry-overs typically does not begin to run until the year the attribute is utilized in a tax return.

The effective tax rate for the Company's continuing operations for the nine months ended September 30, 2013 was 39% as compared to 36% for the corresponding period ended September 30, 2012. GAAP requires the application of the estimated annual effective rate in determining the interim period tax provision unless a rate cannot be reliably estimated, such as when a small change in pre-tax income or loss creates significant variations in the customary relationship between income tax expense or benefit and pre-tax income or loss in interim periods. In such a situation, the interim period tax provision should be based on actual year-to-date results. The estimated annual effective rate used to record the Company's tax provisions, before considering discrete items, for each of the nine months ended September 30, 2013 and 2012 was 36%.

The impact of significant discrete items is separately recognized in the quarter in which they occur. During the nine months ended September 30, 2013, certain shares related to restricted stock awards vested at times when the Company's stock price was lower than the fair value of those shares at the time of grant. As a result, the income tax deduction related to such shares is less than the expense previously recognized for book purposes. During the nine months ended September 30, 2013, certain restricted stock options were exercised. The income tax deduction related to the options intrinsic value was less than the expense previously recognized for book purposes. In accordance with GAAP, such shortfalls reduce additional paid-in capital to the extent windfall tax benefits have been previously recognized. However, the Company has not previously recognized any windfall tax benefits. Therefore, the tax impact of these shortfalls totaling $0.1 million and $0.5 million for the three and nine months ended September 30, 2013, respectively, is included in income tax expense attributable to continuing operations for these periods. There were no comparative amounts for the three or nine months ended September 30, 2012.

The Company filed its 2012 federal and Oklahoma income tax returns during the three months ended September 30, 2013. As a result the Company recognized an aggregate expense from tax related items, primarily the result of Oklahoma income allocation updates. The expense related to the Oklahoma income allocation updates reflects a change to the applicable methodology for allocating income between certain states in the in the fiscal 2012 and prior year returns. The tax impact of these items of $2.4 million for each of the three and nine month periods ending September 30, 2013, respectively, is included in income tax expense attributable to continuing operations for these respective periods. There were no comparative amounts for the three or nine month periods ended September 30, 2012.

Derivative financial instruments

9 Months Ended

Sep. 30, 2013

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Derivative financial instruments

F—Derivative financial instruments

1. Commodity derivatives

The Company engages in derivative transactions such as collars, swaps, puts and basis swaps to hedge price risks due to unfavorable changes in oil and natural gas prices related to its oil and natural gas production. As of September 30, 2013, the Company had 45 open derivative contracts with financial institutions which extend from October 2013 to June 2018 none of which were designated as hedges for accounting purposes. The contracts are recorded at fair value on the balance sheet and gains and losses are recognized in current period earnings.

Each collar transaction has an established price floor and ceiling. When the settlement price is below the price floor established by these collars, the Company receives an amount from its counterparty equal to the difference between the settlement price and the price floor multiplied by the hedged contract volume. When the settlement price is above the price ceiling established by these collars, the Company pays its counterparty an amount equal to the difference between the settlement price and the price ceiling multiplied by the hedged contract volume.

Each swap transaction has an established fixed price. When the settlement price is above the fixed price, the Company pays its counterparty an amount equal to the difference between the settlement price and the fixed price multiplied by the hedged contract volume. When the settlement price is below the fixed price, the counterparty pays the Company an amount equal to the difference between the settlement price and the fixed price multiplied by the hedged contract volume.

Each put transaction has an established floor price. The Company pays the counterparty a premium in order to enter into the put transaction. When the settlement price is below the floor price, the counterparty pays the Company an amount equal to the difference between the settlement price and the fixed price multiplied by the hedged contract volume. When the settlement price is above the floor price, the put option expires.

The Company's natural gas basis swap transaction has an established fixed basis differential between the New York Mercantile Exchange ("NYMEX") natural gas futures and West Texas WAHA ("WAHA") index natural gas price. When the NYMEX futures settlement price less the fixed basis differential is greater than the actual WAHA price, the difference multiplied by the hedged contract volume is paid to the Company by the counterparty. When the difference between the NYMEX futures settlement price less the fixed basis differential is less than the actual WAHA price, the Company pays the counterparty an amount equal to the difference multiplied by the hedged contract volume.

Each oil basis swap transaction has an established fixed basis differential. The Company's oil basis swap differentials are between the West Texas Intermediate Midland Argus ("Midland") index crude oil price and the West Texas Intermediate Argus ("WTI Argus") index crude oil price or the Brent International Petroleum Exchange ("Brent") index crude oil price and the Light Louisiana Sweet Argus ("LLS Argus") index crude oil price. When the WTI Argus price less the fixed basis differential is greater than the actual Midland price, the difference multiplied by the hedged contract volume is paid to the Company by the counterparty. When the WTI Argus price less the fixed basis differential is less than the actual Midland price, the difference multiplied by the hedged contract volume is paid by the Company to the counterparty. When the Brent price less the fixed basis differential is greater than the actual LLS Argus price, the difference multiplied by the hedged contract volume is paid to the Company by the counterparty. When the LLS Argus price less the fixed basis differential is less than the actual Brent price, the difference multiplied by the hedged contract volume is paid by the Company to the counterparty.

Gains and losses on derivative financial instruments are reported on the unaudited consolidated statements of operations in the respective “Total gain (loss) on derivative financial instruments” amounts.

During the nine months ended September 30, 2013, the Company entered into additional commodity contracts to hedge a portion of its estimated future production. The following table summarizes information about these additional commodity derivative contracts:



	Aggregate volumes	Swap price		Floor price		Ceiling price		Contract period
Oil (volumes in Bbl):
Swap	1,377,000	$	98.10	$	—	$	—	March 2013 - December 2013
Basis swap	4,026,000	$	1.00	$	—	$	—	March 2013 - December 2014
Swap	80,000	$	101.20	$	—	$	—	August 2013 - December 2013
Swap	204,000	$	106.60	$	—	$	—	October 2013 - December 2013
Swap	912,500	$	93.65	$	—	$	—	January 2014 - December 2014
Swap	365,000	$	93.68	$	—	$	—	January 2014 - December 2014
Swap	399,996	$	93.30	$	—	$	—	January 2014 - December 2014
Swap	480,000	$	97.47	$	—	$	—	January 2014 - December 2014
Basis swap⁽¹⁾	14,610,000	$	2.85	$	—	$	—	July 2014 - June 2018
Price collar	1,277,500	$	—	$	80.00	$	98.50	January 2015 - December 2015
Price collar	690,000	$	—	$	80.00	$	95.87	January 2015 - December 2015
Price collar	1,281,000	$	—	$	80.00	$	93.00	January 2016 - December 2016
Price collar	579,000	$	—	$	80.00	$	87.75	January 2016 - December 2016
Natural gas (volumes in MMBtu):
Price collar	2,900,000	$	—	$	3.00	$	4.00	March 2013 - December 2013
Swap	3,338,400	$	4.31	$	—	$	—	June 2013 - December 2013
Swap	3,978,500	$	4.36	$	—	$	—	January 2014 - December 2014

______________________________________________________________________________

(1) This oil basis swap differential is between the Brent index crude oil price and the LLS Argus index crude oil price.

The following commodity derivative contracts were transferred to a buyer in connection with the Anadarko Basin Sale:



	Aggregate volumes	Swap price		Contract period
Natural gas (volumes in MMBtu):
Swap	2,386,800	$	4.31	August 2013 - December 2013
Swap	3,978,500	$	4.36	January 2014 - December 2014

During the three and nine months ended September 30, 2013, the Company received approximately $5.4 million, net of $2.2 million in deferred premiums, in settlements from early terminations of commodity derivative financial instrument contracts. There were no comparable amounts recorded in the three or nine months ended September 30, 2012. Gains and losses on early terminated derivative financial instruments are reported on the unaudited consolidated statements of operations in the respective “Total gain (loss) on derivative financial instruments” amounts.

The following commodity derivative contracts were unwound in connection with the Anadarko Basin Sale during the three months ended September 30, 2013:



	Aggregate volumes	Floor price		Ceiling price		Contract period
Natural gas (volumes in MMBtu):
Price collar	2,200,000	$	4.00	$	7.05	September 2013 - December 2013
Put	2,200,000	$	4.00	$	—	September 2013 - December 2013
Price collar	3,480,000	$	4.00	$	7.00	January 2014 - December 2014
Price collar	1,800,000	$	4.00	$	7.05	January 2014 - December 2014
Price collar	1,680,000	$	4.00	$	7.05	January 2014 - December 2014
Price collar	1,560,000	$	3.00	$	5.50	January 2014 - December 2014
Price collar	2,520,000	$	3.00	$	6.00	January 2015 - December 2015
Price collar	2,400,000	$	3.00	$	6.00	January 2015 - December 2015
Price collar	2,400,000	$	3.00	$	6.00	January 2015 - December 2015

The following table summarizes open positions as of September 30, 2013, and represents, as of such date, derivatives in place through June 2018, on annual production volumes:



	Remaining Year 2013		Year 2014		Year 2015		Year 2016		Year 2017		Year 2018
Oil Positions:
Puts:
Hedged volume (Bbl)	270,000		540,000		456,000		—		—		—
Weighted average price ($/Bbl)	$	65.00	$	75.00	$	75.00	$	—	$	—	$	—
Swaps:
Hedged volume (Bbl)	816,000		2,157,496		—		—		—		—
Weighted average price ($/Bbl)	$	100.08	$	94.44	$	—	$	—	$	—	$	—
Collars:
Hedged volume (Bbl)	192,000		726,000		2,219,500		1,860,000		—		—
Weighted average floor price ($/Bbl)	$	79.38	$	75.45	$	79.43	$	80.00	$	—	$	—
Weighted average ceiling price ($/Bbl)	$	121.67	$	129.09	$	101.83	$	91.37	$	—	$	—
Basis swaps:
Hedged volume⁽¹⁾ (Bbl)	736,000		2,252,000		—		—		—		—
Weighted average price⁽¹⁾ ($/Bbl)	$	1.40	$	1.04	$	—	$	—	$	—	$	—
Hedged volume⁽²⁾ (Bbl)	—		1,840,000		3,650,000		3,660,000		3,650,000		1,810,000
Weighted average price⁽²⁾ ($/Bbl)	$	—	$	2.85	$	2.85	$	2.85	$	2.85	$	2.85
Natural Gas Positions:
Puts:
Hedged volume (MMBtu)	—		—		—		—		—		—
Weighted average price ($/MMBtu)	$	—	$	—	$	—	$	—	$	—	$	—
Swaps:
Hedged volume (MMBtu)	—		—		—		—		—		—
Weighted average price ($/MMBtu)	$	—	$	—	$	—	$	—	$	—	$	—
Collars:
Hedged volume (MMBtu)	3,160,000		9,600,000		8,160,000		—		—		—
Weighted average floor price ($/MMBtu)	$	3.01	$	3.00	$	3.00	$	—	$	—	$	—
Weighted average ceiling price ($/MMBtu)	$	4.69	$	5.50	$	6.00	$	—	$	—	$	—
Basis swaps:⁽³⁾
Hedged volume (MMBtu)	300,000		—		—		—		—		—
Weighted average price ($/MMBtu)	$	0.33	$	—	$	—	$	—	$	—	$	—

_______________________________________________________________________________


(1)	The associated oil basis swap derivatives are settled based on the differential between the Midland oil futures and the WTI Argus index oil price.


(2)	The associated oil basis swap derivatives are settled based on the differential between the Brent oil price and the LLS Argus index gas price.


(3)	The cash settlement price of the Company's natural gas basis swaps is calculated on the difference between the Company's natural gas futures contracts that settle on the NYMEX index and the NYMEX index price at the time of settlement. At September 30, 2013, the Company had 80,000 MMBtu for 2013 in basis swaps that did not have corresponding volumes hedged with a NYMEX index price.

The following represents cash settlements on matured derivative financial instruments for the periods presented:



	Three months ended September 30,						Nine months ended September 30,
(in thousands)	2013			2012			2013			2012
Commodity derivatives (paid) received	$	(3,975	)	$	7,078		$	888		$	20,901
Interest rate derivatives paid	(94		)	(84		)	(300		)	(2,022		)
Cash settlements on matured derivative financial instruments (paid) received	$	(4,069	)	$	6,994		$	588		$	18,879

2. Interest rate derivatives

The Company is exposed to market risk for changes in interest rates related to its Senior Secured Credit Facility. Interest rate derivative agreements are used to manage a portion of the exposure related to changing interest rates by converting floating-rate debt to fixed-rate debt. If the London Interbank Offered Rate ("LIBOR") is lower than the fixed rate in the contract, the Company is required to pay the counterparties the difference, and conversely, the counterparties are required to pay the Company if LIBOR is higher than the fixed rate in the contract. The Company did not designate the interest rate derivatives as cash flow hedges; therefore, the changes in fair value of these instruments are recorded in current earnings. No interest rate derivative financial instruments were in place as of September 30, 2013.

3. Balance sheet presentation

The Company’s oil and natural gas commodity derivatives and interest rate derivatives are presented on a net basis in “Derivative financial instruments” in the unaudited consolidated balance sheets.

The following summarizes the fair value of derivatives outstanding on a gross basis as of:



(in thousands)	September 30, 2013		December 31, 2012
Assets:
Commodity derivatives:
Oil derivatives	$	41,142	$	16,219
Natural gas derivatives	1,343		17,896
Total assets	$	42,485	$	34,115

Liabilities:
Commodity derivatives:
Oil derivatives⁽¹⁾	$	38,872	$	21,308
Natural gas derivatives⁽²⁾	2,646		10,413
Interest rate derivatives	—		277
Total liabilities	$	41,518	$	31,998

Net derivative position	$	967	$	2,117

______________________________________________________________________________

(1) The oil derivatives fair value includes a deferred premium liability of $13.0 million and $18.3 million as of September 30, 2013 and December 31, 2012, respectively.

(2) The natural gas derivatives fair value includes a deferred premium liability of $1.9 million and $6.4 million as of September 30, 2013 and December 31, 2012, respectively.

By using derivative instruments to hedge exposures to changes in commodity prices and interest rates, the Company exposes itself to credit risk and market risk. Market risk is the exposure to changes in the market price of oil and natural gas, which are subject to fluctuations from a variety of factors, including changes in supply and demand. Credit risk is the failure of the counterparty to perform under the terms of the derivative contract. When the fair value of a derivative contract is positive, the counterparty owes the Company, which creates credit risk. The Company’s counterparties are participants in the Senior Secured Credit Facility which is secured by the Company’s oil and natural gas reserves; therefore, the Company is not required to post any collateral. The Company does not require collateral from its counterparties. The Company minimizes the credit risk in derivative instruments by: (i) limiting its exposure to any single counterparty; (ii) entering into derivative instruments only with counterparties that are also lenders in the Senior Secured Credit Facility and meet the Company’s minimum credit quality standard, or have a guarantee from an affiliate that meets the Company’s minimum credit quality standard; and (iii) monitoring the creditworthiness of the Company’s counterparties on an ongoing basis. In accordance with the Company’s standard practice, its commodity and interest rate derivatives are subject to counterparty netting under agreements governing such derivatives and, therefore, the risk of such loss is somewhat mitigated as of September 30, 2013.

The entire disclosure for derivative instruments and hedging activities including, but not limited to, risk management strategies, non-hedging derivative instruments, assets, liabilities, revenue and expenses, and methodologies and assumptions used in determining the amounts.

+ References

Reference 1: http://www.xbrl.org/2003/role/presentationRef
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-Name Accounting Standards Codification
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Reference 3: http://www.xbrl.org/2003/role/presentationRef
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+ Details

Fair value measurements

9 Months Ended

Sep. 30, 2013

Fair Value Disclosures [Abstract]

Fair value measurements

G—Fair value measurements

The Company accounts for its oil and natural gas commodity and interest rate derivatives at fair value. The fair value of derivative financial instruments is determined utilizing pricing models for similar instruments. The models use a variety of techniques to arrive at fair value, including quotes and pricing analysis. Inputs to the pricing models include publicly available prices and forward curves generated from a compilation of data gathered from third parties.

The Company has categorized its assets and liabilities measured at fair value, based on the priority of inputs to the valuation technique, into a three-level fair value hierarchy. The fair value hierarchy gives the highest priority to quoted prices in active markets for identical assets or liabilities (Level 1) and the lowest priority to unobservable inputs (Level 3).

Assets and liabilities recorded at fair value on the unaudited consolidated balance sheets are categorized based on inputs to the valuation techniques as follows:



Level 1—	Assets and liabilities recorded at fair value for which values are based on unadjusted quoted prices for identical assets or liabilities in an active market that management has the ability to access. Active markets are considered to be those in which transactions for the assets or liabilities occur in sufficient frequency and volume to provide pricing information on an ongoing basis.

Level 2—	Assets and liabilities recorded at fair value for which values are based on quoted prices in markets that are not active or model inputs that are observable either directly or indirectly for substantially the full term of the assets or liabilities. Substantially all of these inputs are observable in the marketplace throughout the full term of the price risk management instrument and can be derived from observable data or supported by observable levels at which transactions are executed in the marketplace.

Level 3—	Assets and liabilities recorded at fair value for which values are based on prices or valuation techniques that require inputs that are both unobservable and significant to the overall fair value measurement. Unobservable inputs are not corroborated by market data. These inputs reflect management’s own assumptions about the assumptions a market participant would use in pricing the asset or liability.

When the inputs used to measure fair value fall within different levels of the hierarchy in a liquid environment, the level within which the fair value measurement is categorized is based on the lowest level input that is significant to the fair value measurement in its entirety. The Company conducts a review of fair value hierarchy classifications on an annual basis. Changes in the observability of valuation inputs may result in a reclassification for certain financial assets or liabilities. Transfers between fair value hierarchy levels are recognized and reported in the period in which the transfer occurred. No transfers between fair value hierarchy levels occurred during the three and nine months ended September 30, 2013 or 2012.

1. Fair value measurement on a recurring basis

The following presents the Company’s fair value hierarchy for assets and liabilities measured at fair value on a recurring basis for the periods presented:



(in thousands)	Level 1		Level 2		Level 3			Total fair value
As of September 30, 2013:
Commodity derivatives	$	—	$	15,930	$	—		$	15,930
Deferred premiums	—		—		(14,963		)	(14,963		)
Interest rate derivatives	—		—		—			—
Total	$	—	$	15,930	$	(14,963	)	$	967



(in thousands)	Level 1		Level 2			Level 3			Total fair value
As of December 31, 2012:
Commodity derivatives	$	—	$	27,103		$	—		$	27,103
Deferred premiums	—		—			(24,709		)	(24,709		)
Interest rate derivatives	—		(277		)	—			(277		)
Total	$	—	$	26,826		$	(24,709	)	$	2,117

These items are included in “Derivative financial instruments” on the unaudited consolidated balance sheets. Significant Level 2 assumptions associated with the calculation of discounted cash flows used in the “mark-to-market” analysis of commodity derivatives include the NYMEX natural gas and crude oil prices, appropriate risk adjusted discount rates and other relevant data. Significant Level 2 assumptions associated with the calculation of discounted cash flows used in the “mark-to-market” analysis of interest rate swaps include the interest rate curves, appropriate risk adjusted discount rates and other relevant data.

The Company’s deferred premiums associated with its commodity derivative contracts are categorized as Level 3, as the Company utilizes a net present value calculation to determine the valuation. They are considered to be measured on a recurring basis as the derivative contracts they derive from are measured on a recurring basis. As commodity derivative contracts containing deferred premiums are entered into, the Company discounts the associated deferred premium to its net present value at the contract trade date, using the Senior Secured Credit Facility rate at the trade date (historical input rates range from 2.00% to 3.56%), and then records the change in net present value to interest expense over the period from trade until the final settlement date at the end of the contract. After this initial valuation, the net present value of each deferred premium is not adjusted; therefore, significant increases (decreases) in the Senior Secured Credit Facility rate would result in a significantly lower (higher) fair value measurement for each new deal containing a deferred premium entered into; however, the valuation for the deferred premiums already recorded would remain unaffected. While the Company believes the sources utilized to arrive at the fair value estimates are reliable, different sources or methods could have yielded different fair value estimates; therefore, on a quarterly basis, the valuation is compared to counterparty valuations and third-party valuation of the deferred premiums for reasonableness.

The following table presents actual cash payments required for deferred premium contracts in place as of September 30, 2013, and for the calendar years following:



(in thousands)
Remaining 2013	$	2,357
2014	7,419
2015	5,166
2016	358
Total	$	15,300

A summary of the changes in assets classified as Level 3 measurements for the periods presented are as follows:



	Three months ended September 30,						Nine months ended September 30,
(in thousands)	2013			2012			2013			2012
Balance of Level 3 at beginning of period	$	(19,742	)	$	(23,552	)	$	(24,709	)	$	(18,868	)
Change in net present value of deferred premiums for derivative financial instruments	(102		)	(176		)	(384		)	(495		)
Total purchases and settlements:
Purchases	—			(3,999		)	—			(11,291		)
Settlements⁽¹⁾	4,881			1,595			10,130			4,522
Balance of Level 3 at end of period	$	(14,963	)	$	(26,132	)	$	(14,963	)	$	(26,132	)

______________________________________________________________________________

(1) The settlement amounts for each of the three and nine months ended September 30, 2013, include $2.2 million in deferred premiums which were settled net with the early terminated contracts from which they derive.

2. Fair value measurement on a nonrecurring basis

The Company accounts for additions to its asset retirement obligation (see Note B.11) and the impairment of long-lived assets (see Note B.14), if any, at fair value on a nonrecurring basis. For purposes of fair value measurement, it was determined that the impairment of long-lived assets and the additions to the asset retirement obligation are classified as Level 3, based on the use of internally developed cash flow models. No impairments of long-lived assets were recorded in the three or nine months ended September 30, 2013 or 2012.

Inherent in the fair value calculation of asset retirement obligations are numerous assumptions and judgments including, in addition to those noted above, the ultimate settlement of these amounts, the ultimate timing of such settlement, and changes in legal, regulatory, environmental and political environments. To the extent future revisions to these assumptions impact the fair value of the existing asset retirement obligation liability, a corresponding adjustment will be made to the asset balance.

Asset retirement obligations. The accounting policies for asset retirement obligations are discussed in Note B.11, including a reconciliation of the Company’s asset retirement obligations. The fair value of additions to the asset retirement obligation liability is measured using valuation techniques consistent with the income approach, which converts future cash flows to a single discounted amount. Significant inputs to the valuation include: (i) estimated plug and abandonment cost per well based on Company experience; (ii) estimated remaining life per well based on the reserve life per well; (iii) future inflation factors; and (iv) the Company’s average credit adjusted risk free rate.

Impairment of oil and natural gas properties. The accounting policies for impairment of oil and natural gas properties are discussed in the audited consolidated financial statements and notes thereto included in the 2012 Annual Report. Significant inputs included in the calculation of discounted cash flows used in the impairment analysis include the Company’s estimate of operating and development costs, anticipated production of proved reserves and other relevant data.

Commitments and Contingencies Disclosure [Abstract]

The entire disclosure for the fair value of financial instruments (as defined), including financial assets and financial liabilities (collectively, as defined), and the measurements of those instruments as well as disclosures related to the fair value of non-financial assets and liabilities. Such disclosures about the financial instruments, assets, and liabilities would include: (1) the fair value of the required items together with their carrying amounts (as appropriate); (2) for items for which it is not practicable to estimate fair value, disclosure would include: (a) information pertinent to estimating fair value (including, carrying amount, effective interest rate, and maturity, and (b) the reasons why it is not practicable to estimate fair value; (3) significant concentrations of credit risk including: (a) information about the activity, region, or economic characteristics identifying a concentration, (b) the maximum amount of loss the entity is exposed to based on the gross fair value of the related item, (c) policy for requiring collateral or other security and information as to accessing such collateral or security, and (d) the nature and brief description of such collateral or security; (4) quantitative information about market risks and how such risks are managed; (5) for items measured on both a recurring and nonrecurring basis information regarding the inputs used to develop the fair value measurement; and (6) for items presented in the financial statement for which fair value measurement is elected: (a) information necessary to understand the reasons for the election, (b) discussion of the effect of fair value changes on earnings, (c) a description of [similar groups] items for which the election is made and the relation thereof to the balance sheet, the aggregate carrying value of items included in the balance sheet that are not eligible for the election; (7) all other required (as defined) and desired information.

+ References + Details

Credit risk	9 Months Ended
Credit risk	Sep. 30, 2013
Risks and Uncertainties [Abstract]
Credit risk	H—Credit risk The Company’s oil and natural gas sales are to a variety of purchasers, including intrastate and interstate pipelines or their marketing affiliates and independent marketing companies. The Company’s joint operations accounts receivable are from a number of oil and natural gas companies, partnerships, individuals and others who own interests in the properties operated by the Company. Management believes that any credit risk imposed by a concentration in the oil and natural gas industry is offset by the creditworthiness of the Company’s customer base and industry partners. The Company routinely assesses the recoverability of all material trade and other receivables to determine collectability. The Company uses derivative instruments to hedge its exposure to oil and natural gas price volatility and its exposure to interest rate risk associated with the Senior Secured Credit Facility. These transactions expose the Company to potential credit risk from its counterparties. In accordance with the Company’s standard practice, its derivative instruments are subject to counterparty netting under agreements governing such derivatives; therefore, the credit risk associated with its derivative counterparties is somewhat mitigated. See Note F for additional information regarding the Company’s derivative instruments.

Commitments and contingencies

9 Months Ended

Sep. 30, 2013

Commitments and contingencies

I—Commitments and contingencies

1. Lease commitments

The Company leases equipment and office space under operating leases expiring on various dates through 2022. Minimum annual lease commitments as of September 30, 2013 and for the calendar years following are as follows:



(in thousands)
Remaining 2013	$	487
2014	1,994
2015	2,088
2016	1,923
2017	1,823
Thereafter	3,105
Total	$	11,420

The following table presents rent expense for the periods presented:



	Three months ended September 30,				Nine months ended September 30,
(in thousands)	2013		2012		2013		2012
Rent expense	$	499	$	333	$	1,423	$	935

The Company’s office space lease agreements contain scheduled escalation in lease payments during the term of the lease. The Company records rent expense on a straight-line basis and a deferred lease liability for the difference between the straight-line amount and the actual amounts of the lease payments.

2. Litigation

The Company may be involved in legal proceedings or is subject to industry rulings that could bring rise to claims in the ordinary course of business. The Company has concluded that the likelihood is remote that the ultimate resolution of any pending litigation or pending claims will be material or have a material adverse effect on the Company’s business, financial position, results of operations or liquidity.

3. Drilling contracts

The Company has committed to several short-term drilling contracts with various third parties in order to complete its various drilling projects. The contracts contain an early termination clause that requires the Company to pay significant penalties to the third party should the Company cease drilling efforts. These penalties could significantly impact the Company’s financial statements upon contract termination. These commitments are not recorded in the accompanying unaudited consolidated balance sheets. Future commitments are $35.3 million as of September 30, 2013. Management has not canceled and does not anticipate canceling any drilling contracts in 2013.

4. Federal and state regulations

Oil and natural gas exploration, production and related operations are subject to extensive federal and state laws, rules and regulations. Failure to comply with these laws, rules and regulations can result in substantial penalties. The regulatory burden on the oil and natural gas industry increases the cost of doing business and affects profitability. The Company believes that it is in compliance with currently applicable state and federal regulations related to oil and natural gas exploration and production, and that compliance with the current regulations will not have a material adverse impact on the financial position or results of operations of the Company. Because these rules and regulations are frequently amended or reinterpreted, the Company is unable to predict the future cost or impact of complying with these regulations.

Net income (loss) per share

9 Months Ended

Sep. 30, 2013

Earnings Per Share [Abstract]

Net income (loss) per share

J—Net income (loss) per share

Basic net income (loss) per share is computed by dividing net income (loss) by the weighted average number of shares outstanding for the period. Diluted net income (loss) per share reflects the potential dilution of non-vested restricted stock awards. The effect of the Company's outstanding options that were granted in February 2012 to purchase 391,156 shares of common stock at $24.11 per share (the "February 2012 Option Grant") were excluded from the calculation of diluted net income (loss) per share for the nine months ended September 30, 2013 and for the three and nine months ended September 30, 2012 because the exercise price of those options was greater than the average market price during the period, and, therefore, the inclusion of these outstanding options would have been anti-dilutive. The effect of the Company's outstanding options that were granted in February 2013 to purchase 928,826 shares of common stock at $17.34 per share were excluded from the calculation of diluted net income (loss) per share for the three and nine months ended September 30, 2013 and the effect of the Company's February 2012 Option Grant was excluded from the calculation of diluted net income (loss) per share for the three months ended September 30, 2013, because, utilizing the treasury method, the sum of the assumed proceeds exceeds the average stock price during the period and, therefore, the inclusion of these outstanding options would have been anti-dilutive.

The following is the calculation of basic and diluted weighted average shares outstanding and net income (loss) per share for the periods presented:



	Three months ended September 30,					Nine months ended September 30,
(in thousands, except for per share data)	2013		2012			2013		2012
Net income (loss) (numerator):
Income (loss) from continuing operations—basic and diluted	$	11,817	$	(7,271	)	$	48,248	$	49,889
Income (loss) from discontinued operations—basic and diluted	726		(113		)	1,516		(63		)
Net income (loss)—basic and diluted	$	12,543	$	(7,384	)	$	49,764	$	49,826
Weighted average shares (denominator):
Weighted average shares—basic	134,461		127,001			129,701		126,909
Non-vested restricted stock⁽¹⁾	1,999		—			1,888		1,239
Weighted average shares—diluted	136,460		127,001			131,589		128,148
Net income (loss) per share:
Basic:
Income (loss) from continuing operations	$	0.09	$	(0.06	)	$	0.37	$	0.39
Income (loss) from discontinued operations, net of tax	—		—			0.01		—
Net income (loss) per share	$	0.09	$	(0.06	)	$	0.38	$	0.39

Diluted:
Income (loss) from continuing operations	$	0.09	$	(0.06	)	$	0.37	$	0.39
Income (loss) from discontinued operations, net of tax	—		—			0.01		—
Net income (loss) per share	$	0.09	$	(0.06	)	$	0.38	$	0.39

______________________________________________________________________________

(1) For the three months ended September 30, 2012, the effect of the Company's 1,143,108 non-vested shares outstanding were anti-dilutive due to the Company's net loss and therefore were excluded from the calculation of diluted net loss per share.

Variable interest entity	9 Months Ended
Variable interest entity	Sep. 30, 2013
Variable Interest Entity [Abstract]
Variabe Interest Entity [Text Block]	K—Variable interest entity An entity is referred to as a variable interest entity ("VIE") pursuant to accounting guidance for consolidation if it possesses one of the following criteria: (i) it is thinly capitalized, (ii) the residual equity holders do not control the entity, (iii) the equity holders are shielded from the economic losses, (iv) the equity holders do not participate fully in the entity's residual economics, or (v) the entity was established with non-substantive voting interests. In order to determine if a VIE should be consolidated, an entity must determine if it is the primary beneficiary of the VIE. The primary beneficiary of a VIE is that variable interest holder possessing a controlling financial interest through: (i) its power to direct the activities of the VIE that most significantly impact the VIE’s economic performance and (ii) its obligation to absorb losses or its right to receive benefits from the VIE that could potentially be significant to the VIE. In order to determine whether the Company owns a variable interest in a VIE, a qualitative analysis is performed of the entity’s design, organizational structure, primary decision makers and relevant agreements. The Company continually monitors its VIE exposure to determine if any events have occurred that could cause the primary beneficiary to change. On January 4, 2013 and April 22, 2013, Laredo Gas contributed approximately $0.9 million and $2.3 million, respectively, to Medallion Gathering & Processing, LLC (“Medallion”), a Texas limited liability company. Laredo Gas holds 49% of Medallion ownership units. Medallion was formed on October 31, 2012 for the purpose of developing midstream solutions and providing midstream infrastructure to bring discovered oil and natural gas to market in the Permian-China Grove area. Laredo Gas and the other 51% interest-holder have agreed that the voting rights of Medallion, the profit and loss sharing, and the additional capital contribution requirements shall be equal to the ownership unit percentage held. Additionally, Medallion requires a super-majority vote of 75% for all key operation and business decisions. The Company has determined that Medallion is a VIE. However, Laredo Gas is not considered to be the primary beneficiary of the VIE because Laredo Gas does not have the power to direct the activities that most significantly affect Medallion's economic performance. As such, Medallion is accounted for under the equity method of accounting with the Company's proportionate share of net loss reflected in the unaudited consolidated statements of operations as "Income (loss) from equity method investee" and the carrying amount reflected in the unaudited consolidated balance sheet as "Investment in equity method investee."

Recently issued accounting standards	9 Months Ended
Recently issued accounting standards	Sep. 30, 2013
New Accounting Pronouncements and Changes in Accounting Principles [Abstract]
Recently issued accounting standards	L—Recently issued accounting standards In December 2011, the Financial Accounting Standards Board ("FASB") issued guidance to improve reporting and transparency of offsetting (netting) assets and liabilities and the related effects on the financial statements. The Company adopted this guidance on January 1, 2013. The adoption did not have an impact on the consolidated financial statements. In July 2013, the FASB issued guidance on the presentation of unrecognized tax benefits when a net operating loss carryforward, a similar tax loss, or a tax credit carryforward exists at the reporting date. This guidance is effective for fiscal years, and interim periods within those years, beginning after December 15, 2013. The Company does not expect the adoption to have an impact on the consolidated financial statements.

Condensed Financial Information of Parent Company Only Disclosure [Abstract]

The entire disclosure of changes in accounting principles, including adoption of new accounting pronouncements, that describes the new methods, amount and effects on financial statement line items.

+ References

Reference 1: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Glossary Change in Accounting Principle
-URI http://asc.fasb.org/extlink&oid=6507316

Reference 2: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Glossary Direct Effects of a Change in Accounting Principle
-URI http://asc.fasb.org/extlink&oid=6510796

Reference 3: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 250
-SubTopic 10
-Section 50
-Paragraph 3
-URI http://asc.fasb.org/extlink&oid=28359718&loc=d3e22583-107794

Reference 4: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Glossary Indirect Effects of a Change in Accounting Principle
-URI http://asc.fasb.org/extlink&oid=6515603

Reference 5: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 250
-SubTopic 10
-Section 50
-Paragraph 2
-URI http://asc.fasb.org/extlink&oid=28359718&loc=d3e22580-107794

Reference 6: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 270
-SubTopic 10
-Section S99
-Paragraph 1
-Subparagraph (SX 210.10-01.(b)(6))
-URI http://asc.fasb.org/extlink&oid=27015980&loc=d3e46468-122699

Reference 7: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Glossary Accounting Change
-URI http://asc.fasb.org/extlink&oid=6503790

Reference 8: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 250
-SubTopic 10
-Section 50
-Paragraph 1
-URI http://asc.fasb.org/extlink&oid=28359718&loc=d3e22499-107794

Reference 9: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Glossary Retrospective Application
-URI http://asc.fasb.org/extlink&oid=6523989

Reference 10: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 270
-SubTopic 10
-Section 45
-Paragraph 13
-URI http://asc.fasb.org/extlink&oid=6372559&loc=d3e765-108305

Reference 11: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 270
-SubTopic 10
-Section 45
-Paragraph 12
-URI http://asc.fasb.org/extlink&oid=6372559&loc=d3e725-108305

Reference 12: http://www.xbrl.org/2003/role/presentationRef
-Publisher SEC
-Name Regulation S-X (SX)
-Number 210
-Section 01
-Paragraph b
-Subparagraph 6
-Article 10

+ Details

Subsidiary guarantees

9 Months Ended

Sep. 30, 2013

Subsidiary guarantees

M—Subsidiary guarantees

All of Laredo's wholly-owned subsidiaries (Laredo Gas, Laredo Texas and Laredo Dallas, collectively, the "Subsidiary Guarantors") and Laredo Holdings have fully and unconditionally guaranteed the 2019 Notes, the 2022 Notes and the Senior Secured Credit Facility. In accordance with practices accepted by the Securities Exchange Commission, Laredo has prepared condensed consolidating financial statements in order to quantify the assets, results of operations and cash flows of such subsidiaries as subsidiary guarantors. The following condensed consolidating balance sheets as of September 30, 2013 and December 31, 2012, condensed consolidating statements of operations for the three and nine months ended September 30, 2013 and 2012 and condensed consolidating statements of cash flows for the nine months ended September 30, 2013 and 2012, present financial information for Laredo Holdings, as the parent of Laredo on a stand-alone basis (carrying any investments in subsidiaries under the equity method), financial information for Laredo on a stand-alone basis (carrying any investment in subsidiaries under the equity method), financial information for the Subsidiary Guarantors on a stand-alone basis (carrying any investment in subsidiaries under the equity method), and the consolidation and elimination entries necessary to arrive at the information for the Company on a condensed consolidated basis. Deferred income taxes for Laredo Gas and Laredo Texas are recorded on Laredo's statements of financial position, statements of operations and statements of cash flow as they are flow-through entities for income tax purposes. Laredo Holdings, Laredo and the Subsidiary Guarantors are not restricted from making distributions to and from one another.

Condensed consolidating balance sheet

September 30, 2013

(Unaudited)



(in thousands)	Laredo Holdings		Laredo		Subsidiary Guarantors		Intercompany eliminations			Consolidated company
Accounts receivable	$	—	$	47,091	$	30,685	$	—		$	77,776
Other current assets	—		271,203		3,868		—			275,071
Oil and natural gas properties, net	—		993,877		1,003,555		—			1,997,432
Pipeline and gas gathering assets, net	—		—		32,888		—			32,888
Other fixed assets, net	—		20,999		5,050		—			26,049
Investment in subsidiaries	1,195,127		936,752		—		(2,131,879		)	—
Total other long-term assets	226		128,061		3,221		(60,563		)	70,945
Total assets	$	1,195,353	$	2,397,983	$	1,079,267	$	(2,192,442	)	$	2,480,161
Accounts payable	$	1	$	23,414	$	7,444	$	—		$	30,859
Other current liabilities	—		112,496		64,445		—			176,941
Other long-term liabilities	—		15,351		70,626		(60,563		)	25,414
Long-term debt	—		1,051,595		—		—			1,051,595
Stockholders’ equity	1,195,352		1,195,127		936,752		(2,131,879		)	1,195,352
Total liabilities and stockholders’ equity	$	1,195,353	$	2,397,983	$	1,079,267	$	(2,192,442	)	$	2,480,161

Condensed consolidating balance sheet

December 31, 2012

(Unaudited)



(in thousands)	Laredo Holdings		Laredo		Subsidiary Guarantors		Intercompany eliminations			Consolidated company
Accounts receivable	$	—	$	59,447	$	24,393	$	—		$	83,840
Other current assets	—		52,147		1,450		—			53,597
Oil and natural gas properties, net	—		1,213,946		817,992		—			2,031,938
Pipeline and gas gathering assets, net	—		—		65,292		—			65,292
Other fixed assets, net	—		13,837		2,824		—			16,661
Investment in subsidiaries	831,641		782,635		—		(1,614,276		)	—
Total other long-term assets	83		136,403		—		(49,510		)	86,976
Total assets	$	831,724	$	2,258,415	$	911,951	$	(1,663,786	)	$	2,338,304
Accounts payable	$	1	$	35,948	$	12,723	$	—		$	48,672
Other current liabilities	—		157,805		55,591		—			213,396
Other long-term liabilities	—		16,261		61,002		(49,510		)	27,753
Long-term debt	—		1,216,760		—		—			1,216,760
Stockholders’ equity	831,723		831,641		782,635		(1,614,276		)	831,723
Total liabilities and stockholders’ equity	$	831,724	$	2,258,415	$	911,951	$	(1,663,786	)	$	2,338,304

Condensed consolidating statement of operations

For the three months ended September 30, 2013

(Unaudited)



(in thousands)	Laredo Holdings			Laredo			Subsidiary Guarantors		Intercompany eliminations			Consolidated company
Total operating revenues	$	—		$	76,952		$	96,131	$	(2,243	)	$	170,840
Total operating costs and expenses	42			69,880			45,741		(2,243		)	113,420
Income (loss) from operations	(42		)	7,072			50,390		—			57,420
Interest expense, net	—			(24,870		)	—		—			(24,870		)
Other, net	12,561			(15,291		)	4,606		(12,561		)	(10,685		)
Income (loss) from continuing operations before income tax	12,519			(33,089		)	54,996		(12,561		)	21,865
Income tax (expense) benefit	24			(25,749		)	15,677		—			(10,048		)
Income (loss) from continuing operations	12,543			(58,838		)	70,673		(12,561		)	11,817
Income from discontinued operations, net of tax	—			346			380		—			726
Net income (loss)	$	12,543		$	(58,492	)	$	71,053	$	(12,561	)	$	12,543

Condensed consolidating statement of operations

For the three months ended September 30, 2012

(Unaudited)



(in thousands)	Laredo Holdings			Laredo			Subsidiary Guarantors			Intercompany eliminations			Consolidated company
Total operating revenues	$	—		$	75,179		$	71,411		$	(2,755	)	$	143,835
Total operating costs and expenses	12			69,435			39,937			(2,755		)	106,629
Income (loss) from operations	(12		)	5,744			31,474			—			37,206
Interest expense, net	—			(24,410		)	—			—			(24,410		)
Other, net	(7,376		)	(24,156		)	(1		)	7,376			(24,157		)
Income (loss) from continuing operations before income tax	(7,388		)	(42,822		)	31,473			7,376			(11,361		)
Income tax (expense) benefit	4			2,821			1,265			—			4,090
Income (loss) from continuing operations	(7,384		)	(40,001		)	32,738			7,376			(7,271		)
Loss from discontinued operations, net of tax	—			(63		)	(50		)	—			(113		)
Net income (loss)	$	(7,384	)	$	(40,064	)	$	32,688		$	7,376		$	(7,384	)

Condensed consolidating statement of operations

For the nine months ended September 30, 2013

(Unaudited)



(in thousands)	Laredo Holdings			Laredo			Subsidiary Guarantors			Intercompany eliminations			Consolidated company
Total operating revenues	$	—		$	249,775		$	269,637		$	(7,571	)	$	511,841
Total operating costs and expenses	358			220,564			139,151			(7,571		)	352,502
Income (loss) from operations	(358		)	29,211			130,486			—			159,339
Interest expense, net	—			(76,135		)	—			—			(76,135		)
Other, net	49,987			(8,244		)	4,493			(49,987		)	(3,751		)
Income (loss) from continuing operations before income tax	49,629			(55,168		)	134,979			(49,987		)	79,453
Income tax (expense) benefit	135			(21,403		)	(9,937		)	—			(31,205		)
Income (loss) from continuing operations	49,764			(76,571		)	125,042			(49,987		)	48,248
Income from discontinued operations, net of tax	—			11			1,505			—			1,516
Net income (loss)	$	49,764		$	(76,560	)	$	126,547		$	(49,987	)	$	49,764

Condensed consolidating statement of operations

For the nine months ended September 30, 2012

(Unaudited)



(in thousands)	Laredo Holdings			Laredo			Subsidiary Guarantors			Intercompany eliminations			Consolidated company
Total operating revenues	$	—		$	227,637		$	212,569		$	(7,644	)	$	432,562
Total operating costs and expenses	171			195,625			110,370			(7,644		)	298,522
Income (loss) from operations	(171		)	32,012			102,199			—			134,040
Interest expense, net	—			(60,737		)	—			—			(60,737		)
Other, net	49,937			4,658			(9		)	(49,937		)	4,649
Income (loss) from continuing operations before income tax	49,766			(24,067		)	102,190			(49,937		)	77,952
Income tax (expense) benefit	60			(8,038		)	(20,085		)	—			(28,063		)
Income (loss) from continuing operations	49,826			(32,105		)	82,105			(49,937		)	49,889
Income (loss) from discontinued operations, net of tax	—			(303		)	240			—			(63		)
Net income (loss)	$	49,826		$	(32,408	)	$	82,345		$	(49,937	)	$	49,826

Condensed consolidating statement of cash flows

For the nine months ended September 30, 2013

(Unaudited)



(in thousands)	Laredo Holdings			Laredo			Subsidiary Guarantors			Intercompany eliminations			Consolidated company
Net cash flows provided by operating activities	$	49,621		$	71,033		$	204,770		$	(49,986	)	$	275,438
Net cash flows (used in) provided by investing activities	(348,380		)	328,206			(204,770		)	49,986			(174,958		)
Net cash flows provided by (used in) financing activities	298,759			(167,193		)	—			—			131,566
Net increase in cash and cash equivalents	—			232,046			—			—			232,046
Cash and cash equivalents at beginning of period	—			33,224			—			—			33,224
Cash and cash equivalents at end of period	$	—		$	265,270		$	—		$	—		$	265,270

Condensed consolidating statement of cash flows

For the nine months ended September 30, 2012

(Unaudited)



(in thousands)	Laredo Holdings			Laredo			Subsidiary Guarantors			Intercompany eliminations			Consolidated company
Net cash flows provided by operating activities	$	49,766		$	79,884		$	176,822		$	(23,015	)	$	283,457
Net cash flows used in investing activities	(104,687		)	(505,291		)	(176,825		)	49,937			(736,866		)
Net cash flows provided by financing activities	—			454,524			—			—			454,524
Net increase (decrease) in cash and cash equivalents	(54,921		)	29,117			(3		)	26,922			1,115
Cash and cash equivalents at beginning of period	54,921			—			3			(26,922		)	28,002
Cash and cash equivalents at end of period	$	—		$	29,117		$	—		$	—		$	29,117

Subsequent events	9 Months Ended
Subsequent events	Sep. 30, 2013
Subsequent Events [Abstract]
Subsequent events	N—Subsequent events 1. Amendment to the Senior Secured Credit Facility On November 4, 2013, the Company entered into the Seventh Amendment to the Senior Secured Credit Facility, pursuant to which, among other things, (i) the maturity date of the Senior Secured Credit Facility was extended to November 4, 2018, (ii) the borrowing base was increased to $925.0 million with an aggregate elected commitment amount of $825.0 million, (iii) the percentage of anticipated production from proved reserves that is available for hedging was increased and (iv) certain non-financial covenants were revised and updated.

Supplementary information

9 Months Ended

Sep. 30, 2013

Supplemental Information Disclosure Abstract

Supplementary information

O—Supplementary information

Costs incurred in oil and natural gas property acquisition, exploration and development activities

Costs incurred in the acquisition, exploration and development of oil and natural gas assets are presented below for the periods presented:



	Three months ended September 30,				Nine months ended September 30,
(in thousands)	2013		2012		2013		2012
Property acquisition costs:
Proved	$	9,652	$	16,925	$	9,652	$	16,925
Unproved	27,087		3,693		27,087		3,693
Exploration	8,317		13,911		29,245		65,597
Development costs⁽¹⁾	148,877		215,227		471,609		642,826
Total costs incurred	$	193,933	$	249,756	$	537,593	$	729,041

____________________________________________________________________________


(1)	The costs incurred for oil and natural gas development activities include $0.7 million and $1.1 million in asset retirement obligations for the three months ended September 30, 2013 and 2012, respectively, and $2.0 million and $3.4 million for the nine months ended September 30, 2013 and 2012, respectively.

Basis of presentation and significant accounting policies (Policies)	9 Months Ended
	Sep. 30, 2013
Accounting Policies [Abstract]
Basis of presentation	Basis of presentation The accompanying unaudited consolidated financial statements were derived from the historical accounting records of the Company and reflect the historical financial position, results of operations and cash flows for the periods described herein. The Company uses the equity method of accounting to record its net interests when the Company holds 20% to 50% of the voting rights and/or has the ability to exercise significant influence but does not control the entity. Under the equity method, the Company's proportionate share of net income (loss) is included in the unaudited consolidated statements of operations. See Note K for additional discussion of the Company's equity method investment. The accompanying unaudited consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”). All material intercompany transactions and account balances have been eliminated in the consolidation of accounts. The Company operates oil and natural gas properties as one business segment, which explores for, develops and produces oil and natural gas. The accompanying consolidated financial statements have not been audited by the Company’s independent registered public accounting firm, except that the consolidated balance sheet at December 31, 2012 is derived from audited consolidated financial statements. In the opinion of management, the accompanying unaudited consolidated financial statements reflect all necessary adjustments to present fairly the Company’s financial position as of September 30, 2013, the results of operations and cash flows for the three and nine months ended September 30, 2013 and 2012. The Company has reclassified certain prior period amounts in these unaudited consolidated financial statements as discontinued operations. See Notes B.3 and B.4 for additional discussion of these reclassifications. Certain disclosures have been condensed or omitted from these unaudited consolidated financial statements. Accordingly, these unaudited consolidated financial statements should be read in conjunction with the audited consolidated financial statements and notes thereto included in Laredo Holdings’ Annual Report on Form 10-K for the year ended December 31, 2012 (the “2012 Annual Report”).
Use of estimates in the preparation of interim consolidated financial statements	Use of estimates in the preparation of interim unaudited consolidated financial statements The preparation of the accompanying unaudited consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions about future events. These estimates and the underlying assumptions affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Although management believes these estimates are reasonable, actual results could differ from these estimates. The interim results reflected in the unaudited consolidated financial statements are not necessarily indicative of the results that may be expected for other interim periods or for the full year. Significant estimates include, but are not limited to, estimates of the Company’s reserves of oil and natural gas, future cash flows from oil and natural gas properties, depreciation, depletion and amortization, asset retirement obligations, stock-based compensation, deferred income taxes, fair value of assets acquired and liabilities assumed in an acquisition and fair values of commodity derivatives, interest rate derivatives and commodity deferred premiums. As fair value is a market-based measurement, it is determined based on the assumptions that market participants would use. These estimates and assumptions are based on management’s best judgment. Management evaluates its estimates and assumptions on an ongoing basis using historical experience and other factors, including the current economic environment. Such estimates and assumptions are adjusted when facts and circumstances dictate. Illiquid credit markets and volatile equity and energy markets have combined to increase the uncertainty inherent in such estimates and assumptions. Management believes its estimates and assumptions to be reasonable under the circumstances. As future events and their effects cannot be determined with precision, actual values and results could differ from these estimates. Any changes in estimates resulting from future changes in the economic environment will be reflected in the financial statements in future periods.
Acquisition	Acquisitions are accounted for under the acquisition method of accounting. Accordingly, the Company conducts assessments of net assets acquired and recognizes amounts for identifiable assets acquired and liabilities assumed at the estimated acquisition date fair values, while transaction and integration costs associated with the acquisitions are expensed as incurred.
Treasury stock	The Company acquires treasury stock, which is recorded at cost, to satisfy tax withholding obligations for Laredo's employees that arise upon the lapse of restrictions on restricted stock or for other reasons. Upon acquisition, this treasury stock is retired.
Accounts receivable	Accounts receivable for joint interest billings are recorded as amounts billed to customers less an allowance for doubtful accounts. Amounts are considered past due after 30 days. The Company determines joint interest operations accounts receivable allowances based on management’s assessment of the creditworthiness of the joint interest owners. Additionally, as the operator in the majority of its wells, the Company has the ability to realize the receivables through netting of anticipated future production revenues. The Company maintains an allowance for doubtful accounts for estimated losses inherent in its accounts receivable portfolio. In establishing the required allowance, management considers historical losses, current receivables aging, and existing industry and economic data. The Company reviews its allowance for doubtful accounts quarterly. Past due balances greater than 90 days and over a specified amount are reviewed individually for collectability. Account balances are charged off against the allowance after all means of collection have been exhausted and the potential for recovery is remote.
Derivative financial instruments	Derivative instruments are recorded at fair value and are included on the unaudited consolidated balance sheets as assets or liabilities. The Company netted the fair value of derivative instruments by counterparty in the accompanying unaudited consolidated balance sheets where the right of offset exists. The Company determines the fair value of its derivative financial instruments utilizing pricing models for substantially similar instruments. Inputs to the pricing models include publicly available prices and forward price curves generated from a compilation of data gathered from third parties. The Company’s derivatives were not designated as hedges for accounting purposes for any of the periods presented. Accordingly, the changes in fair value are recognized in the unaudited consolidated statements of operations in the period of change. Gains and losses on derivative financial instruments are included in cash flows from operating activities (see Note F).
Deferred loan costs	Loan origination fees, which are stated at cost, net of amortization, are amortized over the life of the respective debt agreements utilizing the effective interest and straight-line methods.
Asset retirement obligations	Asset retirement obligations associated with the retirement of tangible long-lived assets are recognized as a liability in the period in which they are incurred and become determinable. The associated asset retirement costs are part of the carrying amount of the long-lived asset. Subsequently, the asset retirement costs included in the carrying amount of the related long-lived asset are charged to expense through the depletion of the asset. Changes in the liability due to the passage of time are recognized as an increase in the carrying amount of the liability and as corresponding accretion expense. See Note G for fair value disclosures related to the Company’s asset retirement obligations. The Company is obligated by contractual and regulatory requirements to remove certain pipeline and gas gathering assets and perform other remediation of the sites where such pipeline and gas gathering assets are located upon the retirement of those assets. However, the fair value of the asset retirement obligation cannot currently be reasonably estimated because the settlement dates are indeterminate. The Company will record an asset retirement obligation for pipeline and gas gathering assets in the periods in which settlement dates are reasonably determinable.
Fair value measurements	The carrying amounts reported in the unaudited consolidated balance sheets for cash and cash equivalents, accounts receivable, prepaid expenses, accounts payable, undistributed revenue and royalties and other accrued liabilities approximate their fair values. See Note C for fair value disclosures related to the Company’s debt obligations. The Company carries its derivative financial instruments at fair value. See Note F and Note G for details regarding the fair value of the Company’s derivative financial instruments.
Compensation awards	For stock-based compensation awards, compensation expense is recognized in “General and administrative” in the Company’s unaudited consolidated statements of operations over the awards’ vesting periods based on their grant date fair value. The Company utilizes the closing stock price on the date of grant, less an expected forfeiture rate, to determine the fair value of service vesting restricted stock awards and a Black-Scholes pricing model to determine the fair values of service vesting restricted stock option awards. The Company utilizes a Monte Carlo simulation prepared by an independent third party to determine the fair value of the performance unit awards. See Note D for further discussion of the restricted stock awards, restricted stock option awards and performance unit awards.
Impairment of long-lived assets	Impairment losses are recorded on property and equipment used in operations and other long-lived assets when indicators of impairment are present and the undiscounted cash flows estimated to be generated by those assets are less than the assets’ carrying amount. Impairment is measured based on the excess of the carrying amount over the fair value of the assets. The Company did not record any impairment to property and equipment used in operations or other long-lived assets for the three or nine months ended September 30, 2013 and 2012.
Environmental	The Company is subject to extensive federal, state and local environmental laws and regulations. These laws, among other things, regulate the discharge of materials into the environment and may require the Company to remove or mitigate the environmental effects of the disposal or release of petroleum or chemical substances at various sites. Environmental expenditures are expensed in the period in which they occur. Expenditures that relate to an existing condition caused by past operations and that have no future economic benefits are expensed in the period in which they occur. Liabilities for expenditures of a non-capital nature are recorded when environmental assessment or remediation is probable and the costs can be reasonably estimated. Such liabilities are generally undiscounted unless the timing of cash payments is fixed and readily determinable. Management believes no materially significant liabilities of this nature existed as of September 30, 2013 or December 31, 2012.

Basis of presentation and significant accounting policies (Tables)

9 Months Ended

Sep. 30, 2013

Accounting Policies [Abstract]

Estimated fair value of assets acquired and associated liabilities of acquisition

The following table reflects the estimated fair value of the acquired assets and liabilities associated with this acquisition as of September 6, 2013:



(in thousands)
Fair value of net assets:
Proved oil and natural gas properties⁽¹⁾	$	9,652
Unproved oil and natural gas properties⁽¹⁾	27,087
Other assets	200
Total assets acquired	36,939
Liabilities assumed	(200		)
Net assets acquired	$	36,739
Fair value of consideration paid for net assets:
Cash consideration	$	34,000
Common stock issued⁽²⁾	3,029
Closing cost adjustments	(290		)
Total consideration paid for net assets	$	36,739

_____________________________________________________________________________

Operating results from discontinued operations



	Three months ended September 30,				Nine months ended September 30,
(in thousands)	2013		2012		2013		2012
Revenues	$	11,429	$	19,915	$	61,166	$	64,829
Direct operating expenses	9,283		24,440		50,120		67,804

The following represents operating results from discontinued operations for the periods presented:



	Three months ended September 30,						Nine months ended September 30,
(in thousands)	2013			2012			2013			2012
Revenues:
Natural gas transportation and treating	$	761		$	865		$	4,071		$	3,110
Total revenues from discontinued operations	761			865			4,071			3,110
Cost and expenses:
Natural gas transportation and treating	211			330			1,180			964
Drilling and production	(497		)	53			(17		)	338
Depreciation, depletion and amortization	—			659			627			1,907
Total costs and expenses from discontinued operations	(286		)	1,042			1,790			3,209
Income (loss) from discontinued operations before income tax	1,047			(177		)	2,281			(99		)
Income tax (expense) benefit	(321		)	64			(765		)	36
Income (loss) from discontinued operations	$	726		$	(113	)	$	1,516		$	(63	)

Schedule of components of accounts receivable

Accounts receivable consist of the following components for the periods presented:



(in thousands)	September 30, 2013		December 31, 2012
Oil and natural gas sales	$	53,028	$	48,445
Joint operations, net⁽¹⁾	24,112		30,925
Other	636		4,470
Total	$	77,776	$	83,840

______________________________________________________________________________


(1)	Accounts receivable for joint operations are presented net of an allowance for doubtful accounts of approximately $0.7 million and $0.1 million at September 30, 2013 and December 31, 2012.

Schedule of property and equityment

The following table sets forth the Company’s property and equipment for the periods presented:



(in thousands)	September 30, 2013		December 31, 2012
Proved oil and natural gas properties	$	3,099,194	$	2,993,266
Less accumulated depletion and impairment	1,303,812		1,121,274
Proved oil and natural gas properties, net	1,795,382		1,871,992

Unproved properties not being amortized	202,050		159,946

Pipeline and gas gathering assets	35,193		74,877
Less accumulated depreciation	2,305		9,585
Pipeline and gas gathering assets, net	32,888		65,292

Other fixed assets	37,477		25,599
Less accumulated depreciation and amortization	11,428		8,938
Other fixed assets, net	26,049		16,661

Total property and equipment, net	$	2,056,369	$	2,113,891

Schedule of future amortization expense of deferred loan costs

Future amortization expense of deferred loan costs as of September 30, 2013 is as follows:



(in thousands)
Remaining 2013	$	1,241
2014	5,004
2015	5,066
2016	3,771
2017	2,725
Thereafter	6,943
Total	$	24,750

Schedule of components of other current liabilities

Other current liabilities consist of the following components for the periods presented:



(in thousands)	September 30, 2013		December 31, 2012
Lease operating expense payable	$	9,630	$	9,766
Production taxes payable	2,556		2,121
Prepaid drilling liability	95		2,916
Current portion of asset retirement obligations	275		385
Other accrued liabilities	6,115		2,782
Total other current liabilities	$	18,671	$	17,970

Schedule of reconciliation of asset retirement obligations liability

The following reconciles the Company’s asset retirement obligations liability for continuing and discontinued operations for the periods presented:



(in thousands)	Nine months ended September 30, 2013			Year ended December 31, 2012
Liability at beginning of period	$	21,505		$	13,074
Liabilities added due to acquisitions, drilling and other	1,978			4,233
Accretion expense	1,154			1,200
Liabilities settled upon plugging and abandonment	(216		)	(148		)
Liabilities removed due to Anadarko Basin Sale	(7,801		)	—
Revision of estimates	—			3,146
Liability at end of period	$	16,620		$	21,505

Summary of related party disclosures



	Three months ended September 30,				Nine months ended September 30,
(in thousands)	2013		2012		2013		2012
Net oil and natural gas sales	$	20,358	$	15,940	$	58,146	$	53,680

The following table summarizes the related-party amounts included in oil and natural gas sales receivable in the unaudited consolidated balance sheets for the periods presented:



(in thousands)	September 30, 2013		December 31, 2012
Oil and natural gas sales receivable	$	8,078	$	6,244

Supplemental cash flow disclosure information and non-cash investing and financing infromation

The following table summarizes the supplemental disclosure of cash flow information for the periods presented:



	Nine months ended September 30,
(in thousands)	2013		2012
Cash paid for interest, net of $255 and $567 of capitalized interest, respectively	$	74,932	$	54,809

The following presents the supplemental disclosure of non-cash investing and financing information for the periods presented:



	Nine months ended September 30,
(in thousands)	2013			2012
Change in accrued capital expenditures	$	(41,001	)	$	6,774
Capitalized asset retirement cost	1,978			3,407
Equity issued in connection with acquisition	3,029			—

Debt (Tables)

9 Months Ended

Sep. 30, 2013

Debt Disclosure [Abstract]

Schedule of amounts incurred and charged to interest expenses

The following amounts have been incurred and charged to interest expense for the periods presented:



	Three months ended September 30,						Nine months ended September 30,
(in thousands)	2013			2012			2013			2012
Cash payments for interest	$	26,627		$	26,915		$	75,187		$	55,376
Change in net present value of deferred premiums for derivative financial instruments	102			176			384			495
Amortization of deferred loan costs and other adjustments	2,634			1,127			4,976			3,129
Change in accrued interest	(4,391		)	(3,733		)	(4,071		)	2,348
Interest costs incurred	24,972			24,485			76,476			61,348
Less capitalized interest	(43		)	(62		)	(255		)	(567		)
Total interest expense	$	24,929		$	24,423		$	76,221		$	60,781

Schedule of carrying amount and fair value of debt instruments

The following table presents the carrying amount and fair value of the Company’s debt instruments for the periods presented:



	September 30, 2013				December 31, 2012
(in thousands)	Carrying value		Fair value		Carrying value		Fair value
2019 Notes⁽¹⁾	$	551,595	$	614,625	$	551,760	$	616,000
2022 Notes	500,000		532,500		500,000		541,250
Senior Secured Credit Facility	—		—		165,000		165,098
Total value of debt	$	1,051,595	$	1,147,125	$	1,216,760	$	1,322,348

______________________________________________________________________________


(1)	The carrying value of the 2019 Notes includes the October 2011 Notes unamortized bond premium of approximately $1.6 million and $1.8 million as of September 30, 2013 and December 31, 2012, respectively.

Employee compensation (Tables)

9 Months Ended

Sep. 30, 2013

Disclosure of Compensation Related Costs, Share-based Payments [Abstract]

Schedule of outstanding restricted stock awards

The following table reflects the outstanding restricted stock awards for the nine months ended September 30, 2013:



(in thousands, except for weighted average grant date fair values)	Restricted stock awards		Weighted average grant date fair value
Outstanding at December 31, 2012	1,195		$	15.06
Granted	1,445		$	17.95
Forfeited	(192	)	$	18.60
Vested⁽¹⁾	(507	)	$	18.80
Outstanding at September 30, 2013	1,941		$	18.94

______________________________________________________________________________

Schedule of stock option award activity

The following table reflects the stock option award activity for the nine months ended September 30, 2013:



(in thousands, except for weighted average exercise price and contractual term)	Restricted stock option awards		Weighted average exercise price (per option)		Weighted average remaining contractual term (years)
Outstanding at December 31, 2012	459		$	24.11	9.1
Granted	1,019		$	17.46	9.4
Exercised⁽¹⁾	(34	)	$	22.83	9.0
Expired or canceled	(12	)	$	24.11	8.3
Forfeited	(112	)	$	19.96	—
Outstanding at September 30, 2013	1,320		$	19.35	9.1
Vested and exercisable at end of period	107		$	24.11	8.3

_____________________________________________________________________________

Schedule of assumptions used to estimate the fair value of options granted

The assumptions used to estimate the fair value of restricted stock options granted on February 15, 2013 are as follows:



Risk-free interest rate⁽¹⁾	1.19		%
Expected option life⁽²⁾	6.3 years
Expected volatility⁽³⁾	58.89		%
Fair value per option	$	9.67

______________________________________________________________________________


(1)	U.S. Treasury yields as of the grant date were utilized for the risk-free interest rate assumption, matching the treasury yield terms to the expected life of the option.


(2)	As the Company had no exercise history at the time of valuation, expected option life assumptions were developed using the simplified method in accordance with GAAP.


(3)	The Company utilized a peer historical look-back, which was weighted with the Company’s own volatility since the IPO, in order to develop the expected volatility.

Schedule of defined contribution plans disclosures

The following table presents total employer contributions to the plans for the periods presented:



	Three months ended September 30,				Nine months ended September 30,
(in thousands)	2013		2012		2013		2012
Contributions	$	501	$	321	$	1,382	$	963

Income taxes (Tables)

9 Months Ended

Sep. 30, 2013

Income Tax Disclosure [Abstract]

Schedule of income tax (benefit) expense



	Three months ended September 30,					Nine months ended September 30,
(in thousands)	2013			2012		2013			2012
Current taxes:
Federal	$	—		$	—	$	—		$	—
State	—			—		—			—
Deferred taxes:
Federal	(6,032		)	3,987		(26,322		)	(26,832		)
State	(4,016		)	103		(4,883		)	(1,231		)
Income tax (expense) benefit	$	(10,048	)	$	4,090	$	(31,205	)	$	(28,063	)

Schedule of comprehensive provision for income tax

The following presents the comprehensive provision for income taxes for the periods presented:



	Three months ended September 30,					Nine months ended September 30,
(in thousands)	2013			2012		2013			2012
Comprehensive provision for income taxes allocable to:
Continuing operations	$	(10,048	)	$	4,090	$	(31,205	)	$	(28,063	)
Discontinued operations	(321		)	64		(765		)	36
Comprehensive provision for income taxes	$	(10,369	)	$	4,154	$	(31,970	)	$	(28,027	)

Schedule of reconciliation of income tax expense computed by applying the federal income tax rate of 34% to pre-tax income from operations



	Three months ended September 30,						Nine months ended September 30,
(in thousands)	2013			2012			2013			2012
Income tax (expense) benefit computed by applying the statutory rate	$	(7,434	)	$	3,862		$	(27,014	)	$	(26,504	)
State income tax, net of federal tax benefit and increase in valuation allowance	(2,651		)	1,380			(3,223		)	(517		)
Non-deductible stock-based compensation	(156		)	(341		)	(495		)	(996		)
Stock-based compensation tax deficiency	(72		)	—			(483		)	—
Change in deferred tax valuation allowance	(20		)	(20		)	(49		)	(22		)
Other items	285			(791		)	59			(24		)
Income tax (expense) benefit	$	(10,048	)	$	4,090		$	(31,205	)	$	(28,063	)

Schedule of significant components of deferred tax assets

Significant components of the Company’s deferred tax assets for the periods presented are as follows:



(in thousands)	September 30, 2013			December 31, 2012
Derivative financial instruments	$	(2,284	)	$	7,108
Oil and natural gas properties and equipment	(247,745		)	(175,823		)
Net operating loss carry-forward	268,940			222,017
Accrued bonus	1,959			3,502
Stock-based compensation	6,095			2,928
Capitalized interest	2,104			1,850
Other	1,707			1,113
Gross deferred tax asset	30,776			62,695
Valuation allowance	(117		)	(66		)
Net deferred tax asset	$	30,659		$	62,629

Schedule of net deferred tax assets and liabilities as classified in the consolidated balance sheets

Net deferred tax assets and liabilities were classified in the unaudited consolidated balance sheets as follows for the periods presented:



(in thousands)	September 30, 2013		December 31, 2012
Deferred tax asset	$	30,659	$	62,629
Deferred tax liability	—		—
Net deferred tax assets	$	30,659	$	62,629

Derivative financial instruments (Tables)

9 Months Ended

Sep. 30, 2013

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Summary of information of additional commodity derivative contracts

The following table summarizes information about these additional commodity derivative contracts:



	Aggregate volumes	Swap price		Floor price		Ceiling price		Contract period
Oil (volumes in Bbl):
Swap	1,377,000	$	98.10	$	—	$	—	March 2013 - December 2013
Basis swap	4,026,000	$	1.00	$	—	$	—	March 2013 - December 2014
Swap	80,000	$	101.20	$	—	$	—	August 2013 - December 2013
Swap	204,000	$	106.60	$	—	$	—	October 2013 - December 2013
Swap	912,500	$	93.65	$	—	$	—	January 2014 - December 2014
Swap	365,000	$	93.68	$	—	$	—	January 2014 - December 2014
Swap	399,996	$	93.30	$	—	$	—	January 2014 - December 2014
Swap	480,000	$	97.47	$	—	$	—	January 2014 - December 2014
Basis swap⁽¹⁾	14,610,000	$	2.85	$	—	$	—	July 2014 - June 2018
Price collar	1,277,500	$	—	$	80.00	$	98.50	January 2015 - December 2015
Price collar	690,000	$	—	$	80.00	$	95.87	January 2015 - December 2015
Price collar	1,281,000	$	—	$	80.00	$	93.00	January 2016 - December 2016
Price collar	579,000	$	—	$	80.00	$	87.75	January 2016 - December 2016
Natural gas (volumes in MMBtu):
Price collar	2,900,000	$	—	$	3.00	$	4.00	March 2013 - December 2013
Swap	3,338,400	$	4.31	$	—	$	—	June 2013 - December 2013
Swap	3,978,500	$	4.36	$	—	$	—	January 2014 - December 2014

______________________________________________________________________________

(1) This oil basis swap differential is between the Brent index crude oil price and the LLS Argus index crude oil price.

Schedule of derivative contracts transferred to buyer on sale of assets

The following commodity derivative contracts were transferred to a buyer in connection with the Anadarko Basin Sale:



	Aggregate volumes	Swap price		Contract period
Natural gas (volumes in MMBtu):
Swap	2,386,800	$	4.31	August 2013 - December 2013
Swap	3,978,500	$	4.36	January 2014 - December 2014

Summary of derivative contracts unwound in connection with sale of assets

The following commodity derivative contracts were unwound in connection with the Anadarko Basin Sale during the three months ended September 30, 2013:



	Aggregate volumes	Floor price		Ceiling price		Contract period
Natural gas (volumes in MMBtu):
Price collar	2,200,000	$	4.00	$	7.05	September 2013 - December 2013
Put	2,200,000	$	4.00	$	—	September 2013 - December 2013
Price collar	3,480,000	$	4.00	$	7.00	January 2014 - December 2014
Price collar	1,800,000	$	4.00	$	7.05	January 2014 - December 2014
Price collar	1,680,000	$	4.00	$	7.05	January 2014 - December 2014
Price collar	1,560,000	$	3.00	$	5.50	January 2014 - December 2014
Price collar	2,520,000	$	3.00	$	6.00	January 2015 - December 2015
Price collar	2,400,000	$	3.00	$	6.00	January 2015 - December 2015
Price collar	2,400,000	$	3.00	$	6.00	January 2015 - December 2015

Summary of open positions and derivatives in place

The following table summarizes open positions as of September 30, 2013, and represents, as of such date, derivatives in place through June 2018, on annual production volumes:



	Remaining Year 2013		Year 2014		Year 2015		Year 2016		Year 2017		Year 2018
Oil Positions:
Puts:
Hedged volume (Bbl)	270,000		540,000		456,000		—		—		—
Weighted average price ($/Bbl)	$	65.00	$	75.00	$	75.00	$	—	$	—	$	—
Swaps:
Hedged volume (Bbl)	816,000		2,157,496		—		—		—		—
Weighted average price ($/Bbl)	$	100.08	$	94.44	$	—	$	—	$	—	$	—
Collars:
Hedged volume (Bbl)	192,000		726,000		2,219,500		1,860,000		—		—
Weighted average floor price ($/Bbl)	$	79.38	$	75.45	$	79.43	$	80.00	$	—	$	—
Weighted average ceiling price ($/Bbl)	$	121.67	$	129.09	$	101.83	$	91.37	$	—	$	—
Basis swaps:
Hedged volume⁽¹⁾ (Bbl)	736,000		2,252,000		—		—		—		—
Weighted average price⁽¹⁾ ($/Bbl)	$	1.40	$	1.04	$	—	$	—	$	—	$	—
Hedged volume⁽²⁾ (Bbl)	—		1,840,000		3,650,000		3,660,000		3,650,000		1,810,000
Weighted average price⁽²⁾ ($/Bbl)	$	—	$	2.85	$	2.85	$	2.85	$	2.85	$	2.85
Natural Gas Positions:
Puts:
Hedged volume (MMBtu)	—		—		—		—		—		—
Weighted average price ($/MMBtu)	$	—	$	—	$	—	$	—	$	—	$	—
Swaps:
Hedged volume (MMBtu)	—		—		—		—		—		—
Weighted average price ($/MMBtu)	$	—	$	—	$	—	$	—	$	—	$	—
Collars:
Hedged volume (MMBtu)	3,160,000		9,600,000		8,160,000		—		—		—
Weighted average floor price ($/MMBtu)	$	3.01	$	3.00	$	3.00	$	—	$	—	$	—
Weighted average ceiling price ($/MMBtu)	$	4.69	$	5.50	$	6.00	$	—	$	—	$	—
Basis swaps:⁽³⁾
Hedged volume (MMBtu)	300,000		—		—		—		—		—
Weighted average price ($/MMBtu)	$	0.33	$	—	$	—	$	—	$	—	$	—

_______________________________________________________________________________


(1)	The associated oil basis swap derivatives are settled based on the differential between the Midland oil futures and the WTI Argus index oil price.


(2)	The associated oil basis swap derivatives are settled based on the differential between the Brent oil price and the LLS Argus index gas price.


(3)	The cash settlement price of the Company's natural gas basis swaps is calculated on the difference between the Company's natural gas futures contracts that settle on the NYMEX index and the NYMEX index price at the time of settlement. At September 30, 2013, the Company had 80,000 MMBtu for 2013 in basis swaps that did not have corresponding volumes hedged with a NYMEX index price.

Schedule of gains and losses on derivative instruments

The following represents cash settlements on matured derivative financial instruments for the periods presented:



	Three months ended September 30,						Nine months ended September 30,
(in thousands)	2013			2012			2013			2012
Commodity derivatives (paid) received	$	(3,975	)	$	7,078		$	888		$	20,901
Interest rate derivatives paid	(94		)	(84		)	(300		)	(2,022		)
Cash settlements on matured derivative financial instruments (paid) received	$	(4,069	)	$	6,994		$	588		$	18,879

Summary of derivatives outstanding on a gross basis

The following summarizes the fair value of derivatives outstanding on a gross basis as of:



(in thousands)	September 30, 2013		December 31, 2012
Assets:
Commodity derivatives:
Oil derivatives	$	41,142	$	16,219
Natural gas derivatives	1,343		17,896
Total assets	$	42,485	$	34,115

Liabilities:
Commodity derivatives:
Oil derivatives⁽¹⁾	$	38,872	$	21,308
Natural gas derivatives⁽²⁾	2,646		10,413
Interest rate derivatives	—		277
Total liabilities	$	41,518	$	31,998

Net derivative position	$	967	$	2,117

______________________________________________________________________________

(1) The oil derivatives fair value includes a deferred premium liability of $13.0 million and $18.3 million as of September 30, 2013 and December 31, 2012, respectively.

(2) The natural gas derivatives fair value includes a deferred premium liability of $1.9 million and $6.4 million as of September 30, 2013 and December 31, 2012, respectively.

Schedule of fair value hierarchy for assets and liabilities measured at fair value on a recurring basis

Tabular disclosure of pertinent information about a derivative or group of derivatives on a disaggregated basis, such as for individual instruments, or small groups of similar instruments. May include a combination of the type of instrument, risks being hedged, notional amount, hedge designation, related hedged item, inception date, maturity date, or other relevant item.

+ References

Reference 1: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 815
-SubTopic 10
-Section 50
-Paragraph 5
-URI http://asc.fasb.org/extlink&oid=7476318&loc=d3e41641-113959

Reference 2: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 815
-SubTopic 10
-Section 50
-Paragraph 4B
-URI http://asc.fasb.org/extlink&oid=7476318&loc=SL5624163-113959

Reference 3: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 815
-SubTopic 10
-Section 50
-Paragraph 8
-URI http://asc.fasb.org/extlink&oid=7476318&loc=d3e41678-113959

Reference 4: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 815
-SubTopic 10
-Section 50
-Paragraph 4
-URI http://asc.fasb.org/extlink&oid=7476318&loc=d3e41638-113959

Reference 5: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 815
-SubTopic 10
-Section 50
-Paragraph 1B
-URI http://asc.fasb.org/extlink&oid=7476318&loc=SL5580258-113959

Reference 6: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 815
-SubTopic 10
-Section 50
-Paragraph 1A
-URI http://asc.fasb.org/extlink&oid=7476318&loc=SL5579245-113959

Reference 7: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 815
-SubTopic 10
-Section 50
-Paragraph 4C
-URI http://asc.fasb.org/extlink&oid=7476318&loc=SL5624171-113959

Reference 8: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 815
-SubTopic 25
-Section 50
-Paragraph 1
-URI http://asc.fasb.org/extlink&oid=6886632&loc=d3e76258-113986

Reference 9: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 815
-SubTopic 10
-Section 50
-Paragraph 1
-URI http://asc.fasb.org/extlink&oid=7476318&loc=SL5579240-113959

Reference 10: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 815
-SubTopic 10
-Section 50
-Paragraph 2
-URI http://asc.fasb.org/extlink&oid=7476318&loc=d3e41620-113959

Reference 11: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 235
-SubTopic 10
-Section S99
-Paragraph 1
-Subparagraph (SX 210.4-08.(n)(2))
-URI http://asc.fasb.org/extlink&oid=26873400&loc=d3e23780-122690

+ Details

Fair value measurements (Tables)

9 Months Ended

Sep. 30, 2013

Fair Value Disclosures [Abstract]

The following presents the Company’s fair value hierarchy for assets and liabilities measured at fair value on a recurring basis for the periods presented:



(in thousands)	Level 1		Level 2		Level 3			Total fair value
As of September 30, 2013:
Commodity derivatives	$	—	$	15,930	$	—		$	15,930
Deferred premiums	—		—		(14,963		)	(14,963		)
Interest rate derivatives	—		—		—			—
Total	$	—	$	15,930	$	(14,963	)	$	967



(in thousands)	Level 1		Level 2			Level 3			Total fair value
As of December 31, 2012:
Commodity derivatives	$	—	$	27,103		$	—		$	27,103
Deferred premiums	—		—			(24,709		)	(24,709		)
Interest rate derivatives	—		(277		)	—			(277		)
Total	$	—	$	26,826		$	(24,709	)	$	2,117

Actual cash payments required for deferred premium contracts

The following table presents actual cash payments required for deferred premium contracts in place as of September 30, 2013, and for the calendar years following:



(in thousands)
Remaining 2013	$	2,357
2014	7,419
2015	5,166
2016	358
Total	$	15,300

Summary of changes in assets classified as Level 3 measurements

A summary of the changes in assets classified as Level 3 measurements for the periods presented are as follows:



	Three months ended September 30,						Nine months ended September 30,
(in thousands)	2013			2012			2013			2012
Balance of Level 3 at beginning of period	$	(19,742	)	$	(23,552	)	$	(24,709	)	$	(18,868	)
Change in net present value of deferred premiums for derivative financial instruments	(102		)	(176		)	(384		)	(495		)
Total purchases and settlements:
Purchases	—			(3,999		)	—			(11,291		)
Settlements⁽¹⁾	4,881			1,595			10,130			4,522
Balance of Level 3 at end of period	$	(14,963	)	$	(26,132	)	$	(14,963	)	$	(26,132	)

______________________________________________________________________________

Commitments and contingencies (Tables)

9 Months Ended

Sep. 30, 2013

Commitments and Contingencies Disclosure [Abstract]

Schedule of minimum annual lease commitments

Minimum annual lease commitments as of September 30, 2013 and for the calendar years following are as follows:



(in thousands)
Remaining 2013	$	487
2014	1,994
2015	2,088
2016	1,923
2017	1,823
Thereafter	3,105
Total	$	11,420

Schedule of rent expense

The following table presents rent expense for the periods presented:



	Three months ended September 30,				Nine months ended September 30,
(in thousands)	2013		2012		2013		2012
Rent expense	$	499	$	333	$	1,423	$	935

Net income (loss) per share (Tables)

9 Months Ended

Sep. 30, 2013

Earnings Per Share [Abstract]

Schedule of calculation of basic and diluted weighted average shares outstanding and net income per share

The following is the calculation of basic and diluted weighted average shares outstanding and net income (loss) per share for the periods presented:



	Three months ended September 30,					Nine months ended September 30,
(in thousands, except for per share data)	2013		2012			2013		2012
Net income (loss) (numerator):
Income (loss) from continuing operations—basic and diluted	$	11,817	$	(7,271	)	$	48,248	$	49,889
Income (loss) from discontinued operations—basic and diluted	726		(113		)	1,516		(63		)
Net income (loss)—basic and diluted	$	12,543	$	(7,384	)	$	49,764	$	49,826
Weighted average shares (denominator):
Weighted average shares—basic	134,461		127,001			129,701		126,909
Non-vested restricted stock⁽¹⁾	1,999		—			1,888		1,239
Weighted average shares—diluted	136,460		127,001			131,589		128,148
Net income (loss) per share:
Basic:
Income (loss) from continuing operations	$	0.09	$	(0.06	)	$	0.37	$	0.39
Income (loss) from discontinued operations, net of tax	—		—			0.01		—
Net income (loss) per share	$	0.09	$	(0.06	)	$	0.38	$	0.39

Diluted:
Income (loss) from continuing operations	$	0.09	$	(0.06	)	$	0.37	$	0.39
Income (loss) from discontinued operations, net of tax	—		—			0.01		—
Net income (loss) per share	$	0.09	$	(0.06	)	$	0.38	$	0.39

______________________________________________________________________________

Subsidiary guarantees (Tables)

9 Months Ended

Sep. 30, 2013

Condensed Financial Information of Parent Company Only Disclosure [Abstract]

Schedule of condensed consolidating balance sheet

Condensed consolidating balance sheet

September 30, 2013

(Unaudited)



(in thousands)	Laredo Holdings		Laredo		Subsidiary Guarantors		Intercompany eliminations			Consolidated company
Accounts receivable	$	—	$	47,091	$	30,685	$	—		$	77,776
Other current assets	—		271,203		3,868		—			275,071
Oil and natural gas properties, net	—		993,877		1,003,555		—			1,997,432
Pipeline and gas gathering assets, net	—		—		32,888		—			32,888
Other fixed assets, net	—		20,999		5,050		—			26,049
Investment in subsidiaries	1,195,127		936,752		—		(2,131,879		)	—
Total other long-term assets	226		128,061		3,221		(60,563		)	70,945
Total assets	$	1,195,353	$	2,397,983	$	1,079,267	$	(2,192,442	)	$	2,480,161
Accounts payable	$	1	$	23,414	$	7,444	$	—		$	30,859
Other current liabilities	—		112,496		64,445		—			176,941
Other long-term liabilities	—		15,351		70,626		(60,563		)	25,414
Long-term debt	—		1,051,595		—		—			1,051,595
Stockholders’ equity	1,195,352		1,195,127		936,752		(2,131,879		)	1,195,352
Total liabilities and stockholders’ equity	$	1,195,353	$	2,397,983	$	1,079,267	$	(2,192,442	)	$	2,480,161

Condensed consolidating balance sheet

December 31, 2012

(Unaudited)



(in thousands)	Laredo Holdings		Laredo		Subsidiary Guarantors		Intercompany eliminations			Consolidated company
Accounts receivable	$	—	$	59,447	$	24,393	$	—		$	83,840
Other current assets	—		52,147		1,450		—			53,597
Oil and natural gas properties, net	—		1,213,946		817,992		—			2,031,938
Pipeline and gas gathering assets, net	—		—		65,292		—			65,292
Other fixed assets, net	—		13,837		2,824		—			16,661
Investment in subsidiaries	831,641		782,635		—		(1,614,276		)	—
Total other long-term assets	83		136,403		—		(49,510		)	86,976
Total assets	$	831,724	$	2,258,415	$	911,951	$	(1,663,786	)	$	2,338,304
Accounts payable	$	1	$	35,948	$	12,723	$	—		$	48,672
Other current liabilities	—		157,805		55,591		—			213,396
Other long-term liabilities	—		16,261		61,002		(49,510		)	27,753
Long-term debt	—		1,216,760		—		—			1,216,760
Stockholders’ equity	831,723		831,641		782,635		(1,614,276		)	831,723
Total liabilities and stockholders’ equity	$	831,724	$	2,258,415	$	911,951	$	(1,663,786	)	$	2,338,304

Schedule of condensed consolidating statement of operations

Condensed consolidating statement of operations

For the three months ended September 30, 2013

(Unaudited)



(in thousands)	Laredo Holdings			Laredo			Subsidiary Guarantors		Intercompany eliminations			Consolidated company
Total operating revenues	$	—		$	76,952		$	96,131	$	(2,243	)	$	170,840
Total operating costs and expenses	42			69,880			45,741		(2,243		)	113,420
Income (loss) from operations	(42		)	7,072			50,390		—			57,420
Interest expense, net	—			(24,870		)	—		—			(24,870		)
Other, net	12,561			(15,291		)	4,606		(12,561		)	(10,685		)
Income (loss) from continuing operations before income tax	12,519			(33,089		)	54,996		(12,561		)	21,865
Income tax (expense) benefit	24			(25,749		)	15,677		—			(10,048		)
Income (loss) from continuing operations	12,543			(58,838		)	70,673		(12,561		)	11,817
Income from discontinued operations, net of tax	—			346			380		—			726
Net income (loss)	$	12,543		$	(58,492	)	$	71,053	$	(12,561	)	$	12,543

Condensed consolidating statement of operations

For the three months ended September 30, 2012

(Unaudited)



(in thousands)	Laredo Holdings			Laredo			Subsidiary Guarantors			Intercompany eliminations			Consolidated company
Total operating revenues	$	—		$	75,179		$	71,411		$	(2,755	)	$	143,835
Total operating costs and expenses	12			69,435			39,937			(2,755		)	106,629
Income (loss) from operations	(12		)	5,744			31,474			—			37,206
Interest expense, net	—			(24,410		)	—			—			(24,410		)
Other, net	(7,376		)	(24,156		)	(1		)	7,376			(24,157		)
Income (loss) from continuing operations before income tax	(7,388		)	(42,822		)	31,473			7,376			(11,361		)
Income tax (expense) benefit	4			2,821			1,265			—			4,090
Income (loss) from continuing operations	(7,384		)	(40,001		)	32,738			7,376			(7,271		)
Loss from discontinued operations, net of tax	—			(63		)	(50		)	—			(113		)
Net income (loss)	$	(7,384	)	$	(40,064	)	$	32,688		$	7,376		$	(7,384	)

Condensed consolidating statement of operations

For the nine months ended September 30, 2013

(Unaudited)



(in thousands)	Laredo Holdings			Laredo			Subsidiary Guarantors			Intercompany eliminations			Consolidated company
Total operating revenues	$	—		$	249,775		$	269,637		$	(7,571	)	$	511,841
Total operating costs and expenses	358			220,564			139,151			(7,571		)	352,502
Income (loss) from operations	(358		)	29,211			130,486			—			159,339
Interest expense, net	—			(76,135		)	—			—			(76,135		)
Other, net	49,987			(8,244		)	4,493			(49,987		)	(3,751		)
Income (loss) from continuing operations before income tax	49,629			(55,168		)	134,979			(49,987		)	79,453
Income tax (expense) benefit	135			(21,403		)	(9,937		)	—			(31,205		)
Income (loss) from continuing operations	49,764			(76,571		)	125,042			(49,987		)	48,248
Income from discontinued operations, net of tax	—			11			1,505			—			1,516
Net income (loss)	$	49,764		$	(76,560	)	$	126,547		$	(49,987	)	$	49,764

Condensed consolidating statement of operations

For the nine months ended September 30, 2012

(Unaudited)



(in thousands)	Laredo Holdings			Laredo			Subsidiary Guarantors			Intercompany eliminations			Consolidated company
Total operating revenues	$	—		$	227,637		$	212,569		$	(7,644	)	$	432,562
Total operating costs and expenses	171			195,625			110,370			(7,644		)	298,522
Income (loss) from operations	(171		)	32,012			102,199			—			134,040
Interest expense, net	—			(60,737		)	—			—			(60,737		)
Other, net	49,937			4,658			(9		)	(49,937		)	4,649
Income (loss) from continuing operations before income tax	49,766			(24,067		)	102,190			(49,937		)	77,952
Income tax (expense) benefit	60			(8,038		)	(20,085		)	—			(28,063		)
Income (loss) from continuing operations	49,826			(32,105		)	82,105			(49,937		)	49,889
Income (loss) from discontinued operations, net of tax	—			(303		)	240			—			(63		)
Net income (loss)	$	49,826		$	(32,408	)	$	82,345		$	(49,937	)	$	49,826

Schedule of condensed consolidating statement of cash flows

Condensed consolidating statement of cash flows

For the nine months ended September 30, 2013

(Unaudited)



(in thousands)	Laredo Holdings			Laredo			Subsidiary Guarantors			Intercompany eliminations			Consolidated company
Net cash flows provided by operating activities	$	49,621		$	71,033		$	204,770		$	(49,986	)	$	275,438
Net cash flows (used in) provided by investing activities	(348,380		)	328,206			(204,770		)	49,986			(174,958		)
Net cash flows provided by (used in) financing activities	298,759			(167,193		)	—			—			131,566
Net increase in cash and cash equivalents	—			232,046			—			—			232,046
Cash and cash equivalents at beginning of period	—			33,224			—			—			33,224
Cash and cash equivalents at end of period	$	—		$	265,270		$	—		$	—		$	265,270

Condensed consolidating statement of cash flows

For the nine months ended September 30, 2012

(Unaudited)



(in thousands)	Laredo Holdings			Laredo			Subsidiary Guarantors			Intercompany eliminations			Consolidated company
Net cash flows provided by operating activities	$	49,766		$	79,884		$	176,822		$	(23,015	)	$	283,457
Net cash flows used in investing activities	(104,687		)	(505,291		)	(176,825		)	49,937			(736,866		)
Net cash flows provided by financing activities	—			454,524			—			—			454,524
Net increase (decrease) in cash and cash equivalents	(54,921		)	29,117			(3		)	26,922			1,115
Cash and cash equivalents at beginning of period	54,921			—			3			(26,922		)	28,002
Cash and cash equivalents at end of period	$	—		$	29,117		$	—		$	—		$	29,117

Supplementary information (Tables)

9 Months Ended

Sep. 30, 2013

Supplemental Information Disclosure Abstract

Schedule of costs incurred in the development of oil and natural gas properties

Costs incurred in the acquisition, exploration and development of oil and natural gas assets are presented below for the periods presented:



	Three months ended September 30,				Nine months ended September 30,
(in thousands)	2013		2012		2013		2012
Property acquisition costs:
Proved	$	9,652	$	16,925	$	9,652	$	16,925
Unproved	27,087		3,693		27,087		3,693
Exploration	8,317		13,911		29,245		65,597
Development costs⁽¹⁾	148,877		215,227		471,609		642,826
Total costs incurred	$	193,933	$	249,756	$	537,593	$	729,041

____________________________________________________________________________


(1)	The costs incurred for oil and natural gas development activities include $0.7 million and $1.1 million in asset retirement obligations for the three months ended September 30, 2013 and 2012, respectively, and $2.0 million and $3.4 million for the nine months ended September 30, 2013 and 2012, respectively.

Organization (Details) - USD ($) $ / shares in Units, $ in Thousands			9 Months Ended
	Aug. 27, 2013	Aug. 19, 2013	Sep. 30, 2013	Sep. 30, 2012
Class of Stock [Line Items]
Proceeds from issuance of common stock, net of offering costs		$ 298,100	$ 298,104	$ 0
Common Stock
Class of Stock [Line Items]
Equity issuance (in shares)		13,000,000
Sale of stock by selling shareholders (in shares)	1,577,583	3,000,000
Share price in follow-on offering (in dollars per share)		$ 23.75
Share price in follow-on offering, net of underwriting discount (in dollars per share)		$ 22.9781

Basis of presentation and significant accounting policies - Current assets and liabilities (Details) $ in Thousands	9 Months Ended
	Sep. 30, 2013 USD ($) segment	Dec. 31, 2012 USD ($)
Basis of presentation
Number of operating segments \| segment	1
Accounts receivable
Term of accounts receivable to be considered as past due (in days)	30 days
Term of past due balances to be reviewed individually for collectability (in days)	90 days
Oil and natural gas sales	$ 53,028	$ 48,445
Joint operations, net	24,112	30,925
Other	636	4,470
Total	77,776	83,840
Allowance for doubtful accounts of accounts receivable for joint operations	700	100
Other current liabilities
Lease operating expense payable	9,630	9,766
Production taxes payable	2,556	2,121
Prepaid drilling liability	95	2,916
Current portion of asset retirement obligations	275	385
Other accrued liabilities	6,115	2,782
Total other current liabilities	$ 18,671	$ 17,970

Basis of presentation and significant accounting policies - Property and equipment (Details) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2013 USD ($) $ / Boe	Sep. 30, 2012 $ / Boe	Sep. 30, 2013 USD ($) $ / Boe	Sep. 30, 2012 $ / Boe	Dec. 31, 2012 USD ($)
Property, Plant and Equipment [Line Items]
Proved properties	$ 3,099,194		$ 3,099,194		$ 2,993,266
Less accumulated depletion and impairment	1,303,812		1,303,812		1,121,274
Proved oil and natural gas properties, net	1,795,382		1,795,382		1,871,992
Unproved properties not being amortized	202,050		202,050		159,946
Pipeline and gas gathering assets	35,193		35,193		74,877
Net property and equipment	2,056,369		2,056,369		2,113,891
Other fixed assets	$ 37,477		$ 37,477		25,599
Depletion expense in dollars per BOE \| $ / Boe	20.83	21.94	20.36	20.80
Pipeline and gas gathering assets
Property, Plant and Equipment [Line Items]
Less accumulated depreciation and amortization	$ 2,305		$ 2,305		9,585
Net property and equipment	32,888		32,888		65,292
Other fixed assets
Property, Plant and Equipment [Line Items]
Less accumulated depreciation and amortization	11,428		11,428		8,938
Net property and equipment	$ 26,049		$ 26,049		$ 16,661

Basis of presentation and significant accounting policies - Asset acquisition (Details) - USD ($)
$ / shares in Units, $ in Thousands

9 Months Ended

Sep. 06, 2013

Sep. 30, 2013

Business Combination, Consideration Transferred [Abstract]

Number of shares issued

124,000

Proved and Unproved Oil and Natural Gas Properties in Glasscock County Texas [Member]

Fair value of net assets:

Proved oil and natural gas properties

^[1]

$ 9,652

Unproved oil and natural gas properties

^[1]

27,087

Other assets

200

Total assets acquired

36,939

Liabilities assumed

(200)

Net assets acquired

36,739

Business Combination, Consideration Transferred [Abstract]

Cash consideration

34,000

Common stock issued

^[2]

3,029

Closing cost adjustments

(290)

Total consideration paid for net assets

$ 36,739

Number of shares issued

123,803

Closing price per share

$ 26.21

Level 3 | Proved and Unproved Oil and Natural Gas Properties in Glasscock County Texas [Member]

Business Combination, Consideration Transferred [Abstract]

Lack of marketability discount to share price, percent

6.64%

[1]

The fair value of the oil and natural gas properties acquired was determined using a discounted cash flow model, with future cash flows estimated based upon market assumptions of oil and natural gas prices, projections of estimated oil and natural gas reserve quantities, expectations for timing of future development and operating costs, and projections of future rates of production. The commodity prices utilized were based upon commodity strip prices as of September 6, 2013, and were adjusted for transportation fees and regional price differentials. Future cash flows were discounted using a peer group weighted average cost of capital rate. These assumptions represent Level 3 inputs under the fair value hierarchy, as described in Note G.

[2]

In accordance with the acquisition agreement, on September 6, 2013, Laredo Holdings issued 123,803 restricted shares of its common stock to the sellers (the "Acquisition Shares"). Subject to federal securities laws, the Acquisition Shares are restricted from trading on public markets for six months from the acquisition date. For accounting purposes, the fair value of the Acquisition Shares was determined in accordance with GAAP by adjusting the closing price of $26.21 per share of Laredo Holdings' common stock on September 6, 2013 for a discount for lack of marketability. The discount of 6.64% was determined utilizing an Asian put option model, which includes an assumption of the estimated volatility of Laredo Holdings' common stock. This assumption represents a Level 3 input under the fair value hierarchy, as described in Note G.

Basis of presentation and significant accounting policies - Divestitures (Details) - USD ($) $ in Thousands		3 Months Ended		9 Months Ended
	Aug. 01, 2013	Sep. 30, 2013	Sep. 30, 2012	Sep. 30, 2013	Sep. 30, 2012
Revenues:
Natural gas transportation and treating		$ 761	$ 865	$ 4,071	$ 3,110
Total revenues from discontinued operations		761	865	4,071	3,110
Cost and expenses:
Natural gas transportation and treating		211	330	1,180	964
Drilling and production		(497)	53	(17)	338
Depreciation, depletion and amortization		0	659	627	1,907
Total costs and expenses from discontinued operations		(286)	1,042	1,790	3,209
Income (loss) from discontinued operations before income tax		1,047	(177)	2,281	(99)
Income tax (expense) benefit		(321)	64	(765)	36
Income (loss) from discontinued operations		726	(113)	1,516	(63)
Andarko Basin
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Consideration net of transaction costs	$ 427,900
Revenues:
Total revenues from discontinued operations		11,429	19,915	61,166	64,829
Cost and expenses:
Direct operating expenses		$ 9,283	$ 24,440	$ 50,120	$ 67,804
Andarko Basin \| EnerVest [Member]
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Total consideration from asset divestiture	400,000
Andarko Basin \| Other Third Parties [Member]
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Total consideration from asset divestiture	38,000
Pipeline and Gas Gathering Assets [Member] \| Andarko Basin
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Total consideration from asset divestiture	$ 388,000

Basis of presentation and significant accounting policies - Deferred loan costs and asset retirement obligations (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended		12 Months Ended
	Sep. 30, 2013	Sep. 30, 2012	Sep. 30, 2013	Sep. 30, 2012	Dec. 31, 2012
Deferred loan costs
Capitalization of deferred loan costs			$ 714	$ 10,476
Deferred loan costs, net	$ 24,750		24,750		$ 29,444
Accumulated amortization	13,100		13,100		9,200
Write-off of deferred loan costs	1,502	$ 0	1,502	0
Future amortization expense of deferred loan costs
Remaining 2013	1,241		1,241
2014	5,004		5,004
2015	5,066		5,066
2016	3,771		3,771
2017	2,725		2,725
Thereafter	6,943		6,943
Total	24,750		24,750		29,444
Reconciliation of asset retirement obligations liability
Liability at beginning of year			21,505	13,074	13,074
Liabilities added due to acquisitions, drilling, and other			1,978		4,233
Accretion expense	350	$ 315	1,154	$ 871	1,200
Liabilities settled upon plugging and abandonment			(216)		(148)
Liabilities extinguished due to Andarko Basin Sale			(7,801)		0
Revision of estimates	0				3,146
Liability at end of year	$ 16,620		$ 16,620		$ 21,505

Basis of presentation and significant accounting policies - Related-party (Details) - Targa Resources Inc - Warburg Pincus Private Equity IX, LP - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2013	Sep. 30, 2012	Sep. 30, 2013	Sep. 30, 2012	Dec. 31, 2012
Related Party Transaction [Line Items]
Net oil and natural gas sales	$ 20,358	$ 15,940	$ 58,146	$ 53,680
Oil and natural gas sales receivable	$ 8,078		$ 8,078		$ 6,244

For an unclassified balance sheet, amount of receivables arising from transactions with related parties.

+ References + Details

Basis of presentation and significant accounting policies - Supplemental cash flow information (Details) - USD ($) $ in Thousands	9 Months Ended
	Sep. 30, 2013	Sep. 30, 2012
Accounting Policies [Abstract]
Cash paid for interest, net of $255 and $567 of capitalized interest, respectively	$ 74,932	$ 54,809
Capitalized interest	255	567
Change in accrued capital expenditures	(41,001)	6,774
Capitalized asset retirement cost	1,978	3,407
Common stock issued in connection with acquisition	$ 3,029	$ 0

Debt - Interest expense and details of debt outstanding (Details) - USD ($)			1 Months Ended	3 Months Ended		9 Months Ended
	Apr. 27, 2012	Jan. 20, 2011	Oct. 31, 2011	Sep. 30, 2013	Sep. 30, 2012	Sep. 30, 2013	Sep. 30, 2012	Nov. 04, 2013
Debt Disclosure [Abstract]
Cash payments for interest				$ 26,627,000	$ 26,915,000	$ 75,187,000	$ 55,376,000
Change in net present value of deferred premiums for derivative financial instruments				102,000	176,000	384,000	495,000
Amortization and write-off of deferred loan costs and other adjustments				2,634,000	1,127,000	4,976,000	3,129,000
Change in accrued interest				(4,391,000)	(3,733,000)	(4,071,000)	2,348,000
Interest costs incurred				24,972,000	24,485,000	76,476,000	61,348,000
Less capitalized interest				(43,000)	(62,000)	(255,000)	(567,000)
Total interest expense				$ 24,929,000	$ 24,423,000	$ 76,221,000	$ 60,781,000
2022 Notes
Debt
Debt issued	$ 500,000,000.0
Interest rate (as a percent)				7.375%		7.375%
2019 Notes
Debt
Interest rate (as a percent)				9.50%		9.50%
January Notes
Debt
Debt issued		$ 350,000,000.0
October Notes
Debt
Debt issued			$ 200,000,000.0
Senior Secured Credit Facility
Debt
Borrowing capacity				$ 825,000,000		$ 825,000,000
Outstanding amount				0		0
Letters of credit
Debt
Borrowing capacity				$ 20,000,000		$ 20,000,000
Subsequent events \| Senior Secured Credit Facility
Debt
Borrowing capacity								$ 925,000,000

Debt - Fair value of debt (Details) - USD ($)
$ in Thousands

Sep. 30, 2013

Dec. 31, 2012

October Notes

Unamortized bond premium

$ 1,600

$ 1,800

Carrying value

Carrying value | 2019 Notes

1,051,595

1,216,760

Carrying value | 2022 Notes

^[1]

551,595

551,760

Carrying value | Senior Secured Credit Facility

500,000

165,000

Fair value

1,147,125

1,322,348

Fair value | 2019 Notes

^[1]

614,625

616,000

Fair value | 2022 Notes

Fair value | Senior Secured Credit Facility

532,500

541,250

$ 0

$ 165,098

[1]	The carrying value of the 2019 Notes includes the October 2011 Notes unamortized bond premium of approximately $1.6 million and $1.8 million as of September 30, 2013 and December 31, 2012, respectively.

Employee compensation (Details)
$ / shares in Units, shares in Thousands, $ in Thousands

3 Months Ended

9 Months Ended

Sep. 30, 2013

USD ($)

$ / shares

Sep. 30, 2012

USD ($)

Sep. 30, 2013

USD ($)

anniversaries

installments

$ / shares

Sep. 30, 2012

USD ($)

Sep. 30, 2013

$ / shares

Dec. 31, 2012

Nov. 30, 2011

Percentage of awards vesting at the grant date

20.00%

Percentage of awards vesting annually after the grant date

20.00%

Tax deficiency related to vested stock awards | $

$ 100

$ 500

Tax-deferred contributions of eligible employees as a percentage of their annual compensation

100.00%

Employer matching contribution, percent

6.00%

Percentage of employer contributions vested upon receipt

100.00%

Contributions to 401(k) plan | $

$ 501

$ 321

$ 1,382

$ 963

Long-Term Incentive Plan

Shares available for issuance | shares

10,000

Restricted Stock Awards

Tax deficiency related to vested stock awards | $

$ 400

Restricted stock awards

Outstanding at the beginning of the period (in shares) | shares

1,195

Granted (in shares) | shares

1,445

Forfeited (in shares) | shares

(192)

Vested (in shares) | shares

^[1]

(507)

Outstanding at the end of the period (in shares) | shares

1,941

Weighted-average grant date fair value

Outstanding at the beginning of the period (in dollars per share) | $ / shares

$ 15.06

Granted (in dollars per share) | $ / shares

17.95

Forfeited (in dollars per share) | $ / shares

18.60

Vested (in dollars per share) | $ / shares

^[1]

18.80

Outstanding at the end of the period (in dollars per share) | $ / shares

$ 18.94

Restricted Stock Awards | Long-Term Incentive Plan

Percentage of awards vesting on the first anniversary date of the grant

33.00%

Percentage of awards vesting on the second anniversary date of the grant

33.00%

Percentage of awards vesting on the third anniversary date of the grant

34.00%

Number of installments over which awards vest and are exercisable | installments

Number of anniversaries over which awards vest and are exercisable | anniversaries

Restricted stock option awards

Tax deficiency related to vested stock awards | $

$ 100

Tax expense from exercise of stock options | $

$ 100

Requisite service period of the awards

4 years

Restricted stock option awards

Outstanding at the beginning of the period (in shares) | shares

459

Granted (in shares) | shares

1,019

Exercised (in shares) | shares

^[2]

(34)

Expired or canceled (in shares) | shares

(12)

Forfeited (in shares) | shares

(112)

Outstanding at the end of the period (in shares) | shares

1,320

Vested and exercisable at end of period (in shares) | shares

107

Weighted-average exercise price (per option)

Outstanding at the beginning of the period (in dollars per share) | $ / shares

$ 24.11

Granted (in dollars per share) | $ / shares

17.46

Exercised (in dollars per share) | $ / shares

^[2]

22.83

Expired or cancelled (in dollars per share) | $ / shares

24.11

Forfeited (in dollars per share) | $ / shares

19.96

Outstanding at end of the period (in dollars per share) | $ / shares

$ 19.35

Exercisable, weighted average exercise price (in dollars per share) | $ / shares

$ 24.11

Weighted-average contractual term

Outstanding at the beginning of the period

9 years 1 month 6 days

Granted

9 years 4 months 24 days

Exercised

^[2]

9 years

Expired or cancelled

8 years 3 months 18 days

Outstanding at the end of the period

9 years 1 month 6 days

Vested and exercisable at the end of the period

8 years 3 months 18 days

Assumptions used to estimate the fair value of options granted

Risk-free interest rate (as a percent)

^[3]

1.19%

Expected option life

^[4]

6 years 3 months

Expected volatility (as a percent)

^[5]

58.89%

Fair value per option (in dollars per share) | $ / shares

$ 9.67

Performance Shares

Share-based compensation expense | $

$ 2,800

$ 500

$ 5,000

$ 1,500

[1]	The vesting of certain restricted stock grants could result in federal and state income tax expense or benefits related to the difference between the market price of the common stock at the date of vesting and the date of grant. The Company recognized income tax expense of $0.4 million during the nine months ended September 30, 2013 related to restricted stock, which were recorded as adjustments to deferred income taxes. There were no comparative amounts recorded in the three months ended September 30, 2013 or the three or nine months ended September 30, 2012.
[2]	The exercise of stock options could result in federal and state income tax expense or benefits related to the difference between the fair value of the stock option at the date of grant and the intrinsic value of the stock option when exercised. The Company recognized income tax expense of $0.1 million during each of the the three and nine months ended September 30, 2013, respectively, related to stock options, which were recorded as adjustments to deferred income taxes. There were no comparative amounts recorded in the three or nine months ended September 30, 2012.
[3]	U.S. Treasury yields as of the grant date were utilized for the risk-free interest rate assumption, matching the treasury yield terms to the expected life of the option.
[4]	As the Company had no exercise history at the time of valuation, expected option life assumptions were developed using the simplified method in accordance with GAAP.
[5]	The Company utilized a peer historical look-back, which was weighted with the Company’s own volatility since the IPO, in order to develop the expected volatility.

Income taxes (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
Income taxes (Details) - USD ($) $ in Thousands	Sep. 30, 2013	Sep. 30, 2012	Sep. 30, 2013	Sep. 30, 2012
Deferred taxes
Federal	$ (6,032)	$ 3,987	$ (26,322)	$ (26,832)
State	(4,016)	103	(4,883)	(1,231)
Total income tax expense	(10,048)	4,090	$ (31,205)	(28,063)
Federal income tax rate (as a percent)			34.00%
Reconciliation of income tax (expense) benefit computed by applying the federal income tax rate to pre-tax loss from operations
Income tax (benefit) expense computed by applying the statutory rate	(7,434)	3,862	$ (27,014)	(26,504)
State income tax, net of federal tax benefit and increase in valuation allowance	(2,651)	1,380	(3,223)	(517)
Non-deductible stock-based compensation	(156)	(341)	(495)	(996)
Income Tax Reconciliation Stock-Based Compensation Tax Deficiency	(72)	0	(483)	0
Change in deferred tax valuation allowance	(20)	(20)	(49)	(22)
Other items	285	(791)	59	(24)
Total income tax expense	$ (10,048)	$ 4,090	$ (31,205)	$ (28,063)

Income taxes (Details 1) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
Income taxes (Details 1) - USD ($) $ in Thousands	Sep. 30, 2013	Sep. 30, 2012	Sep. 30, 2013	Sep. 30, 2012
Income Tax Disclosure [Abstract]
Continuing operations	$ (10,048)	$ 4,090	$ (31,205)	$ (28,063)
Discontinued operations	(321)	64	(765)	36
Comprehensive provision for income taxes	$ (10,369)	$ 4,154	$ (31,970)	$ (28,027)

Income taxes (Details 2) - USD ($) $ in Thousands	Sep. 30, 2013	Dec. 31, 2012
Significant components of deferred tax assets
Derivative financial instruments	$ (2,284)	$ 7,108
Oil and natural gas properties and equipment	(247,745)	(175,823)
Net operating loss carry-forward	268,940	222,017
Accrued bonus	1,959	3,502
Stock-based compensation	6,095	2,928
Capitalized interest	2,104	1,850
Other	1,707	1,113
Gross deferred tax assets	30,776	62,695
Valuation allowance	(117)	(66)
Net deferred tax assets	30,659	62,629
Net deferred tax assets and liabilities
Deferred tax asset	30,659	62,629
Deferred tax liability	0	0
Net deferred tax assets	$ 30,659	$ 62,629

Income taxes (Details 3) $ in Millions	Sep. 30, 2013 USD ($)
Federal
Operating loss carry-forward
Net operating loss carry-forwards	$ 771.3
State
Operating loss carry-forward
Net operating loss carry-forwards	179.6
Charitable Contribution Carryforward [Member]
Operating loss carry-forward
Net operating loss carry-forwards	$ 0.3

Income taxes (Details 4) - USD ($) $ in Thousands	Sep. 30, 2013	Dec. 31, 2012
Valuation allowance
Valuation allowance	$ 117	$ 66
Charitable contribution carry-forward
Valuation allowance
Valuation allowance	$ 100

Income taxes Income taxes (Details 5) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2013	Sep. 30, 2012	Sep. 30, 2013	Sep. 30, 2012
Income Tax Examination [Line Items]
Income tax expense	$ 10,048	$ (4,090)	$ 31,205	$ 28,063
Effective tax rate, continuing operations			39.00%	36.00%
Effective tax rate, before discrete items			36.00%
Tax deficiency related to vested stock awards	100		$ 500
OKLAHOMA
Income Tax Examination [Line Items]
Income tax expense	$ 2,400		$ 2,400

Derivative financial instruments - Derivative positions (Details)

9 Months Ended

Sep. 30, 2013

bbl

MMBTU

contract

$ / MMBTU

$ / bbl

Derivatives not designated as hedges

Number of open derivative contracts | contract

Puts | Oil derivatives | October 2013 - December 2013

270,000

Puts | Oil derivatives | January 2014 - December 2014

65.00

540,000

Puts | Oil derivatives | January 2015 - December 2015

75.00

456,000

Puts | Natural gas derivatives | October 2013 - December 2013

75.00

Weighted average price (in dollars per Bbl/MMBtu) | $ / MMBTU

0.00

Swaps | Oil derivatives | March 2013 - December 2013

1,377,000

98.10

0.00

Swaps | Oil derivatives | August 2013 - December 2013

0.00

80,000

101.20

0.00

Swaps | Oil derivatives | October 2013 - December 2013

0.00

204,000

106.60

0.00

0.00

816,000

Swaps | Oil derivatives | January 2014 - December 2014

100.08

2,157,496

Swaps | Oil derivatives | Swap One | January 2014 - December 2014

94.44

912,500

93.65

0.00

Swaps | Oil derivatives | Swap Two | January 2014 - December 2014

0.00

365,000

93.68

0.00

Swaps | Oil derivatives | Swap Three | January 2014 - December 2014

0.00

399,996

93.30

0.00

Swaps | Oil derivatives | Swap Four | January 2014 - December 2014

0.00

480,000

97.47

0.00

Swaps | Natural gas derivatives | October 2013 - December 2013

0.00

Swaps | Natural gas derivatives | January 2014 - December 2014

Swaps | Natural gas derivatives | Swap One | June 2013 - December 2013

Aggregate volumes (in Bbls/MMBtu) | MMBTU

3,338,400

Swap price (in dollars per unit) | $ / MMBTU

4.31

Floor price (in dollars per unit) | $ / MMBTU

0.00

Ceiling price (in dollars per unit) | $ / MMBTU

0.00

Swaps | Natural gas derivatives | Swap Two | January 2014 - December 2014

Aggregate volumes (in Bbls/MMBtu) | MMBTU

3,978,500

Swap price (in dollars per unit) | $ / MMBTU

4.36

Floor price (in dollars per unit) | $ / MMBTU

0.00

Ceiling price (in dollars per unit) | $ / MMBTU

0.00

Basis Swaps | October 2013 - December 2013

736,000

^[1]

Basis Swaps | January 2015 - December 2015

1.40

^[1]

3,650,000

^[2]

Basis Swaps | January 2016 - December 2016

2.85

^[2]

3,660,000

^[2]

Basis Swaps | January 2017 - December 2017

2.85

^[2]

3,650,000

^[2]

Basis Swaps | January 2018 - December 2018

2.85

^[2]

1,810,000

^[2]

Basis Swaps | Swap One | January 2014 - December 2014

2.85

^[2]

2,252,000

^[1]

Basis Swaps | Swap Two | January 2014 - December 2014

1.04

^[1]

1,840,000

^[2]

Basis Swaps | Oil derivatives | March 2013 - December 2014

2.85

^[2]

4,026,000

1.00

0.00

Basis Swaps | Oil derivatives | July 2014 - June 2018

0.00

14,610,000

^[3]

2.85

^[3]

0.00

^[3]

Basis Swaps | Natural gas derivatives | October 2013 - December 2013

0.00

^[3]

Weighted average price (in dollars per Bbl/MMBtu) | $ / MMBTU

300,000

^[4]

0.33

^[4]

Basis Swaps | Natural gas derivatives | Basis Swap With No Corresponding NYMEX Hedge | October 2013 - December 2013

Collars | Oil derivatives | October 2013 - December 2013

80,000

^[4]

Weighted average floor price (in dollars per Bbl/MMBtu)

192,000

79.38

Weighted average ceiling price (in dollars per Bbl/MMBtu)

121.67

Collars | Oil derivatives | January 2014 - December 2014

Weighted average floor price (in dollars per Bbl/MMBtu)

726,000

75.45

Weighted average ceiling price (in dollars per Bbl/MMBtu)

129.09

Collars | Oil derivatives | January 2015 - December 2015

Weighted average floor price (in dollars per Bbl/MMBtu)

2,219,500

79.43

Weighted average ceiling price (in dollars per Bbl/MMBtu)

101.83

Collars | Oil derivatives | January 2016 - December 2016

Weighted average floor price (in dollars per Bbl/MMBtu)

1,860,000

80.00

Weighted average ceiling price (in dollars per Bbl/MMBtu)

91.37

Collars | Oil derivatives | Collar One | January 2015 - December 2015

1,277,500

0.00

80.00

Collars | Oil derivatives | Collar One | January 2016 - December 2016

98.50

1,281,000

0.00

80.00

Collars | Oil derivatives | Collar Two | January 2015 - December 2015

93.00

690,000

0.00

80.00

Collars | Oil derivatives | Collar Two | January 2016 - December 2016

95.87

579,000

0.00

80.00

Collars | Natural gas derivatives | March 2013 - December 2013

87.75

Aggregate volumes (in Bbls/MMBtu) | MMBTU

2,900,000

Swap price (in dollars per unit) | $ / MMBTU

0.00

Floor price (in dollars per unit) | $ / MMBTU

3.00

Ceiling price (in dollars per unit) | $ / MMBTU

4.00

Collars | Natural gas derivatives | October 2013 - December 2013

Weighted average floor price (in dollars per Bbl/MMBtu) | $ / MMBTU

3,160,000

3.01

Weighted average ceiling price (in dollars per Bbl/MMBtu) | $ / MMBTU

4.69

Collars | Natural gas derivatives | January 2014 - December 2014

Weighted average floor price (in dollars per Bbl/MMBtu) | $ / MMBTU

9,600,000

3.00

Weighted average ceiling price (in dollars per Bbl/MMBtu) | $ / MMBTU

5.50

Collars | Natural gas derivatives | January 2015 - December 2015