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Document And Entity Information - shares	3 Months Ended
Document And Entity Information - shares	Mar. 31, 2012	May 15, 2012
Document And Entity Information [Abstract]
Document Type	10-Q
Amendment Flag	false
Document Period End Date	Mar. 31, 2012
Document Fiscal Year Focus	2012
Document Fiscal Period Focus	Q1
Entity Registrant Name	Matador Resources Co
Entity Central Index Key	0001520006
Entity Filer Category	Non-accelerated Filer
Current Fiscal Year End Date	--12-31
Entity Common Stock, Shares Outstanding		55,507,543

Condensed Consolidated Balance Sheets - USD ($)	Mar. 31, 2012	Dec. 31, 2011
ASSETS
Cash and cash equivalents	$ 2,373,853	$ 10,284,180
Certificates of deposit	727,000	1,335,000
Accounts receivable
Oil and natural gas revenues	17,802,280	9,237,322
Joint interest billings	2,724,842	2,488,070
Other	1,099,885	1,446,113
Derivative instruments	10,908,380	8,988,767
Lease and well equipment inventory	1,343,416	1,343,416
Prepaid expenses	1,697,292	1,153,214
Total current assets	38,676,948	36,276,082
Property and equipment, at cost
Evaluated	489,385,342	423,944,476
Unproved and unevaluated	162,921,922	162,597,985
Other property and equipment	21,304,688	18,764,038
Less accumulated depletion, depreciation and amortization	(216,647,175)	(205,441,724)
Net property and equipment	456,964,777	399,864,775
Other assets
Derivative instruments	917,385	847,267
Deferred income taxes		1,593,331
Other assets	874,122	887,061
Total other assets	1,791,507	3,327,659
Total assets	497,433,232	439,468,516
LIABILITIES AND SHAREHOLDERS' EQUITY
Accounts payable	5,868,441	18,841,295
Accrued liabilities	43,440,919	25,438,893
Royalties payable	3,196,701	1,855,296
Borrowings under Credit Agreement		25,000,000
Derivative instruments	3,089,211	171,252
Deferred income taxes	2,396,156	3,023,760
Dividends payable - Class B		68,713
Other current liabilities	53,697	176,868
Total current liabilities	58,045,125	74,576,077
Long-term liabilities
Borrowings under Credit Agreement	15,000,000	88,000,000
Asset retirement obligations	4,136,370	3,935,084
Derivative instruments	2,724,273	382,848
Deferred income taxes	2,098,105
Other long-term liabilities	1,333,242	1,059,314
Total long-term liabilities	25,291,990	93,377,246
Commitments and contingencies (Note 10)
Shareholders' equity
Additional paid-in capital	402,244,834	263,561,890
Retained earnings	22,051,585	18,278,652
Treasury stock, at cost, 1,179,175 shares	(10,764,822)	(10,764,822)
Total shareholders' equity	414,096,117	271,515,193
Total liabilities and shareholders' equity	497,433,232	439,468,516
Class A [Member]
Shareholders' equity
Common stock	$ 564,520	429,166
Class B [Member]
Shareholders' equity
Common stock		$ 10,307

Condensed Consolidated Balance Sheets (parenthetical) - $ / shares	Mar. 31, 2012	Dec. 31, 2011
Treasury stock, shares	1,179,175	1,179,175
Class A [Member]
Common stock, par value	$ 0.01	$ 0.01
Common stock, shares authorized	80,000,000	80,000,000
Common stock, shares issued	56,452,035	42,916,668
Common stock, shares outstanding	55,272,860	41,737,493
Class B [Member]
Common stock, par value	$ 0.01	$ 0.01
Common stock, shares authorized	0	2,000,000
Common stock, shares issued	0	1,030,700
Common stock, shares outstanding	0	1,030,700

Condensed Consolidated Statements Of Operations - USD ($)	3 Months Ended
	Mar. 31, 2012	Mar. 31, 2011
Revenues
Oil and natural gas revenues	$ 29,163,667	$ 13,698,578
Realized gain on derivatives	3,062,700	1,849,750
Unrealized loss on derivatives	(3,269,652)	(1,668,115)
Total revenues	28,956,715	13,880,213
Expenses
Production taxes and marketing	2,164,486	1,299,557
Lease operating	4,645,200	1,605,092
Depletion, depreciation and amortization	11,205,450	7,111,211
Accretion of asset retirement obligations	52,750	39,220
Full-cost ceiling impairment		35,673,098
General and administrative	3,789,424	2,618,591
Total expenses	21,857,310	48,346,769
Operating income (loss)	7,099,405	(34,466,556)
Other income (expense)
Interest expense	(307,824)	(106,465)
Interest and other income	72,827	71,099
Total other expense	(234,997)	(35,366)
Income (loss) before income taxes	6,864,408	(34,501,922)
Income tax provision (benefit)
Deferred	3,063,832	(6,906,257)
Total income tax provision (benefit)	3,063,832	(6,906,257)
Net income (loss)	$ 3,800,576	$ (27,595,665)
Weighted average common shares outstanding
Basic	50,016,022	42,655,280
Diluted	50,085,289	42,655,280
Class A [Member]
Earnings (loss) per common share
Basic	$ 0.08	$ (0.65)
Diluted	$ 0.08	$ (0.65)
Weighted average common shares outstanding
Basic	49,596,946	41,624,580
Diluted	49,666,213	41,624,580
Class B [Member]
Earnings (loss) per common share
Basic	$ 0.15	$ (0.58)
Diluted	$ 0.15	$ (0.58)
Weighted average common shares outstanding
Basic	419,076	1,030,700
Diluted	419,076	1,030,700

Condensed Consolidated Statements Of Shareholders' Equity - 3 months ended Mar. 31, 2012 - USD ($)	Class A [Member] Common Stock [Member]	Class A [Member]	Class B [Member] Common Stock [Member]	Class B [Member]	Additional Paid-In Capital [Member]	Retained Earnings [Member]	Treasury Stock [Member]	Total
Balance at Dec. 31, 2011	$ 429,166		$ 10,307		$ 263,561,890	$ 18,278,652	$ (10,764,822)	$ 271,515,193
Balance, shares at Dec. 31, 2011	42,916,668	41,737,493	1,030,700	1,030,700			(1,179,175)
Issuance of Class A common stock	$ 122,092				146,387,912			146,510,004
Issuance of Class A common stock, shares	12,209,167
Cost to issue equity					$ (11,262,499)			$ (11,262,499)
Conversion of Class B common stock to Class A common stock	$ 10,307		$ (10,307)
Conversion of Class B common stock to Class A common stock, shares	1,030,700		(1,030,700)
Class A common stock issuable to Board members and advisors, Shares					11,020			11,020
Class A common stock issuable to Board members and advisors
Stock options expense					$ (5,524)			$ (5,524)
Stock options exercised	$ 2,955				3,541,065			3,544,020
Stock options exercised, shares	295,500
Restricted stock vested					10,970			10,970
Restricted stock vested, shares
Class B dividends declared						(27,643)		(27,643)
Current period net income						3,800,576		3,800,576
Balance at Mar. 31, 2012	$ 564,520				$ 402,244,834	$ 22,051,585	$ (10,764,822)	$ 414,096,117
Balance, shares at Mar. 31, 2012	56,452,035	55,272,860		0			(1,179,175)

Condensed Consolidated Statements Of Cash Flows - USD ($)	3 Months Ended
	Mar. 31, 2012	Mar. 31, 2011
Operating activities
Net income (loss)	$ 3,800,576	$ (27,595,665)
Adjustments to reconcile net income (loss) to net cash provided by operating activities
Unrealized loss on derivatives	3,269,652	1,668,115
Depletion, depreciation and amortization	11,205,450	7,111,211
Accretion of asset retirement obligations	52,750	39,220
Full-cost ceiling impairment		35,673,098
Stock option and grant expense	(373,372)	42,342
Restricted stock expense	10,970	11,001
Deferred income tax provision (benefit)	3,063,832	(6,906,257)
Changes in operating assets and liabilities
Accounts receivable	(8,455,502)	(1,487,670)
Prepaid expenses	(544,078)	510,035
Other assets	12,939
Accounts payable, accrued liabilities and other current liabilities	(8,563,482)	4,098,248
Royalties payable	1,341,405	416,170
Advances from joint interest owners		(722,843)
Other long-term liabilities	288,706	(125,000)
Net cash provided by operating activities	5,109,846	12,732,005
Investing activities
Oil and natural gas properties capital expenditures	(51,959,003)	(34,113,878)
Expenditures for other property and equipment	(1,413,013)	(1,180,181)
Purchases of certificates of deposit	(150,000)	(1,329,000)
Maturities of certificates of deposit	758,000	1,599,000
Net cash used in investing activities	(52,764,016)	(35,024,059)
Financing activities
Repayments of borrowings under Credit Agreement	(123,000,000)
Borrowings under Credit Agreement	25,000,000	15,000,000
Proceeds from issuance of common stock	146,510,004	591,492
Cost to issue equity	(11,329,305)	(31,877)
Proceeds from stock options exercised	2,659,500	202,500
Payment of dividends - Class B	(96,356)	(68,713)
Net cash provided by financing activities	39,743,843	15,693,402
Decrease in cash and cash equivalents	(7,910,327)	(6,598,652)
Cash and cash equivalents at beginning of period	10,284,180	21,059,519
Cash and cash equivalents at end of period	$ 2,373,853	$ 14,460,867

Nature Of Operations	3 Months Ended
Nature Of Operations	Mar. 31, 2012
Nature Of Operations [Abstract]
Nature Of Operations	NOTE 1 — NATURE OF OPERATIONS Matador Resources Company ("Matador" or the "Company") is an independent energy company engaged in the exploration, development, acquisition and production of oil and natural gas resources in the United States, with a particular emphasis on oil and natural gas shale plays and other unconventional resource plays. Matador's current operations are located primarily in the Eagle Ford shale play in south Texas and the Haynesville shale play in northwest Louisiana and east Texas. In addition to these primary operating areas, Matador has acreage positions in southeast New Mexico and west Texas and in southwest Wyoming and adjacent areas in Utah and Idaho where the Company continues to identify new oil and natural gas prospects. On November 22, 2010, the company formerly known as Matador Resources Company, a Texas corporation founded on July 3, 2003, formed a wholly-owned subsidiary, Matador Holdco, Inc. Pursuant to the terms of a corporate reorganization that was completed on August 9, 2011, the former Matador Resources Company became a wholly owned subsidiary of Matador Holdco, Inc. and changed its corporate name to MRC Energy Company, and Matador Holdco, Inc. changed its corporate name to Matador Resources Company. MRC Energy Company holds the primary assets of the Company and has four wholly owned subsidiaries: Matador Production Company, MRC Permian Company, MRC Rockies Company and Longwood Gathering and Disposal Systems GP, Inc. Matador Production Company serves as the oil and natural gas operating entity. MRC Permian Company conducts oil and natural gas exploration and development activities in southeast New Mexico. MRC Rockies Company conducts oil and natural gas exploration and development activities in the Rocky Mountains and specifically in the states of Wyoming, Utah and Idaho. Longwood Gathering and Disposal Systems GP, Inc. serves as the general partner of Longwood Gathering and Disposal Systems, LP which owns a majority of the pipeline systems and salt water disposal wells used in the Company's operations and also transports limited quantities of third-party natural gas.

Summary Of Significant Accounting Policies

3 Months Ended

Mar. 31, 2012

Summary Of Significant Accounting Policies [Abstract]

Summary Of Significant Accounting Policies

NOTE 2 — SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Interim Financial Statements, Basis of Presentation, Consolidation and Significant Estimates

The unaudited condensed consolidated financial statements of Matador and its subsidiaries have been prepared in accordance with the rules and regulations of the Securities and Exchange Commission ("SEC") but do not include all of the information and footnotes required by generally accepted accounting principles in the United States of America ("U.S. GAAP") for complete financial statements and should be read in conjunction with the Company's audited consolidated financial statements and notes thereto included in the Company's Annual Report on Form 10-K for the year ended December 31, 2011 filed with the SEC. All intercompany accounts and transactions have been eliminated in consolidation. In management's opinion, these interim unaudited condensed consolidated financial statements include all adjustments of a normal recurring nature necessary for a fair presentation of the Company's consolidated financial position as of March 31, 2012, consolidated results of operations for the three months ended March 31, 2012 and 2011, consolidated shareholders' equity for the three months ended March 31, 2012 and consolidated cash flows for the three months ended March 31, 2012 and 2011. Certain reclassifications have been made to prior period items to conform to the current period presentation. These reclassifications had no effect on previously reported results of operations, cash flows or retained earnings. Amounts as of December 31, 2011 are derived from the audited consolidated financial statements as filed with the SEC in our Annual Report on Form 10-K for the year ended December 31, 2011.

Accounting measurements at interim dates inherently involve greater reliance on estimates than at year end and the results for the interim periods shown in this report are not necessarily indicative of results to be expected for the full year due in part to volatility in oil and natural gas prices, global economic and financial market conditions, interest rates, access to sources of liquidity, estimates of reserves, drilling risks, geological risks, transportation restrictions, oil and natural gas supply and demand, market competition and interruptions of production.

The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. These estimates and assumptions may also affect 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. The Company's consolidated financial statements are based on a number of significant estimates, including accruals for oil and natural gas revenues, accrued assets and liabilities primarily related to oil and natural gas operations, stock-based compensation, valuation of derivative instruments and oil and natural gas reserves. The estimates of oil and natural gas reserves quantities and future net cash flows are the basis for the calculations of depletion and impairment of oil and natural gas properties, as well as estimates of asset retirement obligations and certain tax accruals. While the Company believes its estimates are reasonable, changes in facts and assumptions or the discovery of new information may result in revised estimates. Actual results could differ from these estimates.

Property and Equipment

The Company uses the full-cost method of accounting for its investments in oil and natural gas properties. Under this method of accounting, all costs associated with the acquisition, exploration and development of oil and natural gas properties and reserves, including unproved and unevaluated property costs, are capitalized as incurred and accumulated in a single cost center representing the Company's activities, which are undertaken exclusively in the United States. Such costs include lease acquisition costs, geological and geophysical expenditures, lease rentals on undeveloped properties, costs of drilling both productive and non-productive wells, capitalized interest on qualifying projects and general and administrative expenses directly related to exploration and development activities, but do not include any costs related to production, selling or general corporate administrative activities. The Company capitalized $516,207 and $501,519 of its general and administrative costs for the three months ended March 31, 2012 and 2011, respectively. The Company capitalized $275,728 of its interest expense for the three months ended March 31, 2012. No interest expense was capitalized during the three months ended March 31, 2011.

The net capitalized costs of oil and natural gas properties are limited to the lower of unamortized costs less related deferred income taxes or the cost center ceiling, with any excess above the cost center ceiling charged to operations as a full-cost ceiling impairment. The need for a full-cost ceiling impairment is assessed on a quarterly basis. The cost center ceiling is defined as the sum of (a) the present value discounted at 10 percent of future net revenues of proved oil and natural gas reserves, plus (b) unproved and unevaluated property costs not being amortized, plus (c) the lower of cost or estimated fair value of unproved and unevaluated properties included in the costs being amortized, if any, less (d) income tax effects related to the properties involved. Future net revenues from proved non-producing and proved undeveloped reserves are reduced by the estimated costs for developing these reserves. The fair value of the Company's derivative instruments is not included in the ceiling test computation as the Company does not designate these instruments as hedge instruments for accounting purposes.

The estimated present value of after-tax future net cash flows from proved oil and natural gas reserves is highly dependent on the commodity prices used in these estimates. These estimates are determined in accordance with guidelines established by the SEC for estimating and reporting oil and natural gas reserves. Under these guidelines, oil and natural gas reserves are estimated using then-current operating and economic conditions, with no provision for price and cost escalations in future periods except by contractual arrangements.

The commodity prices used to estimate oil and natural gas reserves are based on unweighted, arithmetic averages of first-day-of-the-month oil and natural gas prices for the previous 12-month period. For the period April 2011 through March 2012, these average oil and natural gas prices were $94.65 per Bbl and $3.731 per MMBtu (million British thermal units), respectively. For the period April 2010 through March 2011, these average oil and natural gas prices were $80.04 per Bbl and $4.102 per MMBtu. In estimating the present value of after-tax future net cash flows from proved oil and natural gas reserves, the average oil prices were adjusted by property for quality, transportation and marketing fees and regional price differentials, and the average natural gas prices were adjusted by property for energy content, transportation and marketing fees and regional price differentials. At March 31, 2012 and 2011, the Company's oil and natural gas reserves estimates were prepared by the Company's engineering staff in accordance with guidelines established by the SEC and then audited for their reasonableness and conformance with SEC guidelines by Netherland, Sewell & Associates, Inc., independent reservoir engineers.

Using the average commodity prices, as adjusted, to determine the Company's estimated proved oil and natural gas reserves at March 31, 2012, the Company's net capitalized costs less related deferred income taxes did not exceed the full-cost ceiling. As a result, the Company recorded no impairment to its net capitalized costs for the three months ended March 31, 2012. Using the average commodity prices, as adjusted, to determine the Company's estimated proved oil and natural gas reserves at March 31, 2011, the Company's net capitalized costs less related deferred income taxes exceeded the full-cost ceiling by $22,989,866. The Company recorded an impairment charge of $35,673,098 to its net capitalized costs and a deferred income tax credit of $12,683,232 related to the full-cost ceiling limitation at March 31, 2011. Corresponding charges were also recorded to the Company's unaudited condensed consolidated statement of operations for the three months ended March 31, 2011.

As a non-cash item, the full-cost ceiling impairment impacts the accumulated depletion and the net carrying value of the Company's assets on its balance sheet, as well as the corresponding shareholders' equity, but it has no impact on the Company's net cash flows as reported.

Capitalized costs of oil and natural gas properties are amortized using the unit-of-production method based upon production and estimates of proved reserves quantities. Unproved and unevaluated property costs are excluded from the amortization base used to determine depletion. Unproved and unevaluated properties are assessed for possible impairment on a periodic basis based upon changes in operating or economic conditions. This assessment includes consideration of the following factors, among others: the assignment of proved reserves, geological and geophysical evaluations, intent to drill, remaining lease term and drilling activity and results. Upon impairment, the costs of the unproved and unevaluated properties are immediately included in the amortization base. Dry holes are included in the amortization base immediately upon determination that the well is not productive.

Earnings Per Common Share

The Company reports basic earnings per common share, which excludes the effect of potentially dilutive securities, and diluted earnings per common share, which includes the effect of all potentially dilutive securities, unless their impact is anti-dilutive.

Prior to the consummation of the Company's Initial Public Offering (see Note 7) in February 2012, the Company had issued two classes of common stock, Class A and Class B. The holders of the Class B shares were entitled to be paid cumulative dividends at a per share rate of $0.26-2/3 annually out of funds legally available for the payment of dividends. These dividends were accrued and paid quarterly. Dividends declared during the three months ended March 31, 2012 and 2011 totaled $27,643 and $68,713, respectively. Class B dividends declared during the fourth quarter of 2011 and the first quarter of 2012 were paid during the first quarter of 2012 totaling $96,356. As of March 31, 2012, the Company had not paid any dividends to holders of the Class A shares. Concurrent with the completion of the Initial Public Offering, all 1,030,700 shares of the Company's Class B common stock were converted to Class A common stock on a one-for-one basis. The Class A common stock is now referred to as the common stock.

The following are reconciliations of the numerators and denominators used to compute the Company's basic and diluted distributed and undistributed earnings (loss) per common share as reported for the three months ended March 31, 2012 and 2011.


	Three Months Ended March 31,
	2012			2011
Net income (loss) — numerator
Net income (loss)	$	3,800,576		$	(27,595,665	)
Less dividends to Class B shareholders — Distributed earnings		(27,643	)		(68,713	)

Undistributed earnings (loss)	$	3,772,933		$	(27,664,378	)

Weighted average common shares outstanding — denominator
Basic
Class A		49,596,946			41,624,580
Class B		419,076			1,030,700

Total		50,016,022			42,655,280

Diluted
Class A
Weighted average common shares outstanding for basic earnings (loss) per share		49,596,946			41,624,580
Dilutive effect of options		69,267			—

Class A weighted average common shares outstanding – diluted		49,666,213			41,624,580
Class B
Weighted average common shares outstanding – no associated dilutive shares		419,076			1,030,700

Total diluted weighted average common shares outstanding		50,085,289			42,655,280


	Three Months Ended March 31,
	2012		2011
Earnings (loss) per common share
Basic
Class A
Distributed earnings	$	—	$	—
Undistributed earnings (loss)	$	0.08	$	(0.65	)

Total	$	0.08	$	(0.65	)

Class B
Distributed earnings	$	0.07	$	0.07
Undistributed earnings (loss)	$	0.08	$	(0.65	)

Total	$	0.15	$	(0.58	)

Diluted
Class A
Distributed earnings	$	—	$	—
Undistributed earnings (loss)	$	0.08	$	(0.65	)

Total	$	0.08	$	(0.65	)

Class B
Distributed earnings	$	0.07	$	0.07
Undistributed earnings (loss)	$	0.08	$	(0.65	)

Total	$	0.15	$	(0.58	)

A total of 1,178,500 options to purchase shares of the Company's Class A common stock were excluded from the calculations above for the three months ended March 31, 2011 because their effects were anti-dilutive.

Fair Value Measurements

The Company measures and reports certain assets and liabilities on a fair value basis. Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date (exit price). The Company follows Financial Accounting Standards Board ("FASB") guidance establishing a fair value hierarchy that prioritizes the inputs to valuation methods used to measure fair value.

Recent Accounting Pronouncements

Balance Sheet. In December 2011, the FASB issued Accounting Standards Update, or ASU, 2011-11, Balance Sheet. The requirements amend the disclosure requirements related to offsetting in Accounting Standards Codification, or ASC, 210-20-50. The amendments require enhanced disclosures by requiring improved information about financial instruments and derivative instruments that are either (1) offset in accordance with either ASC 210-20-45 or ASC 815-10-45 or (2) subject to an enforceable master netting arrangement or similar agreement, irrespective of whether they are offset in accordance with either ASC 210-20-45 or ASC 815-10-45. The adoption of ASU 2011-11 is not expected to have a material effect on the Company's consolidated financial statements, but may require certain additional disclosures. The amendments in ASU 2011-11 are to be applied for annual reporting periods beginning on or after January 1, 2013 and are to be applied retrospectively for all periods presented.

Fair Value. In May 2011, the FASB issued ASU 2011-04, Amendments to Achieve Common Fair Value Measurement and Disclosure Requirements in U.S. GAAP and IFRS. ASU 2011-04 amends ASC 820 Fair Value Measurements, providing a consistent definition and measurement of fair value, as well as similar disclosure requirements between U.S. GAAP and International Financial Reporting Standards. ASU 2011-04 changes certain fair value measurement principles, clarifies the application of existing fair value measurements and expands the ASC 820 disclosure requirements, particularly for Level 3 fair value measurements. ASU 2011-04 is effective for interim and annual periods beginning after December 15, 2011. The Company adopted ASU 2011-04 on January 1, 2012; adoption did not have a material effect on the Company's consolidated financial statements, but did require additional disclosures (see Note 9).

Asset Retirement Obligations

3 Months Ended

Mar. 31, 2012

Asset Retirement Obligations [Abstract]

Asset Retirement Obligations

NOTE 3 — ASSET RETIREMENT OBLIGATIONS

The following table summarizes the changes in the Company's asset retirement obligations for the three months ended March 31, 2012.


Beginning asset retirement obligations	$	4,269,584
Liabilities incurred during period		152,953
Liabilities settled during period		—
Accretion expense		52,750

Ending asset retirement obligations	$	4,475,287

At March 31, 2012, $338,917 of the Company's asset retirement obligations were classified as current liabilities and included in "accrued liabilities" in the Company's unaudited condensed consolidated balance sheet.

Revolving Credit Agreement

3 Months Ended

Mar. 31, 2012

Revolving Credit Agreement [Abstract]

Revolving Credit Agreement

NOTE 4 — REVOLVING CREDIT AGREEMENT

In December 2011, the Company amended and restated its senior secured revolving credit agreement ("Credit Agreement") for which Comerica Bank serves as administrative agent. This amendment increased the maximum facility amount from $150,000,000 to $400,000,000. Borrowings under the Credit Agreement are limited to the lesser of $400,000,000 or the borrowing base. At March 31, 2012, the borrowing base was $125,000,000. The Credit Agreement matures in December 2016.

MRC Energy Company is the borrower under the Credit Agreement and borrowings are secured by mortgages on substantially all of the Company's oil and natural gas properties and by the equity interests of all of MRC Energy Company's wholly owned subsidiaries, which are also guarantors. In addition, all obligations under the Credit Agreement are guaranteed by Matador Resources Company, the parent corporation. Various commodity hedging agreements with Comerica Bank (or an affiliate thereof) are also secured by the collateral and guaranteed by the subsidiaries of MRC Energy Company.

The borrowing base under the Credit Agreement is determined semi-annually as of May 1 and November 1 by the lenders based primarily on the estimated value of the Company's proved oil and natural gas reserves, but also on external factors, such as the lenders' lending policies and the lenders' estimates of future oil and natural gas prices, over which the Company has no control. At December 31, 2011, the borrowing base was $125,000,000 and we had $113,000,000 in outstanding borrowings under the Credit Agreement. In January 2012, the Company borrowed an additional $10,000,000 to finance a portion of its working capital requirements and capital expenditures, bringing the then outstanding revolving borrowings under the Credit Agreement to $123,000,000. Following the completion of the Initial Public Offering in February 2012, the Company used a portion of the net proceeds to repay the then outstanding $123,000,000 under the Credit Agreement in full, at which time the borrowing base was reduced to $100,000,000. On February 28, 2012, the borrowing base was increased to $125,000,000 pursuant to a special borrowing base redetermination made at the Company's request. The borrowing base increase was determined by the lenders based upon, among other items, the increase in the Company's proved oil and natural gas reserves at December 31, 2011.

In March 2012, the Company borrowed $15,000,000 under the Credit Agreement to finance a portion of its working capital requirements and capital expenditures. At March 31, 2012, the Company had $15,000,000 in borrowings outstanding under the Credit Agreement, approximately $1,300,000 in outstanding letters of credit issued pursuant to the Credit Agreement and approximately $108,700,000 available for additional borrowings. At March 31, 2012, the Company's outstanding borrowings bore interest at approximately 2.0% per annum.

Both the Company and the lenders may each request an unscheduled redetermination of the borrowing base twice at any time during the first year of the Credit Agreement and once between scheduled redetermination dates thereafter. We requested one such unscheduled redetermination in February 2012. In the event of a borrowing base increase, the Company is required to pay a fee to the lenders equal to a percentage of the amount of the increase, which will be determined based on market conditions at the time of the borrowing base increase. If the borrowing base were to be less than the outstanding borrowings under the Credit Agreement at any time, the Company would be required to provide additional collateral satisfactory in nature and value to the lenders to increase the borrowing base to an amount sufficient to cover such excess or to repay the deficit in equal installments over a period of six months.

If the Company borrows funds as a base rate loan, such borrowings will bear interest at a rate equal to the higher of (i) the weighted average of rates used in overnight federal funds transactions with members of the Federal Reserve System plus 1.0% or (ii) the prime rate for Comerica Bank then in effect or (iii) a daily adjusted LIBOR rate plus 1.0% plus, in each case, an amount from 0.375% to 1.75% of such outstanding loan depending on the level of borrowings under the agreement. If the Company borrows funds as a Eurodollar loan, such borrowings will bear interest at a rate equal to (i) the quotient obtained by dividing (A) the interest rate appearing on Page BBAM of the Bloomberg Financial Markets Information Service by (B) a percentage equal to 100% minus the maximum rate during such interest calculation period at which Comerica Bank is required to maintain reserves on Eurocurrency Liabilities (as defined in Regulation D of the Board of Governors of the Federal Reserve System), plus (ii) an amount from 1.375% to 2.75% of such outstanding loan depending on the level of borrowings under the agreement. The interest period for Eurodollar borrowings may be one, two, three or six months as designated by the Company. A facility fee of 0.375% to 0.50%, depending on the amounts borrowed, is also paid quarterly in arrears. The Company includes this facility fee in its interest rate calculations and related disclosures.

Key financial covenants under the Credit Agreement require us to maintain (1) a current ratio, which is defined as consolidated total current assets plus the unused availability under the Credit Agreement divided by consolidated total current liabilities, of 1.0 or greater measured at the end of each fiscal quarter beginning March 31, 2012, and (2) a debt to EBITDA ratio, which is defined as total debt outstanding divided by a rolling four quarter EBITDA calculation, of 4.0 or less.

Subject to certain exceptions, the Credit Agreement contains various covenants that limit the Company's, along with its subsidiaries', ability to take certain actions, including, but not limited to, the following:

•

incur indebtedness or grant liens on any of its assets;

•

enter into commodity hedging agreements;

•

declare or pay dividends, distributions or redemptions;

•

merge or consolidate;

•

make any loans or investments;

•

engage in transactions with affiliates; and

•

engage in certain asset dispositions, including a sale of all or substantially all of the Company's assets.

If an event of default exists under the Credit Agreement, the lenders will be able to accelerate the maturity of the borrowings and exercise other rights and remedies. Events of default include, but are not limited to, the following events:

•

failure to pay any principal or interest on the notes or any reimbursement obligation under any letter of credit when due or any fees or other amount within certain grace periods;

•

failure to perform or otherwise comply with the covenants and obligations in the Credit Agreement or other loan documents, subject, in certain instances, to certain grace periods;

•

bankruptcy or insolvency events involving the Company or its subsidiaries; and

•

a change of control, as defined in the Credit Agreement.

At March 31, 2012, the Company believes that it was in compliance with the terms of the Credit Agreement. We obtained a written extension until May 1, 2012 to comply with a covenant under the Credit Agreement requiring the submission of certain year-end 2011 operating information on or before March 1, 2012. We subsequently furnished this information to the lenders prior to May 1, 2012.

- Definition

The entire disclosure for information about short-term and long-term debt arrangements, which includes amounts of borrowings under each line of credit, note payable, commercial paper issue, bonds indenture, debenture issue, own-share lending arrangements and any other contractual agreement to repay funds, and about the underlying arrangements, rationale for a classification as long-term, including repayment terms, interest rates, collateral provided, restrictions on use of assets and activities, whether or not in compliance with debt covenants, and other matters important to users of the financial statements, such as the effects of refinancing and noncompliance with debt covenants.

+ References + Details

Income Taxes	3 Months Ended
Income Taxes	Mar. 31, 2012
Income Taxes [Abstract]
Income Taxes	NOTE 5 — INCOME TAXES The Company had an effective income tax rate of 44.6% for the three months ended March 31, 2012. Total income tax expense for the three months ended March 31, 2012 differed from amounts computed by applying the U.S. statutory tax rates to income taxes due primarily to state taxes and the impact of an adjustment to the estimated permanent differences between book and taxable income related to stock compensation expense in prior periods. The Company had a net loss for the three months ended March 31, 2011. The adjustment noted above resulted in a charge to deferred tax assets and additional deferred income taxes of $721,005. Although the amount may be considered material to the financial results for the three months ended March 31, 2012, management does not believe that recording the adjustment in the current period will have a material effect on the financial results for the year ended December 31, 2012.

- Definition

The entire disclosure for income taxes. Disclosures may include net deferred tax liability or asset recognized in an enterprise's statement of financial position, net change during the year in the total valuation allowance, approximate tax effect of each type of temporary difference and carryforward that gives rise to a significant portion of deferred tax liabilities and deferred tax assets, utilization of a tax carryback, and tax uncertainties information.

+ References

Reference 1: http://www.xbrl.org/2003/role/presentationRef
-Publisher SEC
-Name Regulation S-X (SX)
-Number 210
-Section 08
-Paragraph h
-Article 4

Reference 2: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Statement of Financial Accounting Standard (FAS)
-Number 109
-Paragraph 136, 172
-LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy.

Reference 3: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Statement of Financial Accounting Standard (FAS)
-Number 109
-Paragraph 43, 44, 45, 46, 47, 48, 49
-LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy.

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-Topic 235
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-Paragraph 1
-Subparagraph (SX 210.4-08.(h))
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+ Details

Stock-Based Compensation	3 Months Ended
Stock-Based Compensation	Mar. 31, 2012
Stock-Based Compensation [Abstract]
Stock-Based Compensation	NOTE 6 — STOCK-BASED COMPENSATION Effective January 1, 2012, the Board of Directors adopted the 2012 Long-Term Incentive Plan (the "2012 Incentive Plan"). The 2012 Incentive Plan provides for a maximum of 4,000,000 shares of common stock in the aggregate that may be issued by the Company pursuant to grants of stock options, restricted stock, stock appreciation rights, restricted stock units and other performance awards. The persons eligible to receive awards under the 2012 Incentive Plan include employees, contractors and outside directors of the Company. The primary purpose of the 2012 Incentive Plan is to attract and retain key employees, key contractors and outside directors of the Company. During the three months ended March 31, 2012, the Company granted one of its executive officers the option to purchase 150,000 shares of its common stock at $12.00 per share. The award was classified as an equity award and the total grant date fair value of the option was approximately $1,054,000 which will be expensed over a service period of approximately three years. The Company recognized approximately $70,000 in stock-based compensation expense related to this grant during the three months ended March 31, 2012.

- Definition

The entire disclosure for compensation-related costs for equity-based compensation, which may include disclosure of policies, compensation plan details, allocation of equity compensation, incentive distributions, equity-based arrangements to obtain goods and services, deferred compensation arrangements, employee stock ownership plan details and employee stock purchase plan details.

+ References

Reference 1: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Statement of Financial Accounting Standard (FAS)
-Number 123R
-Paragraph 64, 65, A240
-LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy.

Reference 2: http://www.xbrl.org/2003/role/presentationRef
-Publisher AICPA
-Name Statement of Position (SOP)
-Number 93-6
-Paragraph 53
-LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy.

Reference 3: http://www.xbrl.org/2003/role/presentationRef
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-Name Staff Accounting Bulletin (SAB)
-Number Topic 14

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-URI http://asc.fasb.org/extlink&oid=6418621&loc=d3e17540-113929

+ Details

Common Stock	3 Months Ended
Common Stock	Mar. 31, 2012
Common Stock [Abstract]
Common Stock	NOTE 7 — COMMON STOCK On August 12, 2011, the Company filed a Form S-1 Registration Statement under the Securities Act of 1933 to commence the initial public offering of its common stock (the "Initial Public Offering"). The Company's Registration Statement (File 333-176263), as amended, was declared effective by the SEC on February 1, 2012. The underwriters for the Company's Initial Public Offering were RBC Capital Markets, LLC; Citigroup Global Markets, Inc.; Jefferies & Company, Inc.; Howard Weil Incorporated; Stifel, Nicolaus & Company, Incorporated; Simmons & Company International; Stephens Inc.; and Comerica Securities, Inc. On February 2, 2012, shares of the Company's common stock began trading on the New York Stock Exchange under the symbol "MTDR" at an initial offering price of $12.00 per share. Pursuant to its Prospectus dated February 1, 2012, the Company and the selling shareholders offered 13,333,334 shares of the Company's common stock for sale. The Company offered 11,666,667 shares of its common stock, and the selling shareholders offered 1,666,667 shares. On February 7, 2012, the Company closed the Initial Public Offering and issued 11,666,667 shares of its common stock pursuant to the Initial Public Offering. The Company and the selling shareholders granted the underwriters the right to purchase up to an additional 2,000,000 shares of the Company's common stock at the initial offering price of $12.00 per share, less the underwriters' discounts and commissions, for a period of 30 days following the Initial Public Offering to cover over-allotments, with the Company offering 700,000 shares and the selling shareholders offering 1,300,000 shares. On March 2, 2012, the underwriters exercised their option to purchase an additional 1,550,000 shares, including the purchase of 542,500 shares from the Company and the purchase of 1,007,500 shares from the selling shareholders. On March 7, 2012, the Company closed this transaction and issued 542,500 shares of its common stock pursuant to the underwriters' exercise of the over-allotment. Pursuant to the Initial Public Offering and the over-allotment, the Company issued a total of 12,209,167 shares of its common stock at $12.00 per share. The Company received cash proceeds of approximately $136,600,000 from this transaction, net of underwriting discounts and commissions. The Company did not receive any proceeds from the sale of shares of its common stock by the selling shareholders. The underwriters received underwriting discounts and commissions totaling approximately $9,900,000, and the Company incurred additional costs of approximately $3,500,000 in connection with the offering, which amounted to total fees and costs of approximately $13,400,000, of which approximately $2,100,000 was incurred in a prior period. On February 8, 2012, the Company used a portion of the net proceeds of the offering to repay the $123,000,000 in borrowings then outstanding under its Credit Agreement in full. The Company used the remaining net proceeds of the offering to fund a portion of its 2012 capital expenditures. Concurrent with the completion of the Initial Public Offering, all 1,030,700 shares of the Company's Class B common stock were converted to Class A common stock on a one-for-one basis. In addition, in February 2012, the Company issued an additional 295,500 shares of its Class A common stock pursuant to the exercise of stock options and received net proceeds of $2,659,500. The Class A common stock is now referred to as the common stock.

- Definition

The entire disclosure for shareholders' equity, comprised of portions attributable to the parent entity and noncontrolling interest, if any, including other comprehensive income (as applicable). Including, but not limited to: (1) balances of common stock, preferred stock, additional paid-in capital, other capital and retained earnings; (2) accumulated balance for each classification of other comprehensive income and total amount of comprehensive income; (3) amount and nature of changes in separate accounts, including the number of shares authorized and outstanding, number of shares issued upon exercise and conversion, and for other comprehensive income, the adjustments for reclassifications to net income; (4) rights and privileges of each class of stock authorized; (5) basis of treasury stock, if other than cost, and amounts paid and accounting treatment for treasury stock purchased significantly in excess of market; (6) dividends paid or payable per share and in the aggregate for each class of stock for each period presented; (7) dividend restrictions and accumulated preferred dividends in arrears (in aggregate and per share amount); (8) retained earnings appropriations or restrictions, such as dividend restrictions; (9) impact of change in accounting principle, initial adoption of new accounting principle and correction of an error in previously issued financial statements; (10) shares held in trust for Employee Stock Ownership Plan (ESOP); (11) deferred compensation related to issuance of capital stock; (12) note received for issuance of stock; (13) unamortized discount on shares; (14) description, terms, and number of warrants or rights outstanding; (15) shares under subscription and subscription receivables, effective date of new retained earnings after quasi-reorganization and deficit eliminated by quasi-reorganization and, for a period of at least ten years after the effective date, the point in time from which the new retained dates; and (16) retroactive effective of subsequent change in capital structure.

+ References

Reference 1: http://www.xbrl.org/2003/role/presentationRef
-Publisher AICPA
-Name Accounting Principles Board Opinion (APB)
-Number 12
-Paragraph 10
-LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy.

Reference 2: http://www.xbrl.org/2003/role/presentationRef
-Publisher SEC
-Name Regulation S-X (SX)
-Number 210
-Section 04
-Article 3

Reference 3: http://www.xbrl.org/2003/role/presentationRef
-Publisher SEC
-Name Regulation S-X (SX)
-Number 210
-Article 4
-Section 08
-Paragraph d

Reference 4: http://www.xbrl.org/2003/role/presentationRef
-Publisher AICPA
-Name Accounting Research Bulletin (ARB)
-Number 43
-Chapter 1
-Section B
-Paragraph 7, 11A
-LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy.

Reference 5: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Statement of Financial Accounting Standard (FAS)
-Number 129
-Paragraph 2, 3, 4, 5, 6, 7, 8
-LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy.

Reference 6: http://www.xbrl.org/2003/role/presentationRef
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-Name Regulation S-X (SX)
-Number 210
-Section 08
-Article 4

Reference 7: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Statement of Financial Accounting Standard (FAS)
-Number 5
-Paragraph 15
-LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy.

Reference 8: http://www.xbrl.org/2003/role/presentationRef
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-Name Regulation S-X (SX)
-Number 210
-Section 02
-Paragraph 29, 30, 31
-Article 5

Reference 9: http://www.xbrl.org/2003/role/presentationRef
-Publisher SEC
-Name Staff Accounting Bulletin (SAB)
-Number Topic 4
-Section E

Reference 10: http://www.xbrl.org/2003/role/presentationRef
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-Name Staff Accounting Bulletin (SAB)
-Number Topic 4
-Section C

Reference 11: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
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-Section S99
-Paragraph 1
-Subparagraph (SX 210.3-04)
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-URI http://asc.fasb.org/extlink&oid=6521494

Reference 22: http://www.xbrl.org/2003/role/presentationRef
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+ Details

Derivative Financial Instruments

3 Months Ended

Mar. 31, 2012

Derivative Financial Instruments [Abstract]

Derivative Financial Instruments

NOTE 8 — DERIVATIVE FINANCIAL INSTRUMENTS

From time to time, the Company uses derivative financial instruments to mitigate its exposure to commodity price risk associated with oil and natural gas prices. These instruments consist of put and call options in the form of costless collars. The Company records derivative financial instruments on its balance sheet as either an asset or a liability measured at fair value. The Company has elected not to apply hedge accounting for its existing derivative financial instruments. As a result, the Company recognizes the change in derivative fair value between reporting periods currently in its consolidated statement of operations as an unrealized gain or loss. The fair value of the Company's derivative financial instruments is determined using purchase and sale information available for similarly traded securities. The Company has evaluated the credit standing of its single counterparty, Comerica Bank, in determining the fair value of these derivative financial instruments.

The Company has entered into various costless collar contracts to mitigate its exposure to fluctuations in oil prices, each with an established price floor and ceiling. For each calculation period, the specified price for determining the realized gain or loss pursuant to any of these transactions is the arithmetic average of the settlement prices for the NYMEX West Texas Intermediate oil futures contract for the first nearby month corresponding to the calculation period's calendar month. When the settlement price is below the price floor established by these collars, the Company receives from Comerica Bank, as counterparty, an amount equal to the difference between the settlement price and the price floor multiplied by the contract oil volume. When the settlement price is above the price ceiling established by these collars, the Company pays to Comerica, as counterparty, an amount equal to the difference between the settlement price and the price ceiling multiplied by the contract oil volume.

The Company has entered into various costless collar transactions for natural gas, each with an established price floor and ceiling. For each calculation period, the specified price for determining the realized gain or loss to the Company pursuant to any of these transactions is the settlement price for the NYMEX Henry Hub natural gas futures contract for the delivery month corresponding to the calculation period's calendar month for the last day of that contract period. When the settlement price is below the price floor established by these collars, the Company receives from Comerica Bank, as counterparty, an amount equal to the difference between the settlement price and the price floor multiplied by the contract natural gas volume. When the settlement price is above the price ceiling established by these collars, the Company pays to Comerica, as counterparty, an amount equal to the difference between the settlement price and the price ceiling multiplied by the contract natural gas volume.

At March 31, 2012, the Company had multiple costless collar contracts open and in place to mitigate its exposure to oil and natural gas price volatility, each with a specific term (calculation period), notional quantity (volume hedged) and price floor and ceiling. Each contract is set to expire at varying times during 2012, 2013 and 2014.

The following is a summary of the Company's open costless collar contracts for oil and natural gas at March 31, 2012.


Commodity	Calculation Period	Notional Quantity (Bbl/month)		Price Floor ($/Bbl)		Price Ceiling ($/Bbl)		Fair Value of Asset (Liability)
Oil	04/01/2012 – 12/31/2012		20,000		90.00		104.20	$	(854,699	)
Oil	04/01/2012 – 12/31/2012		10,000		90.00		108.00		(255,085	)
Oil	04/01/2012 – 12/31/2012		10,000		90.00		109.50		(205,318	)
Oil	04/01/2012 – 06/30/2012		20,000		90.00		113.75		(18,545	)
Oil	04/01/2012 – 12/31/2012		20,000		90.00		111.00		(320,596	)
Oil	04/01/2012 – 03/31/2013		20,000		90.00		110.00		(542,988	)
Oil	07/01/2012 – 12/31/2012		20,000		90.00		111.90		(237,974	)
Oil	07/01/2012 – 12/31/2012		20,000		95.00		116.00		62,891
Oil	01/01/2013 – 12/31/2013		20,000		85.00		102.25		(1,735,790	)
Oil	01/01/2013 – 12/31/2013		20,000		90.00		115.00		(82,408	)
Oil	01/01/2013 – 12/31/2013		20,000		85.00		110.40		(816,436	)
Oil	01/01/2013 – 12/31/2013		20,000		85.00		108.80		(904,064	)
Oil	01/01/2013 – 06/30/2014		8,000		90.00		114.00		(2,101	)
Oil	01/01/2013 – 06/30/2014		12,000		90.00		115.50		99,629

Total Oil									(5,813,484	)


Commodity	Calculation Period	Notional Quantity (MMBtu/month)		Price Floor ($/MMBtu)		Price Ceiling ($/MMBtu)		Fair Value of Asset (Liability)
Natural Gas	04/01/2012 – 12/31/2012		300,000		4.50		5.60		5,430,640
Natural Gas	04/01/2012 – 07/31/2013		150,000		4.50		5.75		4,005,490
Natural Gas	04/01/2012 – 12/31/2012		150,000		4.25		6.17		2,389,635

Total Natural Gas									11,825,765

Total open costless collar contracts								$	6,012,281

The following table summarizes the location and aggregate fair value of all derivative financial instruments recorded in the consolidated balance sheets for the periods presented. These derivative financial instruments are not designated as hedging instruments.

	$(0,000,000		$(0,000,000			$(0,000,000
Type of Instrument	Location in Balance Sheet	March 31, 2012			December 31, 2011
Derivative Instrument
Oil	Current liabilities: Derivative instruments	$	(3,089,211	)	$	(171,252	)
Oil	Long-term liabilities: Derivative instruments		(2,724,273	)		(382,848	)
Natural Gas	Current assets: Derivative instruments		10,908,380			8,988,767
Natural Gas	Other assets: Derivative instruments		917,385			847,267

Total		$	6,012,281		$	9,281,934

The following table summarizes the location and aggregate fair value of all derivative financial instruments recorded in the consolidated statements of operations for the periods presented. These derivative financial instruments are not designated as hedging instruments.

	$(0,000,000		$(0,000,000			$(0,000,000
		Three Months Ended March 31,
Type of Instrument	Location in Statement of Operations	2012			2011
Derivative Instrument
Natural Gas	Revenues: Realized gain on derivatives	$	3,062,700		$	1,849,750

Realized gain on derivatives			3,062,700			1,849,750
Oil	Revenues: Unrealized loss on derivatives		(5,259,384	)		—
Natural Gas	Revenues: Unrealized gain (loss) on derivatives		1,989,732			(1,668,115	)

Unrealized loss on derivatives			(3,269,652	)		(1,668,115	)

Total		$	(206,952	)	$	181,635

- Definition

The entire disclosure for the entity's entire derivative instruments and hedging activities. Describes an entity's risk management strategies, derivatives in hedging activities and non-hedging derivative instruments, the assets, obligations, liabilities, revenues and expenses arising therefrom, and the amounts of and methodologies and assumptions used in determining the amounts of such items.

+ References

Reference 1: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Statement of Financial Accounting Standard (FAS)
-Number 133
-Paragraph 45
-LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy.

Reference 2: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Statement of Financial Accounting Standard (FAS)
-Number 133
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-LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy.

Reference 3: http://www.xbrl.org/2003/role/presentationRef
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Reference 15: http://www.xbrl.org/2003/role/presentationRef
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Reference 19: http://www.xbrl.org/2003/role/presentationRef
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-Publisher FASB
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+ Details

Fair Value Measurements

3 Months Ended

Mar. 31, 2012

Fair Value Measurements [Abstract]

Fair Value Measurements

NOTE 9 — FAIR VALUE MEASUREMENTS

The Company measures and reports certain financial and non-financial assets and liabilities on a fair value basis. Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date (exit price). Fair value measurements are classified and disclosed in one of the following categories.

Level 1

Unadjusted quoted prices in active markets that are accessible at the measurement date for identical, unrestricted assets or liabilities. 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

Quoted prices in markets that are not active, or inputs which are observable, either directly or indirectly, for substantially the full term of the asset or liability. This category includes those derivative instruments that are valued using observable market data. Substantially all of these inputs are observable in the marketplace throughout the full term of the derivative instrument, can be derived from observable data or supported by observable levels at which transactions are executed in the marketplace.

Level 3

Unobservable inputs that are not corroborated by market data. This category is comprised of financial and non-financial assets and liabilities whose fair value is estimated based on internally developed models or methodologies using significant inputs that are generally less readily observable from objective sources.

Financial and non-financial assets and liabilities are classified based on the lowest level of input that is significant to the fair value measurement. The assessment of the significance of a particular input to the fair value measurement requires judgment, which may affect the valuation of the fair value of assets and liabilities and their placement within the fair value hierarchy levels.

At March 31, 2012 and December 31, 2011, the carrying values reported on the consolidated balance sheets for cash and cash equivalents, accounts receivable, prepaid expenses, accounts payable, accrued liabilities, royalties payable and other current liabilities approximate their fair values due to their short-term maturities and are classified at Level 1.

At March 31, 2012 and December 31, 2011, the carrying value of borrowings under the Credit Agreement approximates fair value as it is subject to short-term floating interest rates that reflect market rates available to the Company at the time and is classified at Level 2.

The following tables summarize the valuation of the Company's financial assets and liabilities that were accounted for at fair value on a recurring basis in accordance with the classifications provided above as of March 31, 2012 and December 31, 2011.


Description	Fair Value Measurements at March 31, 2012 using
	Level 1		Level 2			Level 3		Total
Assets (Liabilities)
Certificates of deposit	$	—	$	727,000		$	—	$	727,000
Oil and natural gas derivatives		—		11,825,765			—		11,825,765
Oil and natural gas derivatives		—		(5,813,484	)		—		(5,813,484	)

Total	$	—	$	6,739,281		$	—	$	6,739,281


Description	Fair Value Measurements at December 31, 2011 using
	Level 1		Level 2			Level 3		Total
Assets (Liabilities)
Certificates of deposit	$	—	$	1,335,000		$	—	$	1,335,000
Oil and natural gas derivatives		—		9,836,034			—		9,836,034
Oil and natural gas derivatives		—		(554,100	)		—		(554,100	)

Total	$	—	$	10,616,934		$	—	$	10,616,934

Additional disclosures related to derivative financial instruments are provided in Note 8. For purposes of fair value measurement, the Company determined that certificates of deposit and derivative financial instruments (e.g., oil and natural gas derivatives) should be classified at Level 2.

The Company accounts for additions to asset retirement obligations and lease and well equipment inventory at fair value on a non-recurring basis. The following tables summarize the valuation of the Company's assets and liabilities that were accounted for at fair value on a non-recurring basis for the periods ended March 31, 2012 and December 31, 2011.


Description	Fair Value Measurements for the period ended March 31, 2012 using
	Level 1		Level 2		Level 3			Total
Assets (Liabilities)
Asset retirement obligations	$	—	$	—	$	(152,953	)	$	(152,953	)

Total	$	—	$	—	$	(152,953	)	$	(152,953	)


Description	Fair Value Measurements for the period ended December 31, 2011 using
	Level 1		Level 2		Level 3			Total
Assets (Liabilities)
Asset retirement obligations	$	—	$	—	$	(186,873	)	$	(186,873	)
Lease and well equipment inventory		—		—		1,343,416			1,343,416

Total	$	—	$	—	$	1,156,543		$	1,156,543

For purposes of fair value measurement, the Company determined that the additions to asset retirement obligations should be classified at Level 3 when adjusted for impairment. The Company recorded additions to asset retirement obligations of $152,953 for the three months ended March 31, 2012 and $186,873 for the year ended December 31, 2011, respectively.

For purposes of fair value measurement, the Company determined that lease and well equipment inventory should be classified as Level 3. In 2011, the Company recorded an impairment to some of its equipment held in inventory consisting primarily of drilling rig parts of $17,500 and pipe and other equipment of $22,276; no impairment to any equipment was recorded for the three months ended March 31, 2012. The Company periodically obtains estimates of the market value of its equipment held in inventory from an independent third-party contractor or seller of similar equipment and uses these estimates as a basis for its measurement of the fair value of this equipment.

- Definition

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

Reference 1: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Statement of Financial Accounting Standard (FAS)
-Number 133
-Paragraph 44A, 44B
-LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy.

Reference 2: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Statement of Financial Accounting Standard (FAS)
-Number 107
-Paragraph 15C, 15D
-LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy.

Reference 3: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Statement of Financial Accounting Standard (FAS)
-Number 107
-Paragraph 15A
-Subparagraph a-d
-LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy.

Reference 4: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Statement of Financial Accounting Standard (FAS)
-Number 107
-Paragraph 15B
-Subparagraph a, b
-LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy.

Reference 5: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Statement of Financial Accounting Standard (FAS)
-Number 107
-Paragraph 3, 10, 14, 15
-LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy.

Reference 6: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Statement of Financial Accounting Standard (FAS)
-Number 157
-Paragraph 32, 33, 34
-LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy.

Reference 7: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Statement of Financial Accounting Standard (FAS)
-Number 159
-Paragraph 17-22, 27, 28
-LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy.

Reference 8: http://www.xbrl.org/2003/role/presentationRef
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-Name Accounting Standards Codification
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+ Details

Commitments And Contingencies	3 Months Ended
Commitments And Contingencies	Mar. 31, 2012
Commitments And Contingencies [Abstract]
Commitments And Contingencies	NOTE 10 — COMMITMENTS AND CONTINGENCIES Office Lease The Company's corporate headquarters are located in 28,743 square feet of office space at One Lincoln Centre, 5400 LBJ Freeway, Suite 1500, Dallas, Texas. In April 2011, the Company agreed to a restated third amendment to its office lease agreement, in which the office space was increased to 28,743 square feet and the term of the lease was extended from July 1, 2011 to June 30, 2022. The effective base rent over the term of the new lease extension is $19.75 per square foot per year. The base rate escalates several times during the course of the lease, specifically in July 2015, July 2017, July 2019 and July 2020. Other Commitments During the first quarter of 2012, the Company extended one of its drilling rig contracts in south Texas for an additional nine months. The Company terminated its second contract with no termination penalty and entered into a new contract for a higher performance rig with the same drilling rig contractor for a period of one year. Drilling operations under these two contracts began in early March 2012. Should the Company elect to terminate one or both contracts and if the drilling contractor were unable to secure work for one or both rigs or if the drilling contractor were unable to secure work for one or both rigs at the same daily rate being charged to the Company prior to the end of their respective terms, the Company would incur termination obligations. The Company's maximum outstanding aggregate termination obligations under these contracts were approximately $9,800,000 at March 31, 2012. At March 31, 2012, the Company had outstanding commitments to participate in the drilling and completion of various non-operated wells in the Haynesville and Eagle Ford shales. The Company's working interests in these wells are small, and most of these wells were in progress at March 31, 2012. If all of these wells are drilled and completed, the Company's minimum outstanding aggregate commitments at March 31, 2012 for its participation in these non-operated Haynesville wells were approximately $5,200,000, and the Company expects these costs to be incurred in the next 12 months. In June 2011, the Company awarded bonuses to certain of its current employees, but not including any of its executive officers, in the aggregate amount of $1,240,000. These bonuses will be payable in a lump sum to each of these employees in June 2014, provided each remains an employee in good standing with the Company at that time. Legal Proceedings The Company is a defendant in several lawsuits encountered in the ordinary course of its business, none of which, in the opinion of management, will have a material adverse impact on the Company's financial position, results of operations or cash flows.

- Definition

The entire disclosure for commitments and contingencies.

+ References

Reference 1: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name FASB Interpretation (FIN)
-Number 14
-Paragraph 3
-LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy.

Reference 2: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Statement of Financial Accounting Standard (FAS)
-Number 5
-Paragraph 9, 10, 11, 12
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Reference 3: http://www.xbrl.org/2003/role/presentationRef
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-Subparagraph (SX 210.5-02.25)
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-SubTopic 20
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-URI http://asc.fasb.org/extlink&oid=6449706&loc=d3e16207-108621

+ Details

Supplemental Disclosures

3 Months Ended

Mar. 31, 2012

Supplemental Disclosures [Abstract]

Supplemental Disclosures

NOTE 11 — SUPPLEMENTAL DISCLOSURES

Accrued Liabilities

The following table summarizes the Company's current accrued liabilities at March 31, 2012 and December 31, 2011.


	March 31, 2012		December 31, 2011
Accrued evaluated and unproved and unevaluated property costs	$	34,974,906	$	18,184,818
Accrued support equipment and facilities costs		1,315,000		215,517
Accrued cost to issue equity		265,014		331,818
Accrued stock-based compensation		1,450,213		2,859,527
Accrued lease operating expenses		3,156,761		575,318
Accrued interest on borrowings under Credit Agreement		84,712		—
Accrued asset retirement obligations		338,917		334,500
Other		1,855,396		2,937,395

Total accrued liabilities	$	43,440,919	$	25,438,893

Supplemental Cash Flow Information

The following table provides supplemental disclosures of cash flow information for the three months ended March 31, 2012 and 2011.


	Three Months Ended March 31,
	2012			2011
Cash paid for interest expense, net of amounts capitalized	$	479,521		$	98,266
Asset retirement obligations related to mineral properties		124,799			58,265
Asset retirement obligations related to support equipment and facilities		28,154			16,818
Increase in liabilities for oil and natural gas properties capital expenditures		13,681,100			4,829,298
Increase (decrease) in liabilities for support equipment and facilities		1,099,483			(40,145	)
(Decrease) increase in liabilities for accrued cost to issue equity		(66,806	)		235,535
Stock-based compensation expense recognized as liability		(454,687	)		(16,250	)
Transfer of inventory from oil and natural gas properties		—			(156,706	)
Receivable for inventory from other joint interest owners		—			(156,706	)

Subsequent Events	3 Months Ended
Subsequent Events	Mar. 31, 2012
Subsequent Events [Abstract]
Subsequent Events	NOTE 12 — SUBSEQUENT EVENTS On April 16, 2012, the Board of Directors approved an award of stock options, restricted stock and restricted stock units to both executive and non-executive employees under the 2012 Incentive Plan. Non-qualified options to purchase an aggregate of 472,318 shares of the Company's common stock at $10.49 per share were awarded; these options vest over four years. A total of 116,842 shares of time-lapse restricted stock was granted, and these shares also vest over four years. A total of 116,841 shares of performance-based restricted stock was granted. These shares vest based on the outcome of the Company's total shareholder return over a three-year period as compared to a designated peer group. This award may result in the issuance of up to 116,841 restricted stock units in addition to the restricted stock grants. This award may also result in no performance-based restricted shares or restricted share units being issued pursuant to the grant. In April 2012, the Company borrowed an additional $15,000,000 under the Credit Agreement to finance a portion of our working capital requirements and capital expenditures. At May 15, 2012, the Company had $30,000,000 in borrowings outstanding under the Credit Agreement and approximately $1,300,000 in letters of credit issued pursuant to the Credit Agreement. The outstanding borrowings bore interest at approximately 2.0% per annum.