UNITED STATES SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-Q

(Mark one)

þ		QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended September 30, 2007

o		TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from                      to                    

RANGE RESOURCES CORPORATION

(Exact Name of Registrant as Specified in Its Charter)

Delaware		34-1312571
(State or Other Jurisdiction of Incorporation or Organization)		(IRS Employer Identification No.)
100 Throckmorton Street, Suite 1200, Fort Worth, Texas		76102
(Address of Principal Executive Offices)		(Zip Code)

Registrant’s Telephone Number, Including Area Code
(817) 870-2601

Former Name, Former Address and Former Fiscal Year, if changed since last report: Not applicable

     Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

Yes    þ  No    o

     Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer or a non-accelerated filer. See definition of “accelerated filer and large accelerated filer “in Rule 12b-2 of the Exchange Act. (Check one):

Large Accelerated Filer   þ     Accelerated Filer   o      Non-Accelerated Filer   o

     Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

Yes    o No    þ

149,193,657 Common Shares were outstanding on October 22, 2007.

 

 

RANGE RESOURCES CORPORATION
FORM 10-Q
Quarter Ended September 30, 2007

     Unless the context otherwise indicates, all references in this report to “Range” “we” “us” or “our” are to Range Resources Corporation and its subsidiaries.

TABLE OF CONTENTS

Certification by the President and CEO Pursuant to Section 302

Certification by the Chief Financial Officer Pursuant to Section 302

Certification by the President and CEO Pursuant to Section 906

Certification by the Chief Financial Officer Pursuant to Section 906

					Page
PART I – FINANCIAL INFORMATION
Item 1.		Financial Statements:
		Consolidated Balance Sheets (unaudited)			3
		Consolidated Statements of Operations (unaudited)			4
		Consolidated Statements of Cash Flows (unaudited)			5
		Consolidated Statements of Comprehensive Income (unaudited)			6
		Notes to Consolidated Financial Statements (unaudited)			7
Item 2.		Management’s Discussion and Analysis of Financial Condition and Results of Operations			21
Item 3.		Quantitative and Qualitative Disclosures about Market Risk			31
Item 4.		Controls and Procedures			33
PART II – OTHER INFORMATION
Item 6.		Exhibits			34

PART I – Financial Information

RANGE RESOURCES CORPORATION

		September 30,				December 31,
		2007				2006
Assets
Current assets:
Cash and equivalents		$	187			$	2,382
Accounts receivable, less allowance for doubtful accounts of $459 and $746			146,618				125,421
Assets held for sale			—				79,304
Assets of discontinued operation			—				78,161
Unrealized derivative gain			72,153				93,588
Inventory and other			12,102				10,069
Total current assets			231,060				388,925
Unrealized derivative gain			10,590				61,068
Equity method investments			111,735				13,618
Oil and gas properties, successful efforts method			4,286,179				3,359,093
Accumulated depletion and depreciation			(924,155	)			(751,005	)
			3,362,024				2,608,088
Transportation and field assets			99,256				80,066
Accumulated depreciation and amortization			(40,577	)			(32,923	)
			58,679				47,143
Other assets			74,338				68,832
Total assets		$	3,848,426			$	3,187,674
Liabilities
Current liabilities:
Accounts payable		$	182,483			$	171,914
Asset retirement obligation			1,251				3,853
Accrued liabilities			40,785				30,026
Liabilities of discontinued operation			—				28,333
Accrued interest			11,791				12,938
Unrealized derivative loss			7,657				4,621
Total current liabilities			243,967				251,685
Bank debt			266,000				452,000
Subordinated notes			847,062				596,782
Deferred tax, net			562,703				468,643
Unrealized derivative loss			4,967				266
Deferred compensation liability			133,962				90,094
Asset retirement obligation and other liabilities			80,953				72,043
Commitments and contingencies
Stockholders’ equity
Preferred stock, $1 par, 10,000,000 shares authorized, none issued and outstanding			—				—
Common stock, $.01 par, 250,000,000 shares authorized, 148,963,308 issued at September 30, 2007 and 138,931,565 issued at December 31, 2006			1,490				1,389
Common stock held in treasury, 155,500 shares at September 30, 2007, none at December 31, 2006 – at cost			(5,334	)			—
Additional paid-in capital			1,392,441				1,079,994
Retained earnings			343,473				160,313
Common stock held by employee benefit trust, 2,185,898 shares at September 30, 2007 and 1,853,279 shares at December 31, 2006 - at cost			(36,232	)			(22,056	)
Accumulated other comprehensive income			12,974				36,521
Total stockholders’ equity			1,708,812				1,256,161
Total liabilities and stockholders’ equity		$	3,848,426			$	3,187,674

See accompanying notes.

RANGE RESOURCES CORPORATION

		Three Months Ended								Nine Months Ended
		September 30,								September 30,
		2007				2006				2007				2006
Revenues (See Note 2)
Oil and gas sales		$	214,424			$	153,054			$	621,636			$	443,143
Transportation and gathering			508				1,015				1,203				1,933
Derivative fair value income			25,002				65,306				10,618				119,914
Other			2,419				250				5,251				3,255
Total revenues			242,353				219,625				638,708				568,245
Costs and expenses
Direct operating			28,003				22,336				78,233				57,402
Production and ad valorem taxes			11,316				9,874				32,958				27,970
Exploration			6,233				16,508				29,668				33,193
General and administrative			18,058				12,170				50,574				36,014
Deferred compensation plan			7,761				(2,638	)			28,342				(347	)
Interest expense			19,935				16,389				56,356				38,266
Depletion, depreciation and amortization			57,001				40,606				155,798				106,252
Total costs and expenses			148,307				115,245				431,929				298,750
Income from continuing operations before income taxes			94,046				104,380				206,779				269,495
Income tax provision
Current			133				615				416				1,815
Deferred			34,802				38,707				73,698				99,533
			34,935				39,322				74,114				101,348
Income from continuing operations			59,111				65,058				132,665				168,147
Discontinued operations, net of income taxes			(196	)			(13,728	)			63,593				(9,872	)
Net income		$	58,915			$	51,330			$	196,258			$	158,275
Earnings per common share:
Basic — income from continuing operations		$	0.40			$	0.47			$	0.92			$	1.27
- discontinued operations			—				(0.10	)			0.45				(0.07	)
- net income		$	0.40			$	0.37			$	1.37			$	1.20
Diluted — income from continuing operations		$	0.39			$	0.46			$	0.89			$	1.22
- discontinued operations			—				(0.10	)			0.43				(0.07	)
- net income		$	0.39			$	0.36			$	1.32			$	1.15
Dividends per common share		$	0.03			$	0.02			$	0.09			$	0.06
Weighted average common shares outstanding:
Basic			147,182				136,983				143,508				132,426
Diluted			152,391				142,022				148,671				137,466

See accompanying notes.

RANGE RESOURCES CORPORATION

		Nine Months Ended
		September 30,
		2007				2006
Operating activities:
Net income		$	196,258			$	158,275
Adjustments to reconcile to net cash provided from operating activities:
(Gains)/losses from discontinued operations			(63,593	)			9,872
(Gains)/losses from equity method investments			(1,280	)			61
Deferred income tax expense			73,698				99,533
Depletion, depreciation and amortization			155,798				106,252
Unrealized derivative gains			(502	)			(3,178	)
Mark-to-market (gains)/losses on oil and gas derivatives not designated as hedges			40,171				(83,734	)
Exploration dry hole costs			9,072				9,291
Amortization of deferred issuance costs and other			1,667				1,221
Non-cash compensation			46,770				13,839
Loss on sale of assets and other			2,247				1,009
Changes in working capital, net of amounts from business acquisitions:
Accounts receivable			(29,595	)			29,323
Inventory and other			(1,672	)			(1,911	)
Accounts payable			11,597				(17,801	)
Accrued liabilities and other			4,894				(2,387	)
Net cash provided from continuing operations			445,530				319,665
Net cash provided from discontinued operations			10,189				28,475
Net cash provided from operating activities			455,719				348,140
Investing activities:
Additions to oil and gas properties			(601,046	)			(328,362	)
Additions to field service assets			(20,318	)			(10,033	)
Acquisitions, net of cash acquired			(309,660	)			(336,735	)
Investment in equity method affiliates and other			(93,313	)			(21,008	)
Purchases of marketable securities held by deferred compensation plan			(34,724	)			—
Proceeds from sales of marketable securities held by deferred compensation plan			33,823				—
Proceeds from disposal of assets			25				166
Proceeds from disposal of discontinued operations			234,304				—
Investing activities of discontinued operations			(7,375	)			(18,630	)
Net cash used in investing activities			(798,284	)			(714,602	)
Financing activities:
Borrowings on credit facility			718,000				650,500
Repayments on credit facility			(904,000	)			(535,000	)
Debt issuance costs			(2,727	)			(5,560	)
Dividends paid			(13,098	)			(8,021	)
Issuance of common stock, net			292,753				12,544
Issuance of subordinated notes			250,000				249,500
Proceeds from sales of common stock held by deferred compensation plan and other			4,845				—
Purchases of common stock held by deferred compensation plan and other treasury stock purchases			(5,403	)			—
Net cash provided from financing activities			340,370				363,963
Net decrease in cash and equivalents			(2,195	)			(2,499	)
Cash and equivalents at beginning of period			2,382				4,750
Cash and equivalents at end of period		$	187			$	2,251

See accompanying notes.

RANGE RESOURCES CORPORATION

		Three Months Ended								Nine Months Ended
		September 30,								September 30,
		2007				2006				2007				2006
Net income		$	58,915			$	51,330			$	196,258			$	158,275
Net deferred hedge gains/(losses), net of tax:
Contract settlements reclassified to income			18,337				14,511				(8,863	)			50,130
Change in unrealized deferred hedging gains/(losses)			(17,093	)			66,692				(16,295	)			108,672
Change in unrealized gains on securities held by deferred compensation plan, net of taxes			491				433				1,611				191
Comprehensive income		$	60,650			$	132,966			$	172,711			$	317,268

See accompanying notes.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

(1) ORGANIZATION AND NATURE OF BUSINESS

     We are engaged in the exploration, development and acquisition of oil and gas properties primarily in the Southwestern, Appalachian and Gulf Coast regions of the United States. We seek to increase our reserves and production primarily through drilling and complementary acquisitions. We are a Delaware corporation whose common stock is traded on the New York Stock Exchange.

(2) BASIS OF PRESENTATION

     Certain disclosures have been condensed or omitted from these statements. Therefore, these interim financial statements should be read in conjunction with the consolidated financial statements and notes thereto included in the Range Resources Corporation 2006 Annual Report on Form 10-K and our Form 8-K filed on June 19, 2007. These consolidated financial statements are unaudited but, in the opinion of management, reflect all adjustments necessary for fair presentation of the results for the periods presented. All adjustments are of a normal recurring nature unless disclosed otherwise. These consolidated financial statements, including selected notes, have been prepared in accordance with the applicable rules of the Securities and Exchange Commission (“SEC”) and do not include all of the information and disclosures required by accounting principles generally accepted in the United States for complete financial statements. Certain reclassifications have been made to the presentation of prior periods to conform to the current year presentation, which includes the presentation of our Gulf of Mexico operations as discontinued operations and the reclassification of settled derivatives that do not qualify for hedge accounting from oil and gas sales to derivative fair value income. We previously had been reclassifying the realized gain or loss from non-hedge derivatives into oil and gas sales. This reclassification will now present all gains and losses, realized and unrealized, on the derivative fair value income line in our consolidated statements of operations. These are changes to presentation only and do not affect previously reported net income, total revenues or earnings per share. The following table details the affected financial statement line items related to the revenue reclassification for the periods previously reported, including the six months ended June 30, 2007 and the nine months ended September 30, 2006 (in thousands):

		Three Months Ended				Three Months Ended				Six Months Ended
		March 31, 2007				June 30, 2007				June 30, 2007
As reported:
Oil and gas sales		$	217,026			$	221,591			$	438,617
Mark-to-market on oil and gas derivatives			(66,111	)			20,322				(45,789	)
		$	150,915			$	241,913			$	392,828
As reclassified:
Oil and gas sales		$	193,316			$	213,896			$	407,212
Derivative fair value income			(42,401	)			28,017				(14,384	)
		$	150,915			$	241,913			$	392,828

		Three Months Ended				Three Months Ended				Three Months Ended				Nine Month Ended
		March 31, 2006				June 30, 2006				September 30, 2006				September 30, 2006
As reported:
Oil and gas sales		$	166,555			$	149,358			$	163,410			$	479,323
Mark-to-market on oil and gas derivatives			11,281				17,503				54,950				83,734
		$	177,836			$	166,861			$	218,360			$	563,057
As reclassified:
Oil and gas sales		$	150,658			$	139,431			$	153,054			$	443,143
Derivative fair value income			27,178				27,430				65,306				119,914
		$	177,836			$	166,861			$	218,360			$	563,057

     During the first quarter of 2007, we sold our interests in our Austin Chalk properties that we purchased as part of the Stroud acquisition. We also sold our Gulf of Mexico properties at the end of the first quarter of 2007. In accordance with Statement of Financial Accounting Standards (“SFAS”) No. 144, “Accounting for the Impairment or Disposal of Long-Lived Assets,” we have reflected the results of operations of the above divestitures as discontinued operations, rather than a component of continuing operations. See Note 4 for additional information regarding discontinued operations.

(3) ACQUISITIONS AND DISPOSITIONS

Acquisitions

     In May 2007, we acquired additional interests in the Nora field of Virginia and entered into a joint development plan with Equitable Resources, Inc (“Equitable”). As a result of this transaction, Equitable and Range equalized their working interests in the Nora field, including producing wells, undrilled acreage and gathering systems. Range retained its separately owned royalty interest in the Nora field. Equitable will operate the producing wells, manage the drilling operations of all future coal bed methane wells and manage the gathering system. Range will oversee the drilling of formations below the coal bed methane formations, including tight gas, shale and deeper formations. A newly formed limited liability corporation will hold the investment in the gathering system which is owned 50% by Equitable and 50% by Range. All business decisions require a unanimous consent of both parties. The gathering system investment is accounted for as an equity method investment. Including estimated transaction costs, we paid $278.6 million which includes $188.3 million allocated to oil and gas properties, $93.4 million allocated to our equity method investment and a $3.1 million asset retirement obligation. No pro forma information has been provided as the acquisition was not considered significant.

     In June 2006, we acquired Stroud Energy, Inc. (“Stroud”), a private oil and gas company with operations in the Barnett Shale in North Texas, the Cotton Valley in East Texas and the Austin Chalk in Central Texas. To acquire Stroud, we paid $171.5 million of cash and issued 6.5 million shares of our common stock.

     The following table summarizes the final purchase price allocation to assets acquired and liabilities assumed at closing in the Stroud acquisition (in thousands):

Cash paid (including transaction costs)		$	171,529
6.5 million shares of common stock (at fair value of $27.26 per share)			177,641
Stock options assumed (652,000 options)			9,478
Debt retired			106,700
Total		$	465,348
Allocation of purchase price:
Working capital deficit		$	(13,557	)
Other long-term assets			55
Oil and gas properties			487,345
Assets held for sale			140,000
Deferred income taxes			(147,062	)
Asset retirement obligation			(1,433	)
Total		$	465,348

Pro Forma

          The following unaudited pro forma data includes the results of operations as if the Stroud acquisition had been consummated at the beginning of 2006. See also Note 4 for additional information on discontinued operations. The pro forma data are based on historical information and do not necessarily reflect the actual results that would have occurred, nor are they necessarily indicative of future results of operations (in thousands, except per share data).

		Nine Months
		Ended
		September 30,
		2006
Revenues		$	602,920
Income from continuing operations			167,570
Net income			161,571
Per share data:
Income from continuing operations – basic		$	1.22
Income from continuing operations – diluted			1.18
Net income – basic		$	1.18
Net income – diluted			1.14

Dispositions

          In February 2007, we sold the Stroud Austin Chalk properties for proceeds of $80.4 million and recorded a loss on the sale of $2.3 million. These properties were originally acquired in mid —2006 as part of our Stroud acquisition and were classified as assets held for sale since the acquisition date. In March 2007, we sold our Gulf of Mexico properties for proceeds of $155.0 million and recorded a gain on the sale of $95.1 million. The properties included any properties within the waters of the Gulf of Mexico (either state or federal). We have reflected the results of operations of the above divestitures as discontinued operations rather than a component of continuing operations. See Note 4 for additional information.

(4) DISCONTINUED OPERATIONS

          As part of the Stroud acquisition, we purchased Austin Chalk properties in East Texas which we sold in February 2007 for proceeds of $80.4 million. These Austin Chalk properties were classified as Assets Held for Sale on our balance sheet as of December 31, 2006 and were reflected in discontinued operations in our consolidated statement of operations in the twelve months ended December 31, 2006. In March 2007, we sold our Gulf of Mexico properties for proceeds of $155.0 million. All prior year periods include the reclassification of our Gulf of Mexico operations to discontinued operations.

          Discontinued operations for the three months and the nine months ended September 30, 2007 and 2006 are summarized as follows (in thousands):

		Three Months Ended								Nine Months Ended
		September 30,								September 30,
		2007				2006				2007				2006
Revenues:
Oil and gas sales		$	—			$	18,959			$	15,187			$	38,022
Transportation and gathering			—				19				10				76
Other			—				(1	)			310				(2	)
Gain (loss) on disposition of assets and other			(298	)			—				92,757				—
			(298	)			18,977				108,264				38,096
Costs and expenses:
Direct operating			—				2,923				2,559				8,113
Production and ad valorem taxes			—				409				141				777
Exploration and other			3				179				215				1,349
Interest expense			—				1,259				845				1,936
Depletion, depreciation and amortization			—				5,652				6,672				11,406
Impairment			—				30,362				—				30,362
			3				40,784				10,432				53,943
Income (loss) from discontinued operations before income taxes			(301	)			(21,807	)			97,832				(15,847	)
Income tax expense (benefit)			(105	)			(8,079	)			34,239				(5,975	)
Income (loss) from discontinued operations, net of taxes		$	(196	)		$	(13,728	)		$	63,593			$	(9,872	)
Production:
Crude oil (bbls)			—				43,323				40,634				100,515
Natural gas (mcf)			—				2,734,521				1,990,277				5,187,183
Total (mcfe)			—				2,994,459				2,234,081				5,790,273

          Due to falling oil and gas prices since the acquisition, we recognized a $30.4 million impairment on the Austin Chalk properties during the three months ended September 30, 2006. Ultimately, for the twelve months ended December 31, 2006, we recognized an impairment of $74.9 million.

(5) INCOME TAXES

          Income tax included in continuing operations was as follows (in thousands):

		Three Months Ended								Nine Months Ended
		September 30,								September 30,
		2007				2006				2007				2006
Income tax expense		$	34,935			$	39,322			$	74,114			$	101,348
Effective tax rate			37.1	%			37.7	%			35.8	%			37.6	%

          We compute our quarterly taxes under the effective tax rate method based on applying an anticipated annual effective rate to our year-to-date income or loss, except for discrete items. Income taxes for discrete items are computed and recorded in the period that the specific transaction occurs. For the three months and nine months ended September 30, 2007, our overall effective tax rate on continuing operations was different than the statutory rate of 35% primarily due to state income taxes and an increase in our deferred tax assets related to state tax credit carryovers. The nine months ended September 30, 2007 includes a $3.0 million non-recurring tax benefit related to an increase in the Texas margin tax carryforward. For the three months and nine months ended September 30, 2006, our overall effective tax rate on continuing operations was different than the statutory rate of 35% due primarily to state income taxes. We expect our effective tax rate to be approximately 37% for the remainder of 2007.

          At December 31, 2006, we had regular tax net operating loss (“NOL”) carryovers of $216.4 million and alternative minimum tax (“AMT”) NOL carryovers of $173.4 million that expire between 2012 and 2026. Even with the gain recognized on the sale of our Gulf of Mexico assets, we expect our NOL carryovers to increase in 2007 due to the current deduction of intangible drilling costs for tax purposes. Our deferred tax asset related to regular NOL carryovers at December 31, 2006 was $51.6 million, net of the SFAS No. 123(R) deduction for unrealized excess tax benefits. At December 31, 2006, we had AMT credit carryovers of $777,000 that are not subject to limitation or expiration.

(6) EARNINGS PER COMMON SHARE

          The following table sets forth the computation of basic and diluted earnings per common share (in thousands except per share amounts):

		Three Months Ended								Nine Months Ended
		September 30,								September 30,
		2007				2006				2007				2006
Numerator:
Income from continuing operations		$	59,111			$	65,058			$	132,665			$	168,147
Income (loss) from discontinued operations, net of taxes			(196	)			(13,728	)			63,593				(9,872	)
Net income		$	58,915			$	51,330			$	196,258			$	158,275
Denominator:
Weighted average shares outstanding			148,586				138,318				144,705				133,767
Stock held in the deferred compensation plan and treasury stock			(1,404	)			(1,335	)			(1,197	)			(1,341	)
Weighted average shares, basic			147,182				136,983				143,508				132,426
Effect of dilutive securities:
Weighted average shares outstanding			148,586				138,318				144,705				133,767
Employee stock options, SARs and other			3,883				3,704				3,992				3,699
Treasury shares			(78	)			—				(26	)			—
Dilutive potential common shares for diluted earnings per share			152,391				142,022				148,671				137,466
Earnings per common share basic and diluted:
Basic – income from continuing operations		$	0.40			$	0.47			$	0.92			$	1.27
– discontinued operations			—				(0.10	)			0.45				(0.07	)
– net income		$	0.40			$	0.37			$	1.37			$	1.20
Diluted – income from continuing operations		$	0.39			$	0.46			$	0.89			$	1.22
– discontinued operations			—				(0.10	)			0.43				(0.07	)
– net income		$	0.39			$	0.36			$	1.32			$	1.15

          Stock appreciation rights for 544,133 and 281,597 shares were outstanding but not included in the computations of diluted net income per share for the three months and the nine months ended September 30, 2007 because the grant prices of the SARs were greater than the average market price of the common shares and would be anti-dilutive to the computations. Stock appreciation rights for 48,000 and 18,000 shares were outstanding but not included in the computations of diluted net income per share for the three months and the nine months ended September 30, 2006 because the grant price of the SARs was greater than the average price of the common shares and would be anti-dilutive to the computations.

(7) SUSPENDED EXPLORATORY WELL COSTS

          The following table reflects the changes in capitalized exploratory well costs for the nine months ended September 30, 2007 and the year ended December 31, 2006 (in thousands):

		September 30,				December 31,
		2007				2006
Beginning balance at January 1		$	9,984			$	25,340
Additions to capitalized exploratory well costs pending the determination of proved reserves			12,861				4,695
Reclassifications to wells and equipment based on determination of proved reserves			(3,430	)			(16,710	)
Capitalized exploratory well costs charged to expense			(8,225	)			(3,341	)
Divested wells			(1,325	)			—
Balance at end of period			9,865				9,984
Less exploratory well costs that have been capitalized for a period of one year or less			(8,828	)			(4,792	)
Capitalized exploratory well costs that have been capitalized for a period greater than one year		$	1,037			$	5,192
Number of projects that have exploratory well costs that have been capitalized for a period greater than one year			2				3

          The $9.9 million of capitalized exploratory well costs at September 30, 2007 was incurred in 2007 ($6.9 million) and in 2006 ($3.0 million). As of September 30, 2007, of the $1.0 million of exploratory costs that have been capitalized for more than one year, one of the wells is not operated by us and the other well has been delayed due to rig availability.

(8) INDEBTEDNESS

          We had the following debt outstanding as of the dates shown below (in thousands) (bank debt interest rate at September 30, 2007 is shown parenthetically). No interest expense was capitalized during the three months or the nine months ended September 30, 2007 and 2006.

		September 30,				December 31,
		2007				2006
Bank debt (6.3%)		$	266,000			$	452,000
Subordinated debt:
7.375% Senior Subordinated Notes due 2013, net of discount			197,515				197,262
6.375% Senior Subordinated Notes due 2015			150,000				150,000
7.5% Senior Subordinated Notes due 2016, net of discount			249,547				249,520
7.5% Senior Subordinated Notes due 2017			250,000				—
Total debt		$	1,113,062			$	1,048,782

Bank Debt

          In October 2006, we entered into an amended and restated revolving bank facility, which we refer to as our bank debt or bank credit facility, which is secured by substantially all of our assets. The bank credit facility provides for an initial commitment equal to the lesser of a facility amount or the borrowing base. On September 30, 2007, the facility amount was $900.0 million. On October 22, 2007, the borrowing base was redetermined to be $1.5 billion and the maturity date was extended to October 25, 2012. The bank credit facility provides for a borrowing base subject to redeterminations semi —annually each April and October and pursuant to certain unscheduled redeterminations. Redeterminations other than increases require approval of 75% of the lenders, while increases require unanimous approval. Subject to certain conditions, the facility amount may be increased to the borrowing base amount with twenty days notice. At September 30, 2007, the outstanding balance under the bank credit facility was $266.0 million and there was $634.0 million of borrowing capacity available. Borrowing under the bank credit facility can either be base rate loans or LIBOR loans. On all base rate loans, the rate per annum is equal to the lesser of (i) the maximum rate (the “weekly ceiling” as defined in Section 303 of the Texas Finance Code or other applicable laws if greater) (the “Maximum Rate”) or, (ii) the sum of the higher of (1) the prime rate for

such date, or (2) the sum of the federal funds effective rate for such date plus one —half of one percent (0.50%) per annum, plus a base rate margin of between 0.0% to 0.5% per annum depending on the total outstanding under the bank credit facility relative to the borrowing base. On all LIBOR loans, we pay a varying rate per annum equal to the lesser of (i) the Maximum Rate, or (ii) the sum of the quotient of (A) the LIBOR base rate, divided by (B) one minus the reserve requirement applicable to such interest period, plus a LIBOR margin of between 1.0% and 1.75% per annum depending on the total outstanding under the bank credit facility relative to the borrowing base. We may elect, from time to time, to convert all or any part of our LIBOR loans to base rate loans or to convert all or any part of the base rate loans to LIBOR loans. The weighted average interest rate on the bank credit facility was 6.5% for the three months ended September 30, 2007 compared to 6.7% for the three months ended September 30, 2006. The weighted average interest rate on the bank credit facility was 6.5% for the nine months ended September 30, 2007 compared to 6.3% for the same period of 2006. A commitment fee is paid on the undrawn balance based on an annual rate of between 0.25% and 0.375%. At September 30, 2007, the commitment fee was 0.25% and the interest rate margin was 1.0%. On October 22, 2007, the interest rate on the bank credit facility (including applicable margin) was 6.2%.

Senior Subordinated Notes

          In 2003, we issued $100.0 million principal amount of 7.375% senior subordinated notes due 2013 (“7.375% Notes”). In 2004, we issued an additional $100.0 million of 7.375% Notes; therefore, $200.0 million of the 7.375% Notes is currently outstanding. In 2005, we issued $150.0 million principal amount of 6.375% senior subordinated notes due 2015 (“6.375% Notes”). In May 2006, we issued $150.0 million principal amount of the 7.5% senior subordinated notes due 2016 (“7.5% Notes due 2016”). In August 2006, we issued an additional $100.0 million of the 7.5% Notes due 2016; therefore, $250.0 million of the 7.5% Notes due 2016 is currently outstanding. On September 28, 2007, we issued $250.0 million principal amount of 7.5% senior subordinated notes due 2017 (“7.5% Notes due 2017”). Interest on our senior subordinated notes is payable semi —annually, at varying times, and each of the notes is guaranteed by certain of our subsidiaries.

          We may redeem the 7.375% Notes, in whole or in part, at any time on or after July 15, 2008, at redemption prices of 103.7% of the principal amount as of July 15, 2008, and declining to 100.0% on July 15, 2011 and thereafter. We may redeem the 6.375% Notes, in whole or in part, at any time on or after March 15, 2010, at redemption prices from 103.2% of the principal amount as of March 15, 2010 and declining to 100% on March 15, 2013 and thereafter. Prior to March 15, 2008, we may redeem up to 35% of the original aggregate principal amount of the 6.375% Notes at a redemption price of 106.4% of the principal amount thereof plus accrued and unpaid interest, if any, with the proceeds of certain equity offerings. We may redeem the 7.5% Notes due 2016, in whole or in part, at any time on or after May 15, 2011 at redemption prices from 103.75% of the principal amount as of May 15, 2011 and declining to 100% on May 15, 2014 and thereafter. Prior to May 15, 2009, we may redeem up to 35% of the original aggregate principal amount of the 7.5% Notes due 2016 at a redemption price of 107.5% of principal amount thereof plus accrued and unpaid interest if any, with the proceeds of certain equity offerings provided that at least 65% of the original aggregate principal amount of our 7.5% Notes due 2016 remains outstanding immediately after the occurrence of such redemption and provided that such redemption occurs within 60 days of the date of closing the equity sale. We may redeem the 7.5% Notes due 2017, in whole or in part, at any time on or after October 1, 2012 at redemption prices from 103.75% of the principal amount as of October 1, 2012 and declining to 100% on October 1, 2015 and thereafter. Prior to October 1, 2010, we may redeem up to 35% of the original aggregate principal amount of the 7.5% Notes due 2017 at a redemption price of 107.5% of principal amount thereof plus accrued and unpaid interest, if any, with the proceeds of certain equity offerings provided that at least 65% of the original aggregate principal amount of our 7.5% Notes due 2017 remains outstanding immediately after the occurrence of such redemption and provided that such redemption occurs within 60 days of the date of closing the equity sale.

          If we experience a change of control, there may be a requirement to repurchase all or a portion of the senior subordinated notes at 101% of the principal amount plus accrued and unpaid interest, if any. All of the senior subordinated notes and the guarantees by our subsidiary guarantors are general unsecured obligations and are subordinated to our bank debt and will be subordinated to future senior debt that we or our subsidiary guarantors are permitted to incur under the bank credit facility and the indentures governing the senior subordinated notes.

Subsidiary Guarantors

          Range Resources Corporation is a holding company which owns no operating assets and has no significant operations independent of its subsidiaries. The guarantees of the 7.375% Notes, the 6.375% Notes, the 7.5% Notes due 2016 and the 7.5% Notes due 2017 are full and unconditional and joint and several; any subsidiaries other than the subsidiary guarantors are minor subsidiaries.

Debt Covenants

          The debt agreements contain covenants relating to working capital, dividends and financial ratios. We were in compliance with all covenants at September 30, 2007. Under the bank credit facility, dividends are permitted, subject to the provisions of the restricted payment basket. The bank credit facility provides for a restricted payment basket of $20.0 million plus 50% of net income and 66 —2/3% of net cash proceeds from common stock issuances. Approximately $726.4 million was available under the bank credit facility’s restricted payment basket on September 30, 2007. The terms of each of our subordinated notes limit restricted payments (including dividends) to the greater of $20.0 million or a formula based on earnings and equity issuances since the original issuance of the notes. The 7.5% Notes due 2016 also allows for any cash proceeds received from the sale of oil and gas property purchased in the Stroud acquisition to be added to the restricted payment basket. At September 30, 2007, $900.8 million was available under the restricted payment baskets for each of the 7.375% Notes, 6.375% Notes and the 7.5% Notes due 2017. There was $981.8 million available under the restricted payment basket for the 7.5% Notes due 2016.

(9) ASSET RETIREMENT OBLIGATION

          A reconciliation of our liability for plugging and abandonment costs, including discontinued operations, for the nine months ended September 30, 2007 and 2006 is as follows (in thousands):

		Nine Months Ended
		September 30,
		2007				2006
Beginning of period		$	95,588			$	68,063
Liabilities incurred			3,004				3,150
Acquisitions			3,091				1,433
Liabilities settled			(1,056	)			(2,973	)
Disposition of wells			(20,850	)			—
Accretion expense – continuing operations			3,843				2,307
Accretion expense – discontinued operations			382				1,119
Change in estimate			(3,442	)			3,634
End of period		$	80,560			$	76,733

          Accretion expense is included as a component of depreciation, depletion and amortization.

(10) CAPITAL STOCK

          We have authorized capital stock of 260 million shares, which includes 250 million shares of common stock and 10 million shares of preferred stock. The following is a schedule of changes in the number of common shares issued:

		Nine Months Ended				Year Ended
		September 30, 2007				December 31, 2006
Beginning of period			138,931,565				129,913,046
Equity offering			8,050,000				—
Shares issued for Stroud acquisition			—				6,517,498
Stock options/SARs exercised			1,544,193				1,956,164
Restricted stock grants			394,497				474,609
Deferred compensation plan			13,570				12,998
In lieu of bonuses			29,483				20,686
Contributed to 401(k) plan			—				36,564
			10,031,743				9,018,519
End of period			148,963,308				138,931,565

Treasury Stock

     The Board of Directors has approved up to $10.0 million of repurchases of common stock based on market conditions and opportunities. In the third quarter of 2007, we bought in open market purchases, 155,500 shares at an average price of $34.30. We intend to use such treasury shares for our compensation arrangements to reduce dilution to stockholders.

(11) DERIVATIVE ACTIVITIES

     At September 30, 2007, we had open swap contracts covering 73.9 Bcf of gas at prices averaging $8.99 per mcf. We also had collars covering 29.2 Bcf of gas at weighted average floor and cap prices which range from $7.68 to $10.94 per mcf, and 7.0 million barrels of oil at weighted average floor and cap prices that range from $61.11 to $74.99 per barrel. Their fair value, represented by the estimated amount that would be realized upon termination, based on a comparison of the contract prices and a reference price, generally New York Mercantile Exchange (“NYMEX”), on September 30, 2007, was a net unrealized pre-tax gain of $68.9 million. These contracts expire monthly through December 2009.

     Settled transaction gains and losses for derivatives that qualify for hedge accounting are determined monthly and are included as increases or decreases to oil and gas sales in the period the hedged production is sold. Oil and gas sales were increased by realized gains of $4.1 million in the third quarter of 2007 compared to realized losses of $23.0 million in the third quarter of 2006. Oil and gas sales were increased by realized gains of $14.1 million in the first nine months of 2007 compared with realized losses of $79.6 million in the first nine months of 2006. Other revenues in our consolidated statement of operations include ineffective hedging gains on hedges that qualified for hedge accounting of $502,000 in the first nine months of 2007 compared with gains of $3.5 million in the first nine months of 2006.

     In the fourth quarter of 2005, certain of our gas hedges no longer qualified for hedge accounting due to the effect of gas price volatility on the correlation between realized prices and hedge reference prices. Also, as a result of the sale of our Gulf of Mexico assets in the first quarter of 2007, a portion of the derivatives which were designated to our Gulf Coast production is now being marked to market. These derivatives have been retained to serve as economic hedges for our production even though we can no longer apply hedge accounting.

     The following table sets forth our natural gas and oil derivative volumes by year as of September 30, 2007:

						Weighted
Period		Contract Type		Volume Hedged		Average Hedge Price
Natural Gas
2007 – 4th quarter		Swaps		107,500 Mmbtu/day		$9.49
2007 – 4th quarter		Collars		98,500 Mmbtu/day		$7.12 — $9.93
2008		Swaps		135,000 Mmbtu/day		$9.11
2008		Collars		55,000 Mmbtu/day		$7.93 — $11.40
2009		Swaps		40,000 Mmbtu/day		8.24
Crude Oil
2007 – 4th quarter		Collars		8,300 bbl/day		$57.69 — $68.98
2008		Collars		9,000 bbl/day		$59.34 — $75.48
2009		Collars		8,000 bbl/day		$64.01 — $76.00

     During the third quarter of 2007, in addition to the swaps and collars above, we entered into basis swap agreements which do not qualify as hedges for hedge accounting purposes and are marked to market. The price we receive for our gas production can be less then NYMEX price because of adjustments for delivery location (“basis”), relative quality and other factors; therefore, we have entered into basis swap agreements that effectively fix our basis adjustments. The fair value of the basis swaps was a net realized pre-tax gain of $1.3 million at September 30, 2007.

     Prior to July 1, 2007, we had been reclassifying the realized gain and loss from non-hedge derivatives into oil and gas sales. Effective July 1, 2007, we have retroactively reclassified the realized gains and losses from non-hedge derivatives to the line derivative fair value income. Thus, all gains and losses realized and unrealized from non-hedge derivatives are now presented as derivative fair value income. The following is a summary of derivative fair value income included in our consolidated statements of operations (in thousands):

		Three Months Ended								Nine Months Ended
		September 30,								September 30,
		2007				2006				2007				2006
Change in unrealized mark-to-market on oil and gas derivative contracts not designated as hedges		$	5,618			$	54,950			$	(40,171	)		$	83,734
Cash receipts realized on settlements of non-hedge contracts — gas(a)			19,417				10,356				50,818				36,180
Cash payments realized on settlements of non-hedge contracts — oil(a)			(33	)			—				(29	)			—
Derivative fair value income		$	25,002			$	65,306			$	10,618			$	119,914

     The combined fair values of derivatives included in the consolidated balance sheets at September 30, 2007 and December 31, 2006 are summarized below. Hedging activities are conducted with major financial and commodities trading institutions which we believe are acceptable credit risks. At times, such risks may be concentrated with certain counterparties. We have master netting agreements with our counterparties. The creditworthiness of the counterparties is subject to continuing review.

		September 30,				December 31,
		2007				2006
Derivative assets:
Natural gas – swaps		$	78,559			$	121,792
– collars			17,478				36,973
– basis swaps			937				—
Crude oil – collars			(14,231	)			(4,109	)
		$	82,743			$	154,656
Derivative liabilities:
Natural gas – swaps			(810	)			248
– collars			(1,929	)			(2,337	)
– basis swaps			(316	)			—
Crude oil – collars			15,679				6,976
		$	12,624			$	4,887

(12) EMPLOYEE BENEFIT AND EQUITY PLANS

     We have six equity-based stock plans, of which two are active. Under the active plans, incentive and non-qualified options, stock appreciation rights (“SARs”), restricted stock awards, phantom stock rights and annual cash incentive awards may be issued to directors and employees pursuant to decisions of the Compensation Committee which is made up of independent directors from the Board of Directors. All awards granted have been issued at prevailing market prices at the time of the grant. During 2007 and 2006, the only type of award issued under our two active plans has been SARs to reduce the dilutive impact of our equity plans. Information with respect to stock option and SARs activities is summarized below:

						Weighted
						Average
		Shares				Exercise Price
Outstanding on December 31, 2006			8,852,126			$	12.76
Granted			1,667,143				33.71
Exercised			(1,754,643	)			10.74
Expired/forfeited			(293,865	)			23.32
Outstanding on September 30, 2007			8,470,761			$	16.94

     The following table shows information with respect to outstanding stock options and SARs at September 30, 2007:

		Outstanding												Exercisable
						Weighted-
						Average				Weighted-								Weighted-
						Remaining				Average								Average
Range of Exercise Prices		Shares				Contractual Life				Exercise Price				Shares				Exercise Price
$  1.29 — $  9.99			2,961,039				2.19			$	4.71				2,961,039			$	4.71
10.00 —   19.99			2,425,931				2.64				16.21				1,407,814				15.84
20.00 —   29.99			1,498,823				3.49				24.44				443,390				24.38
30.00 —   39.99			1,580,568				4.48				33.80				44,100				38.02
40.00 —   41.01			4,400				4.81				40.66				—				—
Total			8,470,761				2.98			$	16.94				4,856,343			$	10.03

     The weighted average fair value of a SAR to purchase one share of common stock granted during 2007 was $10.64. The fair value of each SAR granted during 2007 was estimated as of the date of grant using the Black-Scholes-Merton option pricing model based on the following weighted average assumptions: risk-free interest rate of 4.74%, dividend yield of 0.36%, expected volatility of 35.66% and an expected life of 3.54 years.

     As of September 30, 2007, the aggregate intrinsic value (the difference in value between exercise and market price) of all awards outstanding was $200.9 million. The aggregate intrinsic value and weighted average remaining contractual life of awards currently exercisable was $148.7 million and 2.48 years, respectively. As of September 30, 2007, the number of fully-vested awards and awards expected to vest was 8.3 million shares. The weighted average exercise price and weighted average remaining contractual life of these awards were $16.65 and 2.95 years, respectively, and the aggregate intrinsic value was $198.8 million. As of September 30, 2007, unrecognized compensation cost related to the awards was $21.2 million, which is expected to be recognized over a weighted average period of 1.08 years. Of the total outstanding awards at September 30, 2007, 4.3 million stock options are outstanding with a weighted-average exercise price of $7.93 and 4.2 million SARs are outstanding with a weighted average grant price of $26.36.

Restricted Stock Grants

     During the first nine months of 2007, 429,100 shares of restricted stock were issued to directors and employees as compensation at an average price of $34.75. The grants to directors are immediately vested while the employee grants have a three-year vesting period. In the first nine months of 2006, we issued 476,200 shares of restricted stock as compensation to directors and employees at an average price of $24.32. We recorded compensation expense related to restricted stock grants which is based upon the market value of the shares on the date of grant of $2.3 million in the third quarter of 2007 compared to $1.3 million in the same quarter of the prior year. We recorded compensation expense related to restricted stock grants of $6.4 million in the first nine months of 2007 compared to $2.8 million in the same period of 2006. All restricted shares are granted in lieu of cash awards and are placed in the deferred compensation plan (see below). As of September 30, 2007, unrecognized compensation cost related to these restricted stock awards was $20.8 million, which is expected to be recognized over the next 3 years.

Deferred Compensation Plan

     In December 2004, we adopted the Range Resources Corporation Deferred Compensation Plan (“2005 Deferred Compensation Plan”). The 2005 Deferred Compensation Plan gives directors, officers and key employees the ability to defer all or a portion of their salaries and bonuses and invests such amounts in Range common stock or makes other investments at the individual’s discretion. The assets of the plan are held in a rabbi trust, which we refer to as the Rabbi Trust, and are therefore available to satisfy the claims of our creditors in the event of bankruptcy or insolvency. Our stock held in the Rabbi Trust is treated in a manner similar to treasury stock with an offsetting amount reflected as a deferred compensation liability and the carrying value of the deferred compensation liability is adjusted to fair value each reporting period by a charge or credit to deferred compensation plan expense on our consolidated statement of operations. The assets of the Rabbi Trust, other than Range common stock, are invested in marketable securities and reported at market value in other assets on our consolidated balance sheet. The deferred compensation liability on our balance sheet reflects the market value of the securities held in the Rabbi Trust. The cost of common stock held in the Rabbi Trust is shown as a reduction to stockholders’ equity. Changes in the market value of the marketable securities are reflected in other comprehensive income (“OCI”), while changes in the market value of the Range common stock held in the Rabbi Trust are charged or credited to deferred compensation plan expense each quarter. We recorded non-cash mark-to-market expense related to our deferred

compensation plan of $7.8 million in the third quarter of 2007 compared to income of $2.6 million in the third quarter of 2006. We recorded non-cash mark-to-market expense related to our deferred compensation plan of $28.3 million in the first nine months of 2007 compared to income of $348,000 in the first nine months of 2006.

(13) SUPPLEMENTAL CASH FLOW INFORMATION

		Nine Months Ended
		September 30,
		2007				2006
		(in thousands)
Non-cash investing and financing activities included:
Common stock issued under compensation arrangements		$	7,660			$	3,679
Asset retirement costs capitalized			(438	)			6,765
Common stock issued for Stroud purchase			—				177,641
Stock options assumed in Stroud acquisition			—				9,478
Net cash provided from operating activities included:
Income taxes paid		$	144			$	86
Interest paid			56,657				39,168

(14) COMMITMENTS AND CONTINGENCIES

     We are involved in various legal actions and claims arising in the ordinary course of our business. While the outcome of these lawsuits cannot be predicted with certainty, we do not expect these matters to have a material adverse effect on our financial position, cash flows or results of operations.

(15) CAPITALIZED COSTS AND ACCUMULATED DEPRECIATION, DEPLETION AND AMORTIZATION ^(a)

		September 30,				December 31,
		2007				2006
		(in thousands)
Oil and gas properties:
Properties subject to depletion		$	4,021,173			$	3,132,830
Unproved properties			265,006				226,263
Total			4,286,179				3,359,093
Accumulated depreciation, depletion and amortization			(924,155	)			(751,005	)
Net capitalized costs		$	3,362,024			$	2,608,088

(16) COSTS INCURRED FOR PROPERTY ACQUISITIONS, EXPLORATION AND DEVELOPMENT ^(a)

		Nine Months
		Ended				Year Ended
		September 30,				December 31,
		2007				2006
		(in thousands)
Acquisitions:
Unproved leasehold		$	4,552			$	132,821
Proved oil and gas properties			246,264				209,262
Purchase price adjustment (b)			—				147,062
Asset retirement obligation			3,091				896
Acreage purchases			59,477				79,762
Development			549,786				464,586
Exploration (c)			66,402				70,870
Gas gathering facilities			13,808				19,690
Subtotal			943,380				1,124,949
Asset retirement obligation			(438	)			25,821
Total costs incurred (d)		$	942,942			$	1,150,770

(17) NEW ACCOUNTING STANDARD

     In June 2006, the FASB issued FASB Interpretation No. 48, “Accounting for Uncertainty in Income Taxes” (“FIN 48”). FIN 48 is an interpretation of FASB Statement No. 109, “Accounting for Income Taxes,” and seeks to reduce the diversity in practice associated with certain aspects of measurement and recognition in accounting for income taxes. In addition, FIN 48 provides guidance on de-recognition, classification, interest and penalties, and accounting in interim periods and requires expanded disclosure with respect to the uncertainty in income taxes. We adopted the provisions of FIN 48 on January 1, 2007. There was no cumulative effect as a result of applying FIN 48. No adjustment was made to our opening balance of retained earnings. We have approximately $600,000 of unrecognized tax benefits recorded as of the date of adoption.

     We file consolidated tax returns in the United States federal jurisdiction and separate income tax returns in many state jurisdictions. We are subject to U.S. Federal income tax examinations for years after 2002 and we are subject to various state tax examinations for years after 2001.

     Our continuing practice is to recognize interest related to income tax expense in interest expense, and penalties in general and administrative expense. We do not have any accrued interest or penalties as of September 30, 2007.

(18) ACCOUNTING STANDARDS NOT YET ADOPTED

     In September 2006, the FASB issued SFAS No. 157, “Fair Value Measurements.” SFAS No. 157 standardizes the definition of fair value, establishes a framework for measuring fair value in generally accepted accounting principles and expands disclosures related to the use of fair value measures in financial statements. SFAS No. 157 applies whenever other standards require (or permit) assets or liabilities to be measured at fair value but does not expand the use of fair value measurements. SFAS No. 157 is effective for financial statements issued for fiscal years beginning after November 15, 2007, and interim periods within those fiscal years. We do not expect the implementation of SFAS 157 to have a material impact on our results of operations or financial condition.

     In February 2007, the FASB issued SFAS No. 159, “The Fair Value Option for Financial Assets and Financial Liabilities – including an amendment of FASB Statement No. 115.” SFAS No. 159 permits entities to measure many financial instruments and certain other assets and liabilities at fair value on an instrument-by-instrument basis. This statement allows entities to measure eligible items at fair value at specified election dates, with resulting changes in fair value reported in earnings. SFAS No. 159 is effective as of the beginning of an entity’s first fiscal year that begins after November 15, 2007. We are currently evaluating the provisions of this statement.

(a)		Oil and NGLs are converted at the rate of one barrel equals six mcfe.

21

     In the first quarter of 2007, we sold our Gulf of Mexico assets and our Austin Chalk properties that were purchased as part of our Stroud acquisition. These operations are shown in discontinued operations for all periods presented.

Comparison of Quarter Ended September 30, 2007 and 2006

     Oil and gas sales and average price calculations for the three months ended September 30, 2007 and 2006 (in thousands) are summarized in the following tables:

		Three Months Ended September 30,
		2007				2006				Change				%
Oil and Gas Sales:
Oil wellhead		$	59,218			$	49,611			$	9,607				19	%
Oil hedges realized			(5,120	)			(13,993	)			8,873				63	%
Total oil revenue		$	54,098			$	35,618			$	18,480				52	%
Gas wellhead		$	138,832			$	115,534			$	23,298				20	%
Gas hedges realized			9,235				(9,040	)			18,275				202	%
Total gas revenue		$	148,067			$	106,494			$	41,573				39	%
NGL revenue		$	12,259			$	10,942			$	1,317				12	%
Combined wellhead		$	210,309			$	176,087			$	34,222				19	%
Combined hedges realized			4,115				(23,033	)			27,148				118	%
Total oil and gas sales		$	214,424			$	153,054			$	61,370				40	%
Components of Derivative Fair Value Income:
Change in unrealized mark-to-market on oil and gas derivative contracts not designated as hedges(a)		$	5,618			$	54,950			$	(49,332	)			90	%
Cash receipts realized on settlements of non-hedge contracts — gas(d)			19,417				10,356				9,061				87	%
Cash payments realized on settlements of non-hedge contracts — oil(d)			(33	)			—				(33	)			—
Derivative fair value income		$	25,002			$	65,306			$	(40,304	)			62	%
Average Sales Price Calculation:
Average sales prices (wellhead):
Crude oil (per bbl)		$	70.51			$	64.53			$	5.98				9	%
NGLs (per bbl)		$	43.15			$	39.48			$	3.67				9	%
Natural gas (per mcf)		$	5.97			$	6.12			$	(0.15	)			2	%
Total (per mcfe) (b)		$	7.01			$	7.00			$	0.01				—
Average sales prices (including hedges):
Crude oil (per bbl)		$	64.41			$	46.33			$	18.08				39	%
NGLs (per bbl)		$	43.15			$	39.48			$	3.67				9	%
Natural gas (per mcf)		$	6.37			$	5.64			$	0.73				13	%
Total (per mcfe) (b)		$	7.15			$	6.08			$	1.07				18	%
Average sales prices (including all derivative settlements):
Crude oil (per bbl)		$	64.37			$	46.33			$	18.04				39	%
NGLs (per bbl)		$	43.15			$	39.48			$	3.67				9	%
Natural gas (per mcf)		$	7.20			$	6.19			$	1.01				17	%
Total (per mcfe) (b)		$	7.79			$	6.49			$	1.30				20	%
Average NYMEX prices(c)
Oil (per bbl)		$	75.38			$	70.48			$	4.90				7	%
Natural gas (per mcf)		$	6.13			$	6.53			$	(0.40	)			6	%