NATIONAL FUEL GAS CO, 10-Q filed on 5/5/2017
Quarterly Report
Document And Entity Information
6 Months Ended
Mar. 31, 2017
Apr. 30, 2017
Document And Entity Information [Abstract]
 
 
Document Type
10-Q 
 
Amendment Flag
false 
 
Document Period End Date
Mar. 31, 2017 
 
Document Fiscal Year Focus
2017 
 
Document Fiscal Period Focus
Q2 
 
Entity Registrant Name
NATIONAL FUEL GAS CO 
 
Entity Central Index Key
0000070145 
 
Current Fiscal Year End Date
--09-30 
 
Entity Filer Category
Large Accelerated Filer 
 
Entity Common Stock, Shares Outstanding
 
85,417,057 
Trading Symbol
nfg 
 
Consolidated Statements Of Income And Earnings Reinvested In The Business (Unaudited) (USD $)
In Thousands, except Share data, unless otherwise specified
3 Months Ended 6 Months Ended
Mar. 31, 2017
Mar. 31, 2016
Mar. 31, 2017
Mar. 31, 2016
INCOME
 
 
 
 
Operating Revenues
$ 522,075 
$ 449,132 
$ 944,576 
$ 824,327 
Operating Expenses:
 
 
 
 
Purchased Gas
147,971 
81,623 
218,214 
123,691 
Property, Franchise and Other Taxes
22,542 
21,305 
42,921 
41,662 
Depreciation, Depletion and Amortization
56,999 
63,947 
113,194 
134,498 
Impairment of Oil and Gas Producing Properties
397,443 
832,894 
Total Operating Expenses
352,118 
686,132 
602,479 
1,367,251 
Operating Income (Loss)
169,957 
(237,000)
342,097 
(542,924)
Other Income (Expense):
 
 
 
 
Interest Income
391 
278 
1,991 
2,077 
Other Income
1,744 
3,236 
3,356 
5,654 
Interest Expense on Long-Term Debt
(28,913)
(28,994)
(58,016)
(59,366)
Other Interest Expense
(924)
(1,237)
(1,834)
(2,617)
Income (Loss) Before Income Taxes
142,255 
(263,717)
287,594 
(597,176)
Income Tax Expense (Benefit)
52,971 
(116,030)
109,403 
(260,380)
Net Income (Loss) Available for Common Stock
89,284 
(147,687)
178,191 
(336,796)
EARNINGS REINVESTED IN THE BUSINESS
 
 
 
 
Balance at Beginning of Period
762,641 
880,619 
676,361 
1,103,200 
Beginning Retained Earnings Unappropriated And Current Period Net Income Loss
851,925 
732,932 
854,552 
766,404 
Dividends on Common Stock
(34,577)
(33,533)
(69,120)
(67,005)
Cumulative Effect of Adoption of Authoritative Guidance for Stock-Based Compensation
31,916 
Balance at March 31
817,348 
699,399 
817,348 
699,399 
Earnings Per Common Share, Basic:
 
 
 
 
Net Income (Loss) Available for Common Stock (in dollars per share)
$ 1.05 
$ (1.74)
$ 2.09 
$ (3.97)
Earnings Per Common Share, Diluted:
 
 
 
 
Net Income (Loss) Available for Common Stock (in dollars per share)
$ 1.04 
$ (1.74)
$ 2.07 
$ (3.97)
Weighted Average Common Shares Outstanding:
 
 
 
 
Used in Basic Calculation (shares)
85,334,887 
84,806,982 
85,261,575 
84,728,680 
Used in Diluted Calculation (shares)
86,006,614 
84,806,982 
85,897,282 
84,728,680 
Dividends Per Common Share:
 
 
 
 
Dividends Declared (in dollars per share)
$ 0.405 
$ 0.395 
$ 0.810 
$ 0.790 
Utility and Energy Marketing [Member]
 
 
 
 
INCOME
 
 
 
 
Operating Revenues
308,889 
248,173 
516,669 
417,005 
Operating Expenses:
 
 
 
 
Operation and Maintenance
63,907 
57,309 
114,329 
104,858 
Exploration and Production and Other [Member]
 
 
 
 
INCOME
 
 
 
 
Operating Revenues
159,997 
144,570 
321,691 
297,454 
Operating Expenses:
 
 
 
 
Operation and Maintenance
37,593 
42,964 
68,055 
88,539 
Pipeline and Storage and Gathering [Member]
 
 
 
 
INCOME
 
 
 
 
Operating Revenues
53,189 
56,389 
106,216 
109,868 
Operating Expenses:
 
 
 
 
Operation and Maintenance
$ 23,106 
$ 21,541 
$ 45,766 
$ 41,109 
Consolidated Statements Of Comprehensive Income (Unaudited) (USD $)
In Thousands, unless otherwise specified
3 Months Ended 6 Months Ended
Mar. 31, 2017
Mar. 31, 2016
Mar. 31, 2017
Mar. 31, 2016
Statement of Comprehensive Income [Abstract]
 
 
 
 
Net Income (Loss) Available for Common Stock
$ 89,284 
$ (147,687)
$ 178,191 
$ (336,796)
Other Comprehensive Income (Loss), Before Tax:
 
 
 
 
Unrealized Gain (Loss) on Securities Available for Sale Arising During the Period
1,726 
(4)
843 
(642)
Unrealized Gain (Loss) on Derivative Financial Instruments Arising During the Period
44,097 
33,768 
(8,404)
99,139 
Reclassification Adjustment for Realized (Gains) Losses on Securities Available for Sale in Net Income
(388)
(741)
(388)
Reclassification Adjustment for Realized (Gains) Losses on Derivative Financial Instruments in Net Income
(10,472)
(61,235)
(41,189)
(118,405)
Other Comprehensive Income (Loss), Before Tax
35,351 
(27,859)
(49,491)
(20,296)
Income Tax Expense (Benefit) Related to Unrealized Gain (Loss) on Securities Available for Sale Arising During the Period
645 
(16)
300 
(207)
Income Tax Expense (Benefit) Related to Unrealized Gain (Loss) on Derivative Financial Instruments Arising During the Period
18,352 
14,190 
(3,699)
34,866 
Reclassification Adjustment for Income Tax Benefit (Expense) on Realized Losses (Gains) from Securities Available for Sale in Net Income
(163)
(272)
(163)
Reclassification Adjustment for Income Tax Benefit (Expense) on Realized Losses (Gains) from Derivative Financial Instruments in Net Income
(4,414)
(25,600)
(17,369)
(43,606)
Income Taxes – Net
14,583 
(11,589)
(21,040)
(9,110)
Other Comprehensive Income (Loss)
20,768 
(16,270)
(28,451)
(11,186)
Comprehensive Income (Loss)
$ 110,052 
$ (163,957)
$ 149,740 
$ (347,982)
Consolidated Balance Sheets (Unaudited) (USD $)
In Thousands, unless otherwise specified
Mar. 31, 2017
Sep. 30, 2016
ASSETS
 
 
Property, Plant and Equipment
$ 9,704,134 
$ 9,539,581 
Less - Accumulated Depreciation, Depletion and Amortization
5,185,077 
5,085,099 
Property, Plant and Equipment, Net, Total
4,519,057 
4,454,482 
Current Assets
 
 
Cash and Temporary Cash Investments
231,173 
129,972 
Hedging Collateral Deposits
1,771 1
1,484 1
Receivables – Net of Allowance for Uncollectible Accounts of $27,199 and $21,109, Respectively
171,162 
133,201 
Unbilled Revenue
52,852 
18,382 
Gas Stored Underground
9,027 
34,332 
Materials and Supplies - at average cost
34,695 
33,866 
Unrecovered Purchased Gas Costs
4,681 
2,440 
Other Current Assets
51,585 
59,354 
Total Current Assets
556,946 
413,031 
Other Assets
 
 
Recoverable Future Taxes
179,928 
177,261 
Unamortized Debt Expense
1,424 
1,688 
Other Regulatory Assets
314,903 
320,750 
Deferred Charges
26,128 
20,978 
Other Investments
117,284 
110,664 
Goodwill
5,476 
5,476 
Prepaid Post-Retirement Benefit Costs
18,315 
17,649 
Fair Value of Derivative Financial Instruments
64,729 
113,804 
Other
485 
604 
Total Other Assets
728,672 
768,874 
Total Assets
5,804,675 
5,636,387 
Capitalization:
 
 
Common Stock, $1 Par Value Authorized - 200,000,000 Shares; Issued and Outstanding - 85,375,068 Shares and 85,118,886 Shares, Respectively
85,375 
85,119 
Paid in Capital
782,688 
771,164 
Earnings Reinvested in the Business
817,348 
676,361 
Accumulated Other Comprehensive Loss
(34,091)
(5,640)
Total Comprehensive Shareholders’ Equity
1,651,320 
1,527,004 
Long-term Debt, Net of Unamortized Discount and Debt Issuance Costs
2,087,385 
2,086,252 
Total Capitalization
3,738,705 
3,613,256 
Current and Accrued Liabilities
 
 
Notes Payable to Banks and Commercial Paper
Current Portion of Long-Term Debt
Accounts Payable
111,382 
108,056 
Amounts Payable to Customers
19,466 
19,537 
Dividends Payable
34,577 
34,473 
Interest Payable on Long-Term Debt
34,900 
34,900 
Customer Advances
300 
14,762 
Customer Security Deposits
17,512 
16,019 
Other Accruals and Current Liabilities
106,287 
74,430 
Fair Value of Derivative Financial Instruments
1,471 
1,560 
Total Current and Accrued Liabilities
325,895 
303,737 
Deferred Credits
 
 
Deferred Income Taxes
837,098 
823,795 
Taxes Refundable to Customers
93,506 
93,318 
Cost of Removal Regulatory Liability
196,901 
193,424 
Other Regulatory Liabilities
91,661 
99,789 
Pension and Other Post-Retirement Liabilities
291,259 
277,113 
Asset Retirement Obligations
114,014 
112,330 
Other Deferred Credits
115,636 
119,625 
Total Deferred Credits
1,740,075 
1,719,394 
Commitments and Contingencies (Note 6)
Total Capitalization and Liabilities
$ 5,804,675 
$ 5,636,387 
Consolidated Balance Sheets (Parenthetical) (USD $)
In Thousands, except Share data, unless otherwise specified
Mar. 31, 2017
Sep. 30, 2016
Statement of Financial Position [Abstract]
 
 
Receivables, Allowance for Uncollectible Accounts
$ 27,199 
$ 21,109 
Common Stock, Par Value
$ 1 
$ 1 
Common Stock, Shares Authorized
200,000,000 
200,000,000 
Common Stock, Shares Issued
85,375,068 
85,118,886 
Common Stock, Shares Outstanding
85,375,068 
85,118,886 
Consolidated Statements Of Cash Flows (Unaudited) (USD $)
In Thousands, unless otherwise specified
6 Months Ended
Mar. 31, 2017
Mar. 31, 2016
OPERATING ACTIVITIES
 
 
Net Income (Loss) Available for Common Stock
$ 178,191 
$ (336,796)
Adjustments to Reconcile Net Income (Loss) to Net Cash Provided by Operating Activities:
 
 
Impairment of Oil and Gas Producing Properties
832,894 
Depreciation, Depletion and Amortization
113,194 
134,498 
Deferred Income Taxes
63,781 
(283,912)
Excess Tax Benefits Associated with Stock-Based Compensation Awards
(226)
Stock-Based Compensation
5,632 
2,518 
Other
7,713 
6,106 
Change in:
 
 
Hedging Collateral Deposits
(287)
1,161 
Receivables and Unbilled Revenue
(92,155)
(28,211)
Gas Stored Underground and Materials and Supplies
24,476 
22,637 
Unrecovered Purchased Gas Costs
(2,241)
(1,245)
Other Current Assets
7,769 
4,177 
Accounts Payable
13,997 
(31,786)
Amounts Payable to Customers
(71)
(14,561)
Customer Advances
(14,462)
(16,203)
Customer Security Deposits
1,493 
(389)
Other Accruals and Current Liabilities
44,690 
22,420 
Other Assets
(32)
3,754 
Other Liabilities
202 
(4,073)
Net Cash Provided by Operating Activities
351,890 
312,763 
INVESTING ACTIVITIES
 
 
Capital Expenditures
(208,231)
(358,981)
Net Proceeds from Sale of Oil and Gas Producing Properties
26,554 
104,938 
Other
(3,225)
(18,249)
Net Cash Used in Investing Activities
(184,902)
(272,292)
Financing Activities
 
 
Excess Tax Benefits Associated with Stock-Based Compensation Awards
226 
Dividends Paid on Common Stock
(69,017)
(66,887)
Net Proceeds from Issuance of Common Stock
3,230 
6,294 
Net Cash Used in Financing Activities
(65,787)
(60,367)
Net Increase (Decrease) in Cash and Temporary Cash Investments
101,201 
(19,896)
Cash and Temporary Cash Investments at October 1
129,972 
113,596 
Cash and Temporary Cash Investments at March 31
231,173 
93,700 
Supplemental Disclosure of Cash Flow Information, Non-Cash Investing Activities:
 
 
Non-Cash Capital Expenditures
36,932 
66,058 
Receivable from Sale of Oil and Gas Producing Properties
$ 0 
$ 10,297 
Summary Of Significant Accounting Policies
Summary Of Significant Accounting Policies
Summary of Significant Accounting Policies
 
Principles of Consolidation.  The Company consolidates all entities in which it has a controlling financial interest.  All significant intercompany balances and transactions are eliminated. The Company uses proportionate consolidation when accounting for drilling arrangements related to oil and gas producing properties accounted for under the full cost method of accounting.
 
The preparation of the consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period.  Actual results could differ from those estimates.

Reclassification. Certain prior year amounts have been reclassified to conform with current year presentation.

Earnings for Interim Periods.  The Company, in its opinion, has included all adjustments (which consist of only normally recurring adjustments, unless otherwise disclosed in this Form 10-Q) that are necessary for a fair statement of the results of operations for the reported periods. The consolidated financial statements and notes thereto, included herein, should be read in conjunction with the financial statements and notes for the years ended September 30, 2016, 2015 and 2014 that are included in the Company's 2016 Form 10-K.  The consolidated financial statements for the year ended September 30, 2017 will be audited by the Company's independent registered public accounting firm after the end of the fiscal year.
 
The earnings for the six months ended March 31, 2017 should not be taken as a prediction of earnings for the entire fiscal year ending September 30, 2017.  Most of the business of the Utility and Energy Marketing segments is seasonal in nature and is influenced by weather conditions.  Due to the seasonal nature of the heating business in the Utility and Energy Marketing segments, earnings during the winter months normally represent a substantial part of the earnings that those segments are expected to achieve for the entire fiscal year.  The Company’s business segments are discussed more fully in Note 7 – Business Segment Information.
 
Consolidated Statements of Cash Flows.  For purposes of the Consolidated Statements of Cash Flows, the Company considers all highly liquid debt instruments purchased with a maturity of generally three months or less to be cash equivalents.
 
Hedging Collateral Deposits.  This is an account title for cash held in margin accounts funded by the Company to serve as collateral for hedging positions.  In accordance with its accounting policy, the Company does not offset hedging collateral deposits paid or received against related derivative financial instruments liability or asset balances.
 
Gas Stored Underground.  In the Utility segment, gas stored underground is carried at lower of cost or net realizable value, on a LIFO method.  Gas stored underground normally declines during the first and second quarters of the year and is replenished during the third and fourth quarters.  In the Utility segment, the current cost of replacing gas withdrawn from storage is recorded in the Consolidated Statements of Income and a reserve for gas replacement is recorded in the Consolidated Balance Sheets under the caption “Other Accruals and Current Liabilities.”  Such reserve, which amounted to $20.2 million at March 31, 2017, is reduced to zero by September 30 of each year as the inventory is replenished.
 
Property, Plant and Equipment.  In the Company’s Exploration and Production segment, oil and gas property acquisition, exploration and development costs are capitalized under the full cost method of accounting. Under this methodology, all costs associated with property acquisition, exploration and development activities are capitalized, including internal costs directly identified with acquisition, exploration and development activities. The internal costs that are capitalized do not include any costs related to production, general corporate overhead, or similar activities. The Company does not recognize any gain or loss on the sale or other disposition of oil and gas properties unless the gain or loss would significantly alter the relationship between capitalized costs and proved reserves of oil and gas attributable to a cost center.
 
Capitalized costs include costs related to unproved properties, which are excluded from amortization until proved reserves are found or it is determined that the unproved properties are impaired.  Such costs amounted to $114.3 million and $135.3 million at March 31, 2017 and September 30, 2016, respectively.  All costs related to unproved properties are reviewed quarterly to determine if impairment has occurred. The amount of any impairment is transferred to the pool of capitalized costs being amortized.
 
Capitalized costs are subject to the SEC full cost ceiling test. The ceiling test, which is performed each quarter, determines a limit, or ceiling, on the amount of property acquisition, exploration and development costs that can be capitalized. The ceiling under this test represents (a) the present value of estimated future net cash flows, excluding future cash outflows associated with settling asset retirement obligations that have been accrued on the balance sheet, using a discount factor of 10%, which is computed by applying prices of oil and gas (as adjusted for hedging) to estimated future production of proved oil and gas reserves as of the date of the latest balance sheet, less estimated future expenditures, plus (b) the cost of unevaluated properties not being depleted, less (c) income tax effects related to the differences between the book and tax basis of the properties. The natural gas and oil prices used to calculate the full cost ceiling are based on an unweighted arithmetic average of the first day of the month oil and gas prices for each month within the twelve-month period prior to the end of the reporting period. If capitalized costs, net of accumulated depreciation, depletion and amortization and related deferred income taxes, exceed the ceiling at the end of any quarter, a permanent impairment is required to be charged to earnings in that quarter.  At March 31, 2017, the ceiling exceeded the book value of the oil and gas properties by approximately $201.0 million. In adjusting estimated future cash flows for hedging under the ceiling test at March 31, 2017, estimated future net cash flows were increased by $105.4 million.

On December 1, 2015, Seneca and IOG - CRV Marcellus, LLC (IOG), an affiliate of IOG Capital, LP, and funds managed by affiliates of Fortress Investment Group, LLC, executed a joint development agreement that allows IOG to participate in the development of certain oil and gas interests owned by Seneca in Elk, McKean and Cameron Counties, Pennsylvania. On June 13, 2016, Seneca and IOG executed an extension of the joint development agreement. Under the terms of the extended agreement, Seneca and IOG will jointly participate in a program to develop up to 75 Marcellus wells, with Seneca serving as program operator. Under the original joint development agreement, IOG had committed to develop 42 Marcellus wells. IOG will hold an 80% working interest in all of the joint development wells. In total, IOG is expected to fund approximately $325 million for its 80% working interest in the 75 joint development wells. Of this amount, IOG has funded $251.4 million as of March 31, 2017, which includes $163.9 million of cash ($137.3 million in fiscal 2016 and $26.6 million in fiscal 2017) that Seneca had received in recognition of IOG funding that is due to Seneca for costs previously incurred to develop a portion of the first 75 joint development wells. The cash proceeds were recorded by Seneca as a $163.9 million reduction of property, plant and equipment. The remainder funded was incurred for joint development expenditures. As the fee-owner of the property’s mineral rights, Seneca retains a 7.5% royalty interest and the remaining 20% working interest (26% net revenue interest) in 56 of the joint development wells. In the remaining 19 wells, Seneca retains a 20% working and net revenue interest. Seneca’s working interest under the agreement will increase to 85% after IOG achieves a 15% internal rate of return.
Accumulated Other Comprehensive Loss.  The components of Accumulated Other Comprehensive Loss and changes for the six months ended March 31, 2017 and 2016, net of related tax effect, are as follows (amounts in parentheses indicate debits) (in thousands): 
 
Gains and Losses on Derivative Financial Instruments
Gains and Losses on Securities Available for Sale
Funded Status of the Pension and Other Post-Retirement Benefit Plans
Total
Three Months Ended March 31, 2017
 
 
 
 
Balance at January 1, 2017
$
16,570

$
5,047

$
(76,476
)
$
(54,859
)
Other Comprehensive Gains and Losses Before Reclassifications
25,745

1,081


26,826

Amounts Reclassified From Other Comprehensive Income (Loss)
(6,058
)


(6,058
)
Balance at March 31, 2017
$
36,257

$
6,128

$
(76,476
)
$
(34,091
)
Six Months Ended March 31, 2017
 
 
 
 
Balance at October 1, 2016
$
64,782

$
6,054

$
(76,476
)
$
(5,640
)
Other Comprehensive Gains and Losses Before Reclassifications
(4,705
)
543


(4,162
)
Amounts Reclassified From Other Comprehensive Income (Loss)
(23,820
)
(469
)

(24,289
)
Balance at March 31, 2017
$
36,257

$
6,128

$
(76,476
)
$
(34,091
)
Three Months Ended March 31, 2016
 
 
 
 
Balance at January 1, 2016
$
162,728

$
5,522

$
(69,794
)
$
98,456

Other Comprehensive Gains and Losses Before Reclassifications
19,578

12


19,590

Amounts Reclassified From Other Comprehensive Income (Loss)
(35,635
)
(225
)

(35,860
)
Balance at March 31, 2016
$
146,671

$
5,309

$
(69,794
)
$
82,186

Six Months Ended March 31, 2016
 
 
 
 
Balance at October 1, 2015
$
157,197

$
5,969

$
(69,794
)
$
93,372

Other Comprehensive Gains and Losses Before Reclassifications
64,273

(435
)

63,838

Amounts Reclassified From Other Comprehensive Income (Loss)
(74,799
)
(225
)

(75,024
)
Balance at March 31, 2016
$
146,671

$
5,309

$
(69,794
)
$
82,186

 
 
 
 
 

Reclassifications Out of Accumulated Other Comprehensive Loss.  The details about the reclassification adjustments out of accumulated other comprehensive loss for the six months ended March 31, 2017 and 2016 are as follows (amounts in parentheses indicate debits to the income statement) (in thousands):
Details About Accumulated Other Comprehensive Income (Loss) Components
Amount of Gain or (Loss) Reclassified from Accumulated Other Comprehensive Loss
Affected Line Item in the Statement Where Net Income (Loss) is Presented
 
Three Months Ended March 31,
Six Months Ended March 31,
 
 
2017
2016
2017
2016
 
Gains (Losses) on Derivative Financial Instrument Cash Flow Hedges:
 
 
 
 
 
     Commodity Contracts

$12,109


$57,914


$43,429


$114,242

Operating Revenues
     Commodity Contracts
(1,498
)
3,530

(1,958
)
4,450

Purchased Gas
     Foreign Currency Contracts
(139
)
(209
)
(282
)
(287
)
Operation and Maintenance Expense
Gains (Losses) on Securities Available for Sale

388

741

388

Other Income
 
10,472

61,623

41,930

118,793

Total Before Income Tax
 
(4,414
)
(25,763
)
(17,641
)
(43,769
)
Income Tax Expense
 

$6,058


$35,860


$24,289


$75,024

Net of Tax

Other Current Assets.  The components of the Company’s Other Current Assets are as follows (in thousands):
                            
At March 31, 2017
 
At September 30, 2016
 
 
 
 
Prepayments
$
5,284

 
$
10,919

Prepaid Property and Other Taxes
22,563

 
13,138

Federal Income Taxes Receivable

 
11,758

State Income Taxes Receivable
5,237

 
3,961

Fair Values of Firm Commitments

 
3,962

Regulatory Assets
18,501

 
15,616

 
$
51,585

 
$
59,354


 
Other Accruals and Current Liabilities.  The components of the Company’s Other Accruals and Current Liabilities are as follows (in thousands):
                            
At March 31, 2017
 
At September 30, 2016
 
 
 
 
Accrued Capital Expenditures
$
13,964

 
$
26,796

Regulatory Liabilities
29,579

 
14,725

Reserve for Gas Replacement
20,215

 

Federal Income Taxes Payable
9,355

 

Other
33,174

 
32,909

 
$
106,287

 
$
74,430


 
Earnings Per Common Share.  Basic earnings per common share is computed by dividing income or loss by the weighted average number of common shares outstanding for the period. Diluted earnings per common share reflects the potential dilution that could occur if securities or other contracts to issue common stock were exercised or converted into common stock.  For purposes of determining earnings per common share, the potentially dilutive securities the Company has outstanding are stock options, SARs, restricted stock units and performance shares.  For the quarter and six months ended March 31, 2017, the diluted weighted average shares outstanding shown on the Consolidated Statements of Income reflects the potential dilution as a result of these securities as determined using the Treasury Stock Method.  Stock options, SARs, restricted stock units and performance shares that are antidilutive are excluded from the calculation of diluted earnings per common share. There were 157,554 securities and 158,211 securities excluded as being antidilutive for the quarter and six months ended March 31, 2017, respectively. As the Company recognized a net loss for both the quarter and six months ended March 31, 2016, the aforementioned potentially dilutive securities, amounting to 386,626 securities and 451,291 securities, were not recognized in the diluted earnings per share calculation for the quarter and six months ended March 31, 2016, respectively.
 
Stock-Based Compensation.  The Company granted 184,148 performance shares during the six months ended March 31, 2017. The weighted average fair value of such performance shares was $56.39 per share for the six months ended March 31, 2017. Performance shares are an award constituting units denominated in common stock of the Company, the number of which may be adjusted over a performance cycle based upon the extent to which performance goals have been satisfied.  Earned performance shares may be distributed in the form of shares of common stock of the Company, an equivalent value in cash or a combination of cash and shares of common stock of the Company, as determined by the Company. The performance shares do not entitle the participant to receive dividends during the vesting period.
 
Half of the performance shares granted during the six months ended March 31, 2017 must meet a performance goal related to relative return on capital over the performance cycle of October 1, 2016 to September 30, 2019.  The performance goal over the performance cycle is the Company’s total return on capital relative to the total return on capital of other companies in a group selected by the Compensation Committee (“Report Group”).  Total return on capital for a given company means the average of the Report Group companies’ returns on capital for each twelve month period corresponding to each of the Company’s fiscal years during the performance cycle, based on data reported for the Report Group companies in the Bloomberg database.  The number of these performance shares that will vest and be paid will depend upon the Company’s performance relative to the Report Group and not upon the absolute level of return achieved by the Company.  The fair value of these performance shares is calculated by multiplying the expected number of shares that will be issued by the average market price of Company common stock on the date of grant reduced by the present value of forgone dividends over the vesting term of the award.  The fair value is recorded as compensation expense over the vesting term of the award.  The other half of the performance shares granted during the six months ended March 31, 2017 must meet a performance goal related to relative total shareholder return over the performance cycle of October 1, 2016 to September 30, 2019.  The performance goal over the performance cycle is the Company’s three-year total shareholder return relative to the three-year total shareholder return of the other companies in the Report Group.  Three-year shareholder return for a given company will be based on the data reported for that company (with the starting and ending stock prices over the performance cycle calculated as the average closing stock price for the prior calendar month and with dividends reinvested in that company’s securities at each ex-dividend date) in the Bloomberg database.  The number of these total shareholder return performance shares ("TSR performance shares") that will vest and be paid will depend upon the Company’s performance relative to the Report Group and not upon the absolute level of return achieved by the Company.  The fair value price at the date of grant for the TSR performance shares is determined using a Monte Carlo simulation technique, which includes a reduction in value for the present value of forgone dividends over the vesting term of the award.  This price is multiplied by the number of TSR performance shares awarded, the result of which is recorded as compensation expense over the vesting term of the award.
 
The Company granted 87,143 non-performance based restricted stock units during the six months ended March 31, 2017.  The weighted average fair value of such non-performance based restricted stock units was $52.13 per share for the six months ended March 31, 2017. Restricted stock units represent the right to receive shares of common stock of the Company (or the equivalent value in cash or a combination of cash and shares of common stock of the Company, as determined by the Company) at the end of a specified time period. These non-performance based restricted stock units do not entitle the participant to receive dividends during the vesting period. The accounting for non-performance based restricted stock units is the same as the accounting for restricted share awards, except that the fair value at the date of grant of the restricted stock units must be reduced by the present value of forgone dividends over the vesting term of the award.
 
New Authoritative Accounting and Financial Reporting Guidance. In May 2014, the FASB issued authoritative guidance regarding revenue recognition. The authoritative guidance provides a single, comprehensive revenue recognition model for all contracts with customers to improve comparability. The revenue standard contains principles that an entity will apply to determine the measurement of revenue and timing of when it is recognized. The original effective date of this authoritative guidance was as of the Company's first quarter of fiscal 2018. However, the FASB has delayed the effective date of the new revenue standard by one year, and the guidance will now be effective as of the Company's first quarter of fiscal 2019. Working towards this implementation date, the Company is currently evaluating the guidance and the various issues identified by industry based revenue recognition task forces and intends to begin analyzing its contractual arrangements with customers in the second half of fiscal 2017.
In February 2016, the FASB issued authoritative guidance requiring organizations that lease assets to recognize on the balance sheet the assets and liabilities for the rights and obligations created by all leases, regardless of whether they are considered to be capital leases or operating leases. The FASB’s previous authoritative guidance required organizations that lease assets to recognize on the balance sheet the assets and liabilities for the rights and obligations created by capital leases while excluding operating leases from balance sheet recognition. The new authoritative guidance will be effective as of the Company’s first quarter of fiscal 2020, with early adoption permitted. The Company does not anticipate early adoption and is currently evaluating the provisions of the revised guidance.
In March 2016, the FASB issued authoritative guidance simplifying several aspects of the accounting for stock-based compensation. The Company adopted this guidance effective as of October 1, 2016, recognizing a cumulative effect adjustment that increased retained earnings by $31.9 million. The cumulative effect represents the tax benefit of previously unrecognized tax deductions in excess of stock compensation recorded for financial reporting purposes. On a prospective basis, the tax effect of all future differences between stock compensation recorded for financial reporting purposes and actual tax deductions for stock compensation will be recognized upon vesting or settlement as income tax expense or benefit in the income statement. From a statement of cash flows perspective, the tax benefits relating to differences between stock compensation recorded for financial reporting purposes and actual tax deductions for stock compensation are now included in cash provided by operating activities instead of cash provided by financing activities. The changes to the statement of cash flows have been applied prospectively and prior periods have not been adjusted.
In March 2017, the FASB issued authoritative guidance related to the presentation of net periodic pension cost and net periodic postretirement benefit cost. The new guidance requires segregation of the service cost component from the other components of net periodic pension cost and net periodic postretirement benefit cost for financial reporting purposes. The service cost component is to be presented on the income statement in the same line items as other compensation costs included within Operating Expenses and the other components of net periodic pension cost and net periodic postretirement benefit cost are to be presented on the income statement below the subtotal labeled Operating Income (Loss). Under this guidance, the service cost component shall be the only component eligible to be capitalized as part of the cost of inventory or property, plant and equipment. The new guidance will be effective as of the Company’s first quarter of fiscal 2019, with early adoption permitted. The Company is currently evaluating the interaction of this authoritative guidance with the various regulatory provisions concerning pension and postretirement benefit costs in the Company’s Utility and Pipeline and Storage segments.
Fair Value Measurements
Fair Value Measurements
Fair Value Measurements
 
The FASB authoritative guidance regarding fair value measurements establishes a fair-value hierarchy and prioritizes the inputs used in valuation techniques that measure fair value. Those inputs are prioritized into three levels. Level 1 inputs are unadjusted quoted prices in active markets for assets or liabilities that the Company can access at the measurement date. Level 2 inputs are inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly at the measurement date. Level 3 inputs are unobservable inputs for the asset or liability at the measurement date. The Company’s assessment of the significance of a particular input to the fair value measurement requires judgment, and may affect the valuation of fair value assets and liabilities and their placement within the fair value hierarchy levels.
 
The following table sets forth, by level within the fair value hierarchy, the Company's financial assets and liabilities (as applicable) that were accounted for at fair value on a recurring basis as of March 31, 2017 and September 30, 2016.  Financial assets and liabilities are classified in their entirety based on the lowest level of input that is significant to the fair value measurement. The fair value presentation for over the counter swaps combines gas and oil swaps because a significant number of the counterparties enter into both gas and oil swap agreements with the Company.  
Recurring Fair Value Measures
At fair value as of March 31, 2017
(Thousands of Dollars)   
Level 1
 
Level 2
 
Level 3
 
Netting Adjustments(1)
 
Total(1)
Assets:
 

 
 

 
 

 
 

 
 

Cash Equivalents – Money Market Mutual Funds
$
214,213

 
$

 
$

 
$

 
$
214,213

Derivative Financial Instruments:
 

 
 

 
 

 
 

 
 

Commodity Futures Contracts – Gas
2,449

 

 

 
(1,068
)
 
1,381

Over the Counter Swaps – Gas and Oil

 
73,525

 

 
(10,177
)
 
63,348

Foreign Currency Contracts

 
48

 

 
(48
)
 

Other Investments:
 

 
 

 
 

 
 

 
 

Balanced Equity Mutual Fund
34,664

 

 

 

 
34,664

Fixed Income Mutual Fund
38,460

 

 

 

 
38,460

Common Stock – Financial Services Industry
3,649

 

 

 

 
3,649

Hedging Collateral Deposits
1,771

 

 

 

 
1,771

Total                                           
$
295,206

 
$
73,573

 
$

 
$
(11,293
)
 
$
357,486

 
 
 
 
 
 
 
 
 
 
Liabilities:
 

 
 

 
 

 
 

 
 

Derivative Financial Instruments:
 

 
 

 
 

 
 

 
 

Commodity Futures Contracts – Gas
$
1,068

 
$

 
$

 
$
(1,068
)
 
$

Over the Counter Swaps – Gas and Oil

 
9,641

 

 
(10,177
)
 
(536
)
Foreign Currency Contracts

 
2,055

 

 
(48
)
 
2,007

Total
$
1,068

 
$
11,696

 
$

 
$
(11,293
)
 
$
1,471

Total Net Assets/(Liabilities)
$
294,138

 
$
61,877

 
$

 
$

 
$
356,015

 
Recurring Fair Value Measures
At fair value as of September 30, 2016
(Thousands of Dollars)   
Level 1
 
Level 2
 
Level 3
 
Netting Adjustments(1)
 
Total(1)
Assets:
 

 
 

 
 

 
 

 
 

Cash Equivalents – Money Market Mutual Funds
$
114,895

 
$

 
$

 
$

 
$
114,895

Derivative Financial Instruments:
 

 
 

 
 

 
 

 
 

Commodity Futures Contracts – Gas
2,623

 

 

 
(2,276
)
 
347

Over the Counter Swaps – Gas and Oil

 
119,654

 

 
(3,860
)
 
115,794

Foreign Currency Contracts

 

 

 
(2,337
)
 
(2,337
)
Other Investments:
 

 
 

 
 

 
 

 
 

Balanced Equity Mutual Fund
36,658

 

 

 

 
36,658

Fixed Income Mutual Fund
31,395

 

 

 

 
31,395

Common Stock – Financial Services Industry
2,902

 

 

 

 
2,902

Hedging Collateral Deposits
1,484

 

 

 

 
1,484

Total                                           
$
189,957

 
$
119,654

 
$

 
$
(8,473
)
 
$
301,138

 
 
 
 
 
 
 
 
 
 
Liabilities:
 

 
 

 
 

 
 

 
 

Derivative Financial Instruments:
 

 
 

 
 

 
 

 
 

Commodity Futures Contracts – Gas
$
2,276

 
$

 
$

 
$
(2,276
)
 
$

Over the Counter Swaps – Gas and Oil

 
5,322

 

 
(3,860
)
 
1,462

     Foreign Currency Contracts

 
2,337

 

 
(2,337
)
 

Total
$
2,276

 
$
7,659

 
$

 
$
(8,473
)
 
$
1,462

Total Net Assets/(Liabilities)
$
187,681

 
$
111,995

 
$

 
$

 
$
299,676


(1) 
Netting Adjustments represent the impact of legally-enforceable master netting arrangements that allow the Company to net gain and loss positions held with the same counterparties. The net asset or net liability for each counterparty is recorded as an asset or liability on the Company’s balance sheet.
 
Derivative Financial Instruments
 
At March 31, 2017 and September 30, 2016, the derivative financial instruments reported in Level 1 consist of natural gas NYMEX and ICE futures contracts used in the Company’s Energy Marketing segment. Hedging collateral deposits were $1.8 million at March 31, 2017 and $1.5 million at September 30, 2016, which were associated with these futures contracts and have been reported in Level 1 as well. The derivative financial instruments reported in Level 2 at March 31, 2017 and September 30, 2016 consist of natural gas price swap agreements used in the Company’s Exploration and Production and Energy Marketing segments, crude oil price swap agreements used in the Company’s Exploration and Production segment and foreign currency contracts used in the Company's Exploration and Production segment. The derivative financial instruments reported in Level 2 at March 31, 2017 also include basis hedge swap agreements used in the Company's Energy Marketing segment. The fair value of the Level 2 price swap agreements is based on an internal, discounted cash flow model that uses observable inputs (i.e. LIBOR based discount rates and basis differential information, if applicable, at active natural gas and crude oil trading markets). The fair value of the Level 2 foreign currency contracts is determined using the market approach based on observable market transactions of forward Canadian currency rates. 
 
The accounting rules for fair value measurements and disclosures require consideration of the impact of nonperformance risk (including credit risk) from a market participant perspective in the measurement of the fair value of assets and liabilities.  At March 31, 2017, the Company determined that nonperformance risk would have no material impact on its financial position or results of operation.  To assess nonperformance risk, the Company considered information such as any applicable collateral posted, master netting arrangements, and applied a market-based method by using the counterparty's (assuming the derivative is in a gain position) or the Company’s (assuming the derivative is in a loss position) credit default swaps rates.
 
The table listed below provides a reconciliation of the beginning and ending net balances for assets and liabilities measured at fair value and classified as Level 3 for the six months ended March 31, 2016. For the six months ended March 31, 2017, there were no assets or liabilities measured at fair value and classified as Level 3. The Company's Exploration and Production segment had a small portion of their crude oil price swap agreements reported as Level 3 at October 1, 2015 that settled during the first quarter of fiscal 2016. For the quarters and six months ended March 31, 2017 and March 31, 2016, no transfers in or out of Level 1 or Level 2 occurred. There were no purchases or sales of derivative financial instruments during the period presented in the table below.  All settlements of the derivative financial instruments are reflected in the Gains/Losses Realized and Included in Earnings column of the table below (amounts in parentheses indicate credits in the derivative asset/liability accounts).  
 
 
 
 
 
 
 
Fair Value Measurements Using Unobservable Inputs (Level 3)
(Thousands of Dollars)   
 
Total Gains/Losses 
 
 
 
October 1, 2015
Gains/Losses Realized and Included in Earnings
Gains/Losses Unrealized and Included in Other Comprehensive Income (Loss)
Transfer In/Out of Level 3
March 31, 2016
Derivative Financial Instruments(2)
$
1,791

$
(2,002
)
(1) 
$
211

$

$

 
 
 
 
 
 
 

(1) 
Amounts are reported in Operating Revenues in the Consolidated Statement of Income for the three months ended March 31, 2016
(2) 
Derivative Financial Instruments are shown on a net basis.
Financial Instruments
Financial Instruments
Financial Instruments
 
Long-Term Debt.  The fair market value of the Company’s debt, as presented in the table below, was determined using a discounted cash flow model, which incorporates the Company’s credit ratings and current market conditions in determining the yield, and subsequently, the fair market value of the debt.  Based on these criteria, the fair market value of long-term debt, including current portion, was as follows (in thousands): 
 
March 31, 2017
 
September 30, 2016
 
Carrying Amount
 
Fair Value
 
Carrying Amount
 
Fair Value
Long-Term Debt
$
2,087,385

 
$
2,221,216

 
$
2,086,252

 
$
2,255,562


 
The fair value amounts are not intended to reflect principal amounts that the Company will ultimately be required to pay. Carrying amounts for other financial instruments recorded on the Company’s Consolidated Balance Sheets approximate fair value. The fair value of long-term debt was calculated using observable inputs (U.S. Treasuries/LIBOR for the risk free component and company specific credit spread information – generally obtained from recent trade activity in the debt).  As such, the Company considers the debt to be Level 2.
 
Any temporary cash investments, notes payable to banks and commercial paper are stated at cost. Temporary cash investments are considered Level 1, while notes payable to banks and commercial paper are considered to be Level 2.  Given the short-term nature of the notes payable to banks and commercial paper, the Company believes cost is a reasonable approximation of fair value.
 
Other Investments.  Investments in life insurance are stated at their cash surrender values or net present value as discussed below. Investments in an equity mutual fund, a fixed income mutual fund and the stock of an insurance company (marketable equity securities), as discussed below, are stated at fair value based on quoted market prices.
 
Other investments include cash surrender values of insurance contracts (net present value in the case of split-dollar collateral assignment arrangements) and marketable equity and fixed income securities. The values of the insurance contracts amounted to $40.5 million at March 31, 2017 and $39.7 million at September 30, 2016. The fair value of the equity mutual fund was $34.7 million at March 31, 2017 and $36.7 million at September 30, 2016. The gross unrealized gain on this equity mutual fund was $7.4 million at March 31, 2017 and $7.9 million at September 30, 2016. The fair value of the fixed income mutual fund was $38.5 million at March 31, 2017 and $31.4 million at September 30, 2016. The gross unrealized loss on this fixed income mutual fund was $0.1 million at March 31, 2017 and the gross unrealized gain on this fixed income mutual fund was less than $0.1 million at September 30, 2016. The fair value of the stock of an insurance company was $3.6 million at March 31, 2017 and $2.9 million at September 30, 2016. The gross unrealized gain on this stock was $2.4 million at March 31, 2017 and $1.6 million at September 30, 2016. The insurance contracts and marketable equity securities are primarily informal funding mechanisms for various benefit obligations the Company has to certain employees.
 
Derivative Financial Instruments.  The Company uses derivative financial instruments to manage commodity price risk in the Exploration and Production segment as well as the Energy Marketing segment. The Company enters into futures contracts and over-the-counter swap agreements for natural gas and crude oil to manage the price risk associated with forecasted sales of gas and oil. In addition, the Company also enters into foreign exchange forward contracts to manage the risk of currency fluctuations associated with transportation costs denominated in Canadian currency in the Exploration and Production segment. These instruments are accounted for as cash flow hedges. The Company also enters into futures contracts and swaps, which are accounted for as cash flow hedges, to manage the price risk associated with forecasted gas purchases. The Company enters into futures contracts and swaps to mitigate risk associated with fixed price sales commitments, fixed price purchase commitments, and the decline in value of natural gas held in storage. These instruments are accounted for as fair value hedges. The duration of the Company’s combined cash flow and fair value commodity hedges does not typically exceed 7 years while the foreign currency forward contracts do not exceed ten years. The Exploration and Production segment holds the majority of the Company’s derivative financial instruments.

The Company has presented its net derivative assets and liabilities as “Fair Value of Derivative Financial Instruments” on its Consolidated Balance Sheets at March 31, 2017 and September 30, 2016.  Substantially all of the derivative financial instruments reported on those line items relate to commodity contracts and a small portion relates to foreign currency forward contracts.
 
Cash Flow Hedges
 
For derivative instruments that are designated and qualify as a cash flow hedge, the effective portion of the gain or loss on the derivative is reported as a component of other comprehensive income and reclassified into earnings in the period or periods during which the hedged transaction affects earnings.  Gains and losses on the derivative representing either hedge ineffectiveness or hedge components excluded from the assessment of effectiveness are recognized in current earnings. 

As of March 31, 2017, the Company had the following commodity derivative contracts (swaps and futures contracts) outstanding:
Commodity
Units

 
Natural Gas
138.8

 Bcf (short positions)
Natural Gas
1.6

 Bcf (long positions)
Crude Oil
3,051,000

 Bbls (short positions)
    
As of March 31, 2017, the Company was hedging a total of $72.5 million of forecasted transportation costs denominated in Canadian dollars with foreign currency forward contracts (long positions).
As of March 31, 2017, the Company had $62.2 million ($36.3 million after tax) of net hedging gains included in the accumulated other comprehensive income (loss) balance. It is expected that $35.9 million ($21.0 million after tax) of such unrealized gains will be reclassified into the Consolidated Statement of Income within the next 12 months as the underlying hedged transaction are recorded in earnings.
The Effect of Derivative Financial Instruments on the Statement of Financial Performance for the
Three Months Ended March 31, 2017 and 2016 (Thousands of Dollars)
Derivatives in Cash Flow Hedging Relationships
Amount of Derivative Gain or (Loss) Recognized in Other Comprehensive Income (Loss) on the Consolidated Statement of Comprehensive Income (Loss) (Effective Portion) for the Three Months Ended March 31,
Location of Derivative Gain or (Loss) Reclassified from Accumulated Other Comprehensive Income (Loss) on the Consolidated Balance Sheet into the Consolidated Statement of Income (Effective Portion)
Amount of Derivative Gain or (Loss) Reclassified from Accumulated Other Comprehensive Income (Loss) on the Consolidated Balance Sheet into the Consolidated Statement of Income (Effective Portion) for the Three Months Ended March 31,
Location of Derivative Gain or (Loss) Recognized in the Consolidated Statement of Income (Ineffective Portion and Amount Excluded from Effectiveness Testing)
Derivative Gain or (Loss) Recognized in the Consolidated Statement of Income (Ineffective Portion and Amount Excluded from Effectiveness Testing) for the Three Months Ended March 31,
 
2017
2016
 
2017
2016
 
2017
2016
Commodity Contracts
$
42,484

$
30,876

Operating Revenue
$
12,109

$
57,914

Operating Revenue
$

$
31

Commodity Contracts
1,044

(214
)
Purchased Gas
(1,498
)
3,530

Not Applicable


Foreign Currency Contracts
569

3,106

Operation and Maintenance Expense
(139
)
(209
)
Not Applicable


Total
$
44,097

$
33,768

 
$
10,472

$
61,235

 
$

$
31

The Effect of Derivative Financial Instruments on the Statement of Financial Performance for the
Six Months Ended March 31, 2017 and 2016 (Thousands of Dollars)
Derivatives in Cash Flow Hedging Relationships
Amount of Derivative Gain or (Loss) Recognized in Other Comprehensive Income (Loss) on the Consolidated Statement of Comprehensive Income (Loss) (Effective Portion) for the Six Months Ended March 31,
Location of Derivative Gain or (Loss) Reclassified from Accumulated Other Comprehensive Income (Loss) on the Consolidated Balance Sheet into the Consolidated Statement of Income (Effective Portion)
Amount of Derivative Gain or (Loss) Reclassified from Accumulated Other Comprehensive Income (Loss) on the Consolidated Balance Sheet into the Consolidated Statement of Income (Effective Portion) for the Six Months Ended March 31,
Location of Derivative Gain or (Loss) Recognized in the Consolidated Statement of Income (Ineffective Portion and Amount Excluded from Effectiveness Testing)
Derivative Gain or (Loss) Recognized in the Consolidated Statement of Income (Ineffective Portion and Amount Excluded from Effectiveness Testing) for the Six Months Ended March 31,
 
2017
2016
 
2017
2016
 
2017
2016
Commodity Contracts
$
(7,960
)
$
96,217

Operating Revenue
$
43,429

$
114,242

Operating Revenue
$
(100
)
$
168

Commodity Contracts
(492
)
1,999

Purchased Gas
(1,958
)
4,450

Not Applicable


Foreign Currency Contracts
48

923

Operation and Maintenance Expense
(282
)
(287
)
Not Applicable


Total
$
(8,404
)
$
99,139

 
$
41,189

$
118,405

 
$
(100
)
$
168

 
 
 
 
 
 
 
 
 

Fair Value Hedges
 
The Company utilizes fair value hedges to mitigate risk associated with fixed price sales commitments, fixed price purchase commitments, and the decline in the value of certain natural gas held in storage. With respect to fixed price sales commitments, the Company enters into long positions to mitigate the risk of price increases for natural gas supplies that could occur after the Company enters into fixed price sales agreements with its customers. With respect to fixed price purchase commitments, the Company enters into short positions to mitigate the risk of price decreases that could occur after the Company locks into fixed price purchase deals with its suppliers. With respect to storage hedges, the Company enters into short positions to mitigate the risk of price decreases that could result in a lower of cost or net realizable value writedown of the value of natural gas in storage that is recorded in the Company’s financial statements. As of March 31, 2017, the Company’s Energy Marketing segment had fair value hedges covering approximately 15.8 Bcf (15.1 Bcf of fixed price sales commitments, 0.1 Bcf of fixed price purchase commitments and 0.6 Bcf of commitments related to the withdrawal of storage gas). For derivative instruments that are designated and qualify as a fair value hedge, the gain or loss on the derivative as well as the offsetting gain or loss on the hedged item attributable to the hedged risk completely offset each other in current earnings, as shown below.

Derivatives in Fair Value Hedging Relationships
Location of Gain or (Loss) on Derivative and Hedged Item Recognized in the Consolidated Statement of Income
Amount of Gain or (Loss) on Derivative Recognized in the Consolidated Statement of Income for the
Six Months Ended March 31, 2017
(In Thousands)
Amount of Gain or (Loss) on the Hedged Item Recognized in the Consolidated Statement of Income for the
Six Months Ended March 31, 2017
(In Thousands)
Commodity Contracts
Operating Revenues
$
2,954

$
(2,954
)
Commodity Contracts
Purchased Gas
$
226

$
(226
)
 
 
$
3,180

$
(3,180
)
 
Credit Risk
 
The Company may be exposed to credit risk on any of the derivative financial instruments that are in a gain position. Credit risk relates to the risk of loss that the Company would incur as a result of nonperformance by counterparties pursuant to the terms of their contractual obligations. To mitigate such credit risk, management performs a credit check, and then on a quarterly basis monitors counterparty credit exposure. The majority of the Company’s counterparties are financial institutions and energy traders. The Company has over-the-counter swap positions and applicable foreign currency forward contracts with sixteen counterparties of which thirteen are in a net gain position. On average, the Company had $4.8 million of credit exposure per counterparty in a gain position at March 31, 2017. The maximum credit exposure per counterparty in a gain position at March 31, 2017 was $10.0 million. As of March 31, 2017, no collateral was received from the counterparties by the Company. The Company's gain position on such derivative financial instruments had not exceeded the established thresholds at which the counterparties would be required to post collateral, nor had the counterparties' credit ratings declined to levels at which the counterparties were required to post collateral.
 
As of March 31, 2017, fourteen of the sixteen counterparties to the Company’s outstanding derivative instrument contracts (specifically the over-the-counter swaps and applicable foreign currency forward contracts) had a common credit-risk related contingency feature. In the event the Company’s credit rating increases or falls below a certain threshold (applicable debt ratings), the available credit extended to the Company would either increase or decrease. A decline in the Company’s credit rating, in and of itself, would not cause the Company to be required to increase the level of its hedging collateral deposits (in the form of cash deposits, letters of credit or treasury debt instruments). If the Company’s outstanding derivative instrument contracts were in a liability position (or if the liability were larger) and/or the Company’s credit rating declined, then additional hedging collateral deposits may be required.  At March 31, 2017, the fair market value of the derivative financial instrument assets with a credit-risk related contingency feature was $41.0 million according to the Company’s internal model (discussed in Note 2 — Fair Value Measurements). At March 31, 2017, the fair market value of the derivative financial instrument liabilities with a credit-risk related contingency feature was $0.6 million according to the Company's internal model (discussed in Note 2 - Fair Value Measurements). For its over-the-counter swap agreements and foreign currency forward contracts, no hedging collateral deposits were required to be posted by the Company at March 31, 2017.    
 
For its exchange traded futures contracts, the Company was required to post $1.8 million in hedging collateral deposits as of March 31, 2017. As these are exchange traded futures contracts, there are no specific credit-risk related contingency features. The Company posts or receives hedging collateral based on open positions and margin requirements it has with its counterparties.
 
The Company’s requirement to post hedging collateral deposits and the Company's right to receive hedging collateral deposits is based on the fair value determined by the Company’s counterparties, which may differ from the Company’s assessment of fair value. Hedging collateral deposits may also include closed derivative positions in which the broker has not cleared the cash from the account to offset the derivative liability. The Company records liabilities related to closed derivative positions in Other Accruals and Current Liabilities on the Consolidated Balance Sheet. These liabilities are relieved when the broker clears the cash from the hedging collateral deposit account. This is discussed in Note 1 under Hedging Collateral Deposits.
Income Taxes
Income Taxes
Income Taxes
 
The components of federal and state income taxes included in the Consolidated Statements of Income are as follows (in thousands): 
                                                         
Six Months Ended 
 March 31,
                                                         
2017
 
2016
Current Income Taxes 
 

 
 

Federal                                              
$
34,113

 
$
7,995

State                                                  
11,509

 
15,537

 
 
 
 
Deferred Income Taxes                                
 

 
 

Federal                                               
51,749

 
(197,982
)
State                                                    
12,032

 
(85,930
)
 
109,403

 
(260,380
)
Deferred Investment Tax Credit                            
(86
)
 
(174
)
 
 
 
 
Total Income Taxes                                      
$
109,317

 
$
(260,554
)
Presented as Follows:
 

 
 

Other Income
(86
)
 
(174
)
Income Tax Expense (Benefit)
109,403

 
(260,380
)
 
 
 
 
Total Income Taxes
$
109,317

 
$
(260,554
)


Total income taxes as reported differ from the amounts that were computed by applying the federal income tax rate to income (loss) before income taxes.  The following is a reconciliation of this difference (in thousands): 
 
Six Months Ended 
 March 31,
 
2017
 
2016
U.S. Income (Loss) Before Income Taxes
$
287,508

 
$
(597,350
)
 
 

 
 

Income Tax Expense (Benefit), Computed at U.S. Federal Statutory Rate of 35%
$
100,628

 
$
(209,073
)
State Income Taxes (Benefit)
15,302

 
(45,756
)
Miscellaneous
(6,613
)
 
(5,725
)
 
 
 
 
Total Income Taxes
$
109,317

 
$
(260,554
)

 
During the quarter ended March 31, 2017, the balance of unrecognized tax benefits increased by $1.3 million. This balance of unrecognized tax benefits would favorably impact the effective tax rate, if recognized.
Capitalization
Capitalization
Capitalization
 
Common Stock.  During the six months ended March 31, 2017, the Company issued 31,446 original issue shares of common stock as a result of stock option and SARs exercises, 74,547 original issue shares of common stock for restricted stock units that vested and 43,484 original issue shares of common stock for performance shares that vested.  In addition, the Company issued 90,361 original issue shares of common stock for the Direct Stock Purchase and Dividend Reinvestment Plan and 51,727 original issue shares of common stock for the Company’s 401(k) plans.  The Company also issued 10,357 original issue shares of common stock to the non-employee directors of the Company who receive compensation under the Company’s 2009 Non-Employee Director Equity Compensation Plan, as partial consideration for the directors’ services during the six months ended March 31, 2017.  Holders of stock options, SARs, restricted share awards or restricted stock units will often tender shares of common stock to the Company for payment of option exercise prices and/or applicable withholding taxes.  During the six months ended March 31, 2017, 45,740 shares of common stock were tendered to the Company for such purposes.  The Company considers all shares tendered as cancelled shares restored to the status of authorized but unissued shares, in accordance with New Jersey law.
 
Current Portion of Long-Term Debt.    None of the Company’s long-term debt at March 31, 2017 will mature within the following twelve-month period.
Commitments And Contingencies
Commitments And Contingencies
Commitments and Contingencies
 
Environmental Matters.  The Company is subject to various federal, state and local laws and regulations relating to the protection of the environment.  The Company has established procedures for the ongoing evaluation of its operations to identify potential environmental exposures and to comply with regulatory requirements.  It is the Company’s policy to accrue estimated environmental clean-up costs (investigation and remediation) when such amounts can reasonably be estimated and it is probable that the Company will be required to incur such costs. 
    
At March 31, 2017, the Company has estimated its remaining clean-up costs related to former manufactured gas plant sites and third party waste disposal sites will be approximately $3.4 million.  The Company expects to recover its environmental clean-up costs through rate recovery over a period of approximately 4 years.

The Company's estimated liability for clean-up costs discussed above includes a $1.8 million estimated liability related to the remediation of a former manufactured gas plant site located in New York. In February 2009, the Company received approval from the NYDEC of a Remedial Design Work Plan (RDWP) for this site. In October 2010, the Company submitted a RDWP addendum to conduct additional Preliminary Design Investigation field activities necessary to design a successful remediation. As a result of this work, the Company submitted to the NYDEC a proposal to amend the NYDEC’s Record of Decision remedy for the site.  In April 2013, the NYDEC approved the Company’s proposed amendment.  Final remedial design work for the site was completed, and active remedial work has also been completed. Restoration work is complete.  The Company continues to be responsible for future ongoing monitoring and long-term maintenance at the site.
 
The Company is currently not aware of any material additional exposure to environmental liabilities.  However, changes in environmental laws and regulations, new information or other factors could have an adverse financial impact on the Company.
 
Other.  The Company is involved in other litigation and regulatory matters arising in the normal course of business.  These other matters may include, for example, negligence claims and tax, regulatory or other governmental audits, inspections, investigations and other proceedings.  These matters may involve state and federal taxes, safety, compliance with regulations, rate base, cost of service and purchased gas cost issues, among other things.  While these other matters arising in the normal course of business could have a material effect on earnings and cash flows in the period in which they are resolved, an estimate of the possible loss or range of loss, if any, cannot be made at this time.
Business Segment Information
Business Segment Information
Business Segment Information    
 
The Company reports financial results for five segments: Exploration and Production, Pipeline and Storage, Gathering, Utility and Energy Marketing.  The division of the Company’s operations into reportable segments is based upon a combination of factors including differences in products and services, regulatory environment and geographic factors.
 
The data presented in the tables below reflect financial information for the segments and reconciliations to consolidated amounts.  As stated in the 2016 Form 10-K, the Company evaluates segment performance based on income before discontinued operations, extraordinary items and cumulative effects of changes in accounting (when applicable).  When these items are not applicable, the Company evaluates performance based on net income.  There have not been any changes in the basis of segmentation nor in the basis of measuring segment profit or loss from those used in the Company’s 2016 Form 10-K.  A listing of segment assets at March 31, 2017 and September 30, 2016 is shown in the tables below.  
Quarter Ended March 31, 2017 (Thousands)
 
 
 
 
 
 
 
Exploration and Production
Pipeline and Storage
Gathering
Utility
Energy Marketing
Total Reportable Segments
All Other
Corporate and Intersegment Eliminations
Total Consolidated
Revenue from External Customers
$159,553
$53,163
$26
$257,949
$50,940
$521,631
$218
$226
$522,075
Intersegment Revenues
$—
$22,592
$27,936
$6,096
$16
$56,640
$—
$(56,640)
$—
Segment Profit: Net Income (Loss)
$33,769
$19,256
$10,285
$25,581
$905
$89,796
$(221)
$(291)
$89,284

 


 





Six Months Ended March 31, 2017 (Thousands)
 
 
 
 
 
 
 
Exploration and Production
Pipeline and Storage
Gathering
Utility
Energy Marketing
Total Reportable Segments
All Other
Corporate and Intersegment Eliminations
Total Consolidated
Revenue from External Customers
$320,485
$106,164
$52
$428,919
$87,750
$943,370
$772
$434
$944,576
Intersegment Revenues
$—
$44,746
$55,776
$7,922
$35
$108,479
$—
$(108,479)
$—
Segment Profit: Net Income (Loss)
$68,849
$38,624
$21,266
$46,755
$2,687
$178,181
$(400)
$410
$178,191
 
 
 
 
 
 
 
 
 
 
(Thousands)
Exploration and Production
Pipeline and Storage
Gathering
Utility
Energy Marketing
Total Reportable Segments
All Other
Corporate and Intersegment Eliminations
Total Consolidated
Segment Assets:
 
 
 
 
 
 
 
 
 
At March 31, 2017
$1,292,230
$1,718,862
$553,719
$2,108,549
$74,404
$5,747,764
$76,630
$(19,719)
$5,804,675
At September 30, 2016
$1,323,081
$1,680,734
$534,259
$2,021,514
$63,392
$5,622,980
$77,138
$(63,731)
$5,636,387

Quarter Ended March 31, 2016 (Thousands)
 
 
 
 
 
 
 
Exploration and Production
Pipeline and Storage
Gathering
Utility
Energy Marketing
Total Reportable Segments
All Other
Corporate and Intersegment Eliminations
Total Consolidated
Revenue from External Customers
$143,783
$56,276
$113
$212,737
$35,436
$448,345
$561
$226
$449,132
Intersegment Revenues
$—
$23,292
$21,545
$5,364
$312
$50,513
$—
$(50,513)
$—
Segment Profit: Net Income (Loss)
$(213,335)
$21,194
$7,568
$31,960
$3,484
$(149,129)
$(23)
$1,465
$(147,687)
Six Months Ended March 31, 2016 (Thousands)
 
 
 
 
 
 
 
Exploration and Production
Pipeline and Storage
Gathering
Utility
Energy Marketing
Total Reportable Segments
All Other
Corporate and Intersegment Eliminations
Total Consolidated
Revenue from External Customers
$295,749
$109,630
$238
$356,585
$60,420
$822,622
$1,266
$439
$824,327
Intersegment Revenues
$—
$45,477
$40,184
$9,028
$624
$95,313
$—
$(95,313)
$—
Segment Profit: Net Income (Loss)
$(450,421)
$42,470
$12,490
$50,566
$4,707
$(340,188)
$166
$3,226
$(336,796)
 
 
 
 
 
 
 
 
 
 
Retirement Plan And Other Post-Retirement Benefits
Retirement Plan and Other Post-Retirement Benefits
Retirement Plan and Other Post-Retirement Benefits
 
Components of Net Periodic Benefit Cost (in thousands):
 
 
Retirement Plan
 
Other Post-Retirement Benefits
Three Months Ended March 31,
2017
2016
 
2017
2016





 




Service Cost
$
2,992

$
2,928

 
$
612

$
583

Interest Cost
9,596

10,579

 
4,752

5,096

Expected Return on Plan Assets
(14,929
)
(14,842
)
 
(7,865
)
(7,883
)
Amortization of Prior Service Cost (Credit)
264

308

 
(107
)
(228
)
Amortization of Losses
10,672

8,062

 
4,604

1,382

Net Amortization and Deferral for Regulatory Purposes (Including Volumetric Adjustments) (1)
6,234

5,609

 
3,790

6,599






 




Net Periodic Benefit Cost
$
14,829

$
12,644

 
$
5,786

$
5,549

 
 
 
 
 
 
 
Retirement Plan
 
Other Post-Retirement Benefits
Six Months Ended March 31,
2017
2016
 
2017
2016
 
 
 
 
 
 
Service Cost
$
5,984

$
5,855

 
$
1,224

$
1,166

Interest Cost
19,192

21,158

 
9,504

10,193

Expected Return on Plan Assets
(29,859
)
(29,685
)
 
(15,729
)
(15,768
)
Amortization of Prior Service Cost (Credit)
529

617

 
(214
)
(456
)
Amortization of Losses
21,343

16,124

 
9,207

2,765

Net Amortization and Deferral for Regulatory Purposes (Including Volumetric Adjustments) (1)
6,770

7,516

 
5,102

10,720

 
 
 
 
 
 
Net Periodic Benefit Cost
$
23,959

$
21,585

 
$
9,094

$
8,620

 
 
 
 
 
 
(1) 
The Company’s policy is to record retirement plan and other post-retirement benefit costs in the Utility segment on a volumetric basis to reflect the fact that the Utility segment experiences higher throughput of natural gas in the winter months and lower throughput of natural gas in the summer months.
 
Employer Contributions.    During the six months ended March 31, 2017, the Company contributed $15.1 million to its tax-qualified, noncontributory defined-benefit retirement plan (Retirement Plan) and $2.2 million to its VEBA trusts and 401(h) accounts for its other post-retirement benefits.  In the remainder of 2017, the Company expects to contribute up to $5.0 million to the Retirement Plan. In the remainder of 2017, the Company expects its contributions to the VEBA trusts and 401(h) accounts to be in the range of $1.0 million to $3.0 million.
Regulatory Matters
Regulatory Matters
Regulatory Matters
    
On April 28, 2016, Distribution Corporation commenced a rate case by filing proposed tariff amendments and supporting testimony requesting approval to increase its annual revenues by approximately $41.7 million. Distribution Corporation explained in the filing that its request for rate relief was necessitated by a revenue requirement driven primarily by rate base growth, higher operating expense and higher depreciation expense, among other things. On January 23, 2017, the administrative law judge assigned to the proceeding issued a recommended decision (RD) in the case. The RD, as revised on January 26, 2017, recommended a rate increase designed to provide additional annual revenues of $8.5 million, an equity ratio, subject to update of 42.3% based on the Company’s equity ratio, and a cost of equity, subject to update of 8.6%. On April 20, 2017, the NYPSC issued an Order adopting some provisions of the RD and modifying or rejecting others. The Order provides for an annual rate increase of $5.9 million. The rate increase became effective May 1, 2017. The Order further provides for a return on equity of 8.7%, and established an equity ratio of 42.9%. The Order also directs the implementation of an earnings sharing mechanism to be in place beginning on April 1, 2018, only if the Company does not file for new rates to become effective on or before October 1, 2018. The Company is currently evaluating the Order as well as the possibility of seeking judicial review of the Order.
FERC Rate Proceedings
Supply Corporation's current rate settlement requires a rate case filing no later than December 31, 2019 and prohibits any party from seeking to initiate a rate case proceeding before September 30, 2017. Under the settlement, Supply Corporation reduced its maximum reservation, capacity, demand and deliverability rates by 2% on November 1, 2015 and reduced those rates by an additional 2% on November 1, 2016.
Empire's current rate settlement, which was approved by FERC on December 13, 2016, reduces certain of Empire’s maximum transportation rates over a 14-month period, which, based on current contracts, is estimated to reduce Empire’s revenues on a yearly basis by between $3 million to $4 million. The settlement also reduced Empire’s depreciation rate from 2.5% to 2%. In addition, the settlement provides an annual revenue sharing mechanism, pursuant to which non-expansion transportation revenues exceeding $73.5 million are shared on a tiered basis. Under the settlement, Empire will be required to make a general rate filing no later than July 1, 2021.
Subsequent Event
Subsequent Event
Subsequent Event
On February 3, 2017, Supply Corporation and Empire received FERC authorization to proceed with the Northern Access 2016 project described herein. On April 7, 2017, the NYDEC issued a Notice of Denial of the federal Clean Water Act Section 401 Water Quality Certification and other state stream and wetland permits for the New York portion of the project (the Water Quality Certification for the Pennsylvania portion of the project was received on January 27, 2017). On April 21, 2017, Supply Corporation and Empire appealed the NYDEC’s decision with regard to the Water Quality Certification to the United States Court of Appeals for the Second Circuit. In light of the pending legal action, the Company has not yet determined a revised target in-service date. As a result of the decision of the NYDEC, Supply Corporation and Empire evaluated the capitalized project costs for impairment as of March 31, 2017 and determined that an impairment charge was not required. The evaluation considered probability weighted scenarios of undiscounted future net cash flows, including a scenario assuming successful resolution with the NYDEC and construction of the pipeline, as well as a scenario where the project does not proceed. Further developments or indicators of an unfavorable resolution could result in the impairment of a significant portion of the project costs, which totaled $67.8 million at March 31, 2017. The project costs are included within Property, Plant and Equipment and Deferred Charges on the Consolidated Balance Sheet.
Summary Of Significant Accounting Policies (Policy)
Principles of Consolidation.  The Company consolidates all entities in which it has a controlling financial interest.  All significant intercompany balances and transactions are eliminated. The Company uses proportionate consolidation when accounting for drilling arrangements related to oil and gas producing properties accounted for under the full cost method of accounting.
 
The preparation of the consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period.  Actual results could differ from those estimates.
Reclassification. Certain prior year amounts have been reclassified to conform with current year presentation.
Earnings for Interim Periods.  The Company, in its opinion, has included all adjustments (which consist of only normally recurring adjustments, unless otherwise disclosed in this Form 10-Q) that are necessary for a fair statement of the results of operations for the reported periods. The consolidated financial statements and notes thereto, included herein, should be read in conjunction with the financial statements and notes for the years ended September 30, 2016, 2015 and 2014 that are included in the Company's 2016 Form 10-K.  The consolidated financial statements for the year ended September 30, 2017 will be audited by the Company's independent registered public accounting firm after the end of the fiscal year.
 
The earnings for the six months ended March 31, 2017 should not be taken as a prediction of earnings for the entire fiscal year ending September 30, 2017.  Most of the business of the Utility and Energy Marketing segments is seasonal in nature and is influenced by weather conditions.  Due to the seasonal nature of the heating business in the Utility and Energy Marketing segments, earnings during the winter months normally represent a substantial part of the earnings that those segments are expected to achieve for the entire fiscal year.  The Company’s business segments are discussed more fully in Note 7 – Business Segment Information.
Consolidated Statements of Cash Flows.  For purposes of the Consolidated Statements of Cash Flows, the Company considers all highly liquid debt instruments purchased with a maturity of generally three months or less to be cash equivalents.
Hedging Collateral Deposits.  This is an account title for cash held in margin accounts funded by the Company to serve as collateral for hedging positions.  In accordance with its accounting policy, the Company does not offset hedging collateral deposits paid or received against related derivative financial instruments liability or asset balances.
Gas Stored Underground.  In the Utility segment, gas stored underground is carried at lower of cost or net realizable value, on a LIFO method.  Gas stored underground normally declines during the first and second quarters of the year and is replenished during the third and fourth quarters.  In the Utility segment, the current cost of replacing gas withdrawn from storage is recorded in the Consolidated Statements of Income and a reserve for gas replacement is recorded in the Consolidated Balance Sheets under the caption “Other Accruals and Current Liabilities.”  Such reserve, which amounted to $20.2 million at March 31, 2017, is reduced to zero by September 30 of each year as the inventory is replenished.
Property, Plant and Equipment.  In the Company’s Exploration and Production segment, oil and gas property acquisition, exploration and development costs are capitalized under the full cost method of accounting. Under this methodology, all costs associated with property acquisition, exploration and development activities are capitalized, including internal costs directly identified with acquisition, exploration and development activities. The internal costs that are capitalized do not include any costs related to production, general corporate overhead, or similar activities. The Company does not recognize any gain or loss on the sale or other disposition of oil and gas properties unless the gain or loss would significantly alter the relationship between capitalized costs and proved reserves of oil and gas attributable to a cost center.
 
Capitalized costs include costs related to unproved properties, which are excluded from amortization until proved reserves are found or it is determined that the unproved properties are impaired.  Such costs amounted to $114.3 million and $135.3 million at March 31, 2017 and September 30, 2016, respectively.  All costs related to unproved properties are reviewed quarterly to determine if impairment has occurred. The amount of any impairment is transferred to the pool of capitalized costs being amortized.
 
Capitalized costs are subject to the SEC full cost ceiling test. The ceiling test, which is performed each quarter, determines a limit, or ceiling, on the amount of property acquisition, exploration and development costs that can be capitalized. The ceiling under this test represents (a) the present value of estimated future net cash flows, excluding future cash outflows associated with settling asset retirement obligations that have been accrued on the balance sheet, using a discount factor of 10%, which is computed by applying prices of oil and gas (as adjusted for hedging) to estimated future production of proved oil and gas reserves as of the date of the latest balance sheet, less estimated future expenditures, plus (b) the cost of unevaluated properties not being depleted, less (c) income tax effects related to the differences between the book and tax basis of the properties. The natural gas and oil prices used to calculate the full cost ceiling are based on an unweighted arithmetic average of the first day of the month oil and gas prices for each month within the twelve-month period prior to the end of the reporting period. If capitalized costs, net of accumulated depreciation, depletion and amortization and related deferred income taxes, exceed the ceiling at the end of any quarter, a permanent impairment is required to be charged to earnings in that quarter.  At March 31, 2017, the ceiling exceeded the book value of the oil and gas properties by approximately $201.0 million. In adjusting estimated future cash flows for hedging under the ceiling test at March 31, 2017, estimated future net cash flows were increased by $105.4 million.

On December 1, 2015, Seneca and IOG - CRV Marcellus, LLC (IOG), an affiliate of IOG Capital, LP, and funds managed by affiliates of Fortress Investment Group, LLC, executed a joint development agreement that allows IOG to participate in the development of certain oil and gas interests owned by Seneca in Elk, McKean and Cameron Counties, Pennsylvania. On June 13, 2016, Seneca and IOG executed an extension of the joint development agreement. Under the terms of the extended agreement, Seneca and IOG will jointly participate in a program to develop up to 75 Marcellus wells, with Seneca serving as program operator. Under the original joint development agreement, IOG had committed to develop 42 Marcellus wells. IOG will hold an 80% working interest in all of the joint development wells. In total, IOG is expected to fund approximately $325 million for its 80% working interest in the 75 joint development wells. Of this amount, IOG has funded $251.4 million as of March 31, 2017, which includes $163.9 million of cash ($137.3 million in fiscal 2016 and $26.6 million in fiscal 2017) that Seneca had received in recognition of IOG funding that is due to Seneca for costs previously incurred to develop a portion of the first 75 joint development wells. The cash proceeds were recorded by Seneca as a $163.9 million reduction of property, plant and equipment. The remainder funded was incurred for joint development expenditures. As the fee-owner of the property’s mineral rights, Seneca retains a 7.5% royalty interest and the remaining 20% working interest (26% net revenue interest) in 56 of the joint development wells. In the remaining 19 wells, Seneca retains a 20% working and net revenue interest. Seneca’s working interest under the agreement will increase to 85% after IOG achieves a 15% internal rate of return.
Accumulated Other Comprehensive Loss.  The components of Accumulated Other Comprehensive Loss and changes for the six months ended March 31, 2017 and 2016, net of related tax effect, are as follows (amounts in parentheses indicate debits) (in thousands): 
 
Gains and Losses on Derivative Financial Instruments
Gains and Losses on Securities Available for Sale
Funded Status of the Pension and Other Post-Retirement Benefit Plans
Total
Three Months Ended March 31, 2017
 
 
 
 
Balance at January 1, 2017
$
16,570

$
5,047

$
(76,476
)
$
(54,859
)
Other Comprehensive Gains and Losses Before Reclassifications
25,745

1,081


26,826

Amounts Reclassified From Other Comprehensive Income (Loss)
(6,058
)


(6,058
)
Balance at March 31, 2017
$
36,257

$
6,128

$
(76,476
)
$
(34,091
)
Six Months Ended March 31, 2017
 
 
 
 
Balance at October 1, 2016
$
64,782

$
6,054

$
(76,476
)
$
(5,640
)
Other Comprehensive Gains and Losses Before Reclassifications
(4,705
)
543


(4,162
)
Amounts Reclassified From Other Comprehensive Income (Loss)
(23,820
)
(469
)

(24,289
)
Balance at March 31, 2017
$
36,257

$
6,128

$
(76,476
)
$
(34,091
)
Three Months Ended March 31, 2016
 
 
 
 
Balance at January 1, 2016
$
162,728

$
5,522

$
(69,794
)
$
98,456

Other Comprehensive Gains and Losses Before Reclassifications
19,578

12


19,590

Amounts Reclassified From Other Comprehensive Income (Loss)
(35,635
)
(225
)

(35,860
)
Balance at March 31, 2016
$
146,671

$
5,309

$
(69,794
)
$
82,186

Six Months Ended March 31, 2016
 
 
 
 
Balance at October 1, 2015
$
157,197

$
5,969

$
(69,794
)
$
93,372

Other Comprehensive Gains and Losses Before Reclassifications
64,273

(435
)

63,838

Amounts Reclassified From Other Comprehensive Income (Loss)
(74,799
)
(225
)

(75,024
)
Balance at March 31, 2016
$
146,671

$
5,309

$
(69,794
)
$
82,186

 
 
 
 
 

Reclassifications Out of Accumulated Other Comprehensive Loss.  The details about the reclassification adjustments out of accumulated other comprehensive loss for the six months ended March 31, 2017 and 2016 are as follows (amounts in parentheses indicate debits to the income statement) (in thousands):
Details About Accumulated Other Comprehensive Income (Loss) Components
Amount of Gain or (Loss) Reclassified from Accumulated Other Comprehensive Loss
Affected Line Item in the Statement Where Net Income (Loss) is Presented
 
Three Months Ended March 31,
Six Months Ended March 31,
 
 
2017
2016
2017
2016
 
Gains (Losses) on Derivative Financial Instrument Cash Flow Hedges:
 
 
 
 
 
     Commodity Contracts

$12,109


$57,914


$43,429


$114,242

Operating Revenues
     Commodity Contracts
(1,498
)
3,530

(1,958
)
4,450

Purchased Gas
     Foreign Currency Contracts
(139
)
(209
)
(282
)
(287
)
Operation and Maintenance Expense
Gains (Losses) on Securities Available for Sale

388

741

388

Other Income
 
10,472

61,623

41,930

118,793

Total Before Income Tax
 
(4,414
)
(25,763
)
(17,641
)
(43,769
)
Income Tax Expense
 

$6,058


$35,860


$24,289


$75,024

Net of Tax


Other Current Assets.  The components of the Company’s Other Current Assets are as follows (in thousands):
                            
At March 31, 2017
 
At September 30, 2016
 
 
 
 
Prepayments
$
5,284

 
$
10,919

Prepaid Property and Other Taxes
22,563

 
13,138

Federal Income Taxes Receivable

 
11,758

State Income Taxes Receivable
5,237

 
3,961

Fair Values of Firm Commitments

 
3,962

Regulatory Assets
18,501

 
15,616

 
$
51,585

 
$
59,354

Other Accruals and Current Liabilities.  The components of the Company’s Other Accruals and Current Liabilities are as follows (in thousands):
                            
At March 31, 2017
 
At September 30, 2016
 
 
 
 
Accrued Capital Expenditures
$
13,964

 
$
26,796

Regulatory Liabilities
29,579

 
14,725

Reserve for Gas Replacement
20,215

 

Federal Income Taxes Payable
9,355

 

Other
33,174

 
32,909

 
$
106,287

 
$
74,430

Earnings Per Common Share.  Basic earnings per common share is computed by dividing income or loss by the weighted average number of common shares outstanding for the period. Diluted earnings per common share reflects the potential dilution that could occur if securities or other contracts to issue common stock were exercised or converted into common stock.  For purposes of determining earnings per common share, the potentially dilutive securities the Company has outstanding are stock options, SARs, restricted stock units and performance shares.  For the quarter and six months ended March 31, 2017, the diluted weighted average shares outstanding shown on the Consolidated Statements of Income reflects the potential dilution as a result of these securities as determined using the Treasury Stock Method.  Stock options, SARs, restricted stock units and performance shares that are antidilutive are excluded from the calculation of diluted earnings per common share. There were 157,554 securities and 158,211 securities excluded as being antidilutive for the quarter and six months ended March 31, 2017, respectively. As the Company recognized a net loss for both the quarter and six months ended March 31, 2016, the aforementioned potentially dilutive securities, amounting to 386,626 securities and 451,291 securities, were not recognized in the diluted earnings per share calculation for the quarter and six months ended March 31, 2016, respectively.
 
Stock-Based Compensation.  The Company granted 184,148 performance shares during the six months ended March 31, 2017. The weighted average fair value of such performance shares was $56.39 per share for the six months ended March 31, 2017. Performance shares are an award constituting units denominated in common stock of the Company, the number of which may be adjusted over a performance cycle based upon the extent to which performance goals have been satisfied.  Earned performance shares may be distributed in the form of shares of common stock of the Company, an equivalent value in cash or a combination of cash and shares of common stock of the Company, as determined by the Company. The performance shares do not entitle the participant to receive dividends during the vesting period.
 
Half of the performance shares granted during the six months ended March 31, 2017 must meet a performance goal related to relative return on capital over the performance cycle of October 1, 2016 to September 30, 2019.  The performance goal over the performance cycle is the Company’s total return on capital relative to the total return on capital of other companies in a group selected by the Compensation Committee (“Report Group”).  Total return on capital for a given company means the average of the Report Group companies’ returns on capital for each twelve month period corresponding to each of the Company’s fiscal years during the performance cycle, based on data reported for the Report Group companies in the Bloomberg database.  The number of these performance shares that will vest and be paid will depend upon the Company’s performance relative to the Report Group and not upon the absolute level of return achieved by the Company.  The fair value of these performance shares is calculated by multiplying the expected number of shares that will be issued by the average market price of Company common stock on the date of grant reduced by the present value of forgone dividends over the vesting term of the award.  The fair value is recorded as compensation expense over the vesting term of the award.  The other half of the performance shares granted during the six months ended March 31, 2017 must meet a performance goal related to relative total shareholder return over the performance cycle of October 1, 2016 to September 30, 2019.  The performance goal over the performance cycle is the Company’s three-year total shareholder return relative to the three-year total shareholder return of the other companies in the Report Group.  Three-year shareholder return for a given company will be based on the data reported for that company (with the starting and ending stock prices over the performance cycle calculated as the average closing stock price for the prior calendar month and with dividends reinvested in that company’s securities at each ex-dividend date) in the Bloomberg database.  The number of these total shareholder return performance shares ("TSR performance shares") that will vest and be paid will depend upon the Company’s performance relative to the Report Group and not upon the absolute level of return achieved by the Company.  The fair value price at the date of grant for the TSR performance shares is determined using a Monte Carlo simulation technique, which includes a reduction in value for the present value of forgone dividends over the vesting term of the award.  This price is multiplied by the number of TSR performance shares awarded, the result of which is recorded as compensation expense over the vesting term of the award.
 
The Company granted 87,143 non-performance based restricted stock units during the six months ended March 31, 2017.  The weighted average fair value of such non-performance based restricted stock units was $52.13 per share for the six months ended March 31, 2017. Restricted stock units represent the right to receive shares of common stock of the Company (or the equivalent value in cash or a combination of cash and shares of common stock of the Company, as determined by the Company) at the end of a specified time period. These non-performance based restricted stock units do not entitle the participant to receive dividends during the vesting period. The accounting for non-performance based restricted stock units is the same as the accounting for restricted share awards, except that the fair value at the date of grant of the restricted stock units must be reduced by the present value of forgone dividends over the vesting term of the award.
 
New Authoritative Accounting and Financial Reporting Guidance. In May 2014, the FASB issued authoritative guidance regarding revenue recognition. The authoritative guidance provides a single, comprehensive revenue recognition model for all contracts with customers to improve comparability. The revenue standard contains principles that an entity will apply to determine the measurement of revenue and timing of when it is recognized. The original effective date of this authoritative guidance was as of the Company's first quarter of fiscal 2018. However, the FASB has delayed the effective date of the new revenue standard by one year, and the guidance will now be effective as of the Company's first quarter of fiscal 2019. Working towards this implementation date, the Company is currently evaluating the guidance and the various issues identified by industry based revenue recognition task forces and intends to begin analyzing its contractual arrangements with customers in the second half of fiscal 2017.
In February 2016, the FASB issued authoritative guidance requiring organizations that lease assets to recognize on the balance sheet the assets and liabilities for the rights and obligations created by all leases, regardless of whether they are considered to be capital leases or operating leases. The FASB’s previous authoritative guidance required organizations that lease assets to recognize on the balance sheet the assets and liabilities for the rights and obligations created by capital leases while excluding operating leases from balance sheet recognition. The new authoritative guidance will be effective as of the Company’s first quarter of fiscal 2020, with early adoption permitted. The Company does not anticipate early adoption and is currently evaluating the provisions of the revised guidance.
In March 2016, the FASB issued authoritative guidance simplifying several aspects of the accounting for stock-based compensation. The Company adopted this guidance effective as of October 1, 2016, recognizing a cumulative effect adjustment that increased retained earnings by $31.9 million. The cumulative effect represents the tax benefit of previously unrecognized tax deductions in excess of stock compensation recorded for financial reporting purposes. On a prospective basis, the tax effect of all future differences between stock compensation recorded for financial reporting purposes and actual tax deductions for stock compensation will be recognized upon vesting or settlement as income tax expense or benefit in the income statement. From a statement of cash flows perspective, the tax benefits relating to differences between stock compensation recorded for financial reporting purposes and actual tax deductions for stock compensation are now included in cash provided by operating activities instead of cash provided by financing activities. The changes to the statement of cash flows have been applied prospectively and prior periods have not been adjusted.
In March 2017, the FASB issued authoritative guidance related to the presentation of net periodic pension cost and net periodic postretirement benefit cost. The new guidance requires segregation of the service cost component from the other components of net periodic pension cost and net periodic postretirement benefit cost for financial reporting purposes. The service cost component is to be presented on the income statement in the same line items as other compensation costs included within Operating Expenses and the other components of net periodic pension cost and net periodic postretirement benefit cost are to be presented on the income statement below the subtotal labeled Operating Income (Loss). Under this guidance, the service cost component shall be the only component eligible to be capitalized as part of the cost of inventory or property, plant and equipment. The new guidance will be effective as of the Company’s first quarter of fiscal 2019, with early adoption permitted. The Company is currently evaluating the interaction of this authoritative guidance with the various regulatory provisions concerning pension and postretirement benefit costs in the Company’s Utility and Pipeline and Storage segments.
Summary Of Significant Accounting Policies (Tables)
The components of Accumulated Other Comprehensive Loss and changes for the six months ended March 31, 2017 and 2016, net of related tax effect, are as follows (amounts in parentheses indicate debits) (in thousands): 
 
Gains and Losses on Derivative Financial Instruments
Gains and Losses on Securities Available for Sale
Funded Status of the Pension and Other Post-Retirement Benefit Plans
Total
Three Months Ended March 31, 2017
 
 
 
 
Balance at January 1, 2017
$
16,570

$
5,047

$
(76,476
)
$
(54,859
)
Other Comprehensive Gains and Losses Before Reclassifications
25,745

1,081


26,826

Amounts Reclassified From Other Comprehensive Income (Loss)
(6,058
)


(6,058
)
Balance at March 31, 2017
$
36,257

$
6,128

$
(76,476
)
$
(34,091
)
Six Months Ended March 31, 2017
 
 
 
 
Balance at October 1, 2016
$
64,782

$
6,054

$
(76,476
)
$
(5,640
)
Other Comprehensive Gains and Losses Before Reclassifications
(4,705
)
543


(4,162
)
Amounts Reclassified From Other Comprehensive Income (Loss)
(23,820
)
(469
)

(24,289
)
Balance at March 31, 2017
$
36,257

$
6,128

$
(76,476
)
$
(34,091
)
Three Months Ended March 31, 2016
 
 
 
 
Balance at January 1, 2016
$
162,728

$
5,522

$
(69,794
)
$
98,456

Other Comprehensive Gains and Losses Before Reclassifications
19,578

12


19,590

Amounts Reclassified From Other Comprehensive Income (Loss)
(35,635
)
(225
)

(35,860
)
Balance at March 31, 2016
$
146,671

$
5,309

$
(69,794
)
$
82,186

Six Months Ended March 31, 2016
 
 
 
 
Balance at October 1, 2015
$
157,197

$
5,969

$
(69,794
)
$
93,372

Other Comprehensive Gains and Losses Before Reclassifications
64,273

(435
)

63,838

Amounts Reclassified From Other Comprehensive Income (Loss)
(74,799
)
(225
)

(75,024
)
Balance at March 31, 2016
$
146,671

$
5,309

$
(69,794
)
$
82,186

 
 
 
 
 

The details about the reclassification adjustments out of accumulated other comprehensive loss for the six months ended March 31, 2017 and 2016 are as follows (amounts in parentheses indicate debits to the income statement) (in thousands):
Details About Accumulated Other Comprehensive Income (Loss) Components
Amount of Gain or (Loss) Reclassified from Accumulated Other Comprehensive Loss
Affected Line Item in the Statement Where Net Income (Loss) is Presented
 
Three Months Ended March 31,
Six Months Ended March 31,
 
 
2017
2016
2017
2016
 
Gains (Losses) on Derivative Financial Instrument Cash Flow Hedges:
 
 
 
 
 
     Commodity Contracts

$12,109


$57,914


$43,429


$114,242

Operating Revenues
     Commodity Contracts
(1,498
)
3,530

(1,958
)
4,450

Purchased Gas
     Foreign Currency Contracts
(139
)
(209
)
(282
)
(287
)
Operation and Maintenance Expense
Gains (Losses) on Securities Available for Sale

388

741

388

Other Income
 
10,472

61,623

41,930

118,793

Total Before Income Tax
 
(4,414
)
(25,763
)
(17,641
)
(43,769
)
Income Tax Expense
 

$6,058


$35,860


$24,289


$75,024

Net of Tax

The components of the Company’s Other Current Assets are as follows (in thousands):
                            
At March 31, 2017
 
At September 30, 2016
 
 
 
 
Prepayments
$
5,284

 
$
10,919

Prepaid Property and Other Taxes
22,563

 
13,138

Federal Income Taxes Receivable

 
11,758

State Income Taxes Receivable
5,237

 
3,961

Fair Values of Firm Commitments

 
3,962

Regulatory Assets
18,501

 
15,616

 
$
51,585

 
$
59,354

The components of the Company’s Other Accruals and Current Liabilities are as follows (in thousands):
                            
At March 31, 2017
 
At September 30, 2016
 
 
 
 
Accrued Capital Expenditures
$
13,964

 
$
26,796

Regulatory Liabilities
29,579

 
14,725

Reserve for Gas Replacement
20,215

 

Federal Income Taxes Payable
9,355

 

Other
33,174

 
32,909

 
$
106,287

 
$
74,430

Fair Value Measurements (Tables)
The following table sets forth, by level within the fair value hierarchy, the Company's financial assets and liabilities (as applicable) that were accounted for at fair value on a recurring basis as of March 31, 2017 and September 30, 2016.  Financial assets and liabilities are classified in their entirety based on the lowest level of input that is significant to the fair value measurement. The fair value presentation for over the counter swaps combines gas and oil swaps because a significant number of the counterparties enter into both gas and oil swap agreements with the Company.  
Recurring Fair Value Measures
At fair value as of March 31, 2017
(Thousands of Dollars)   
Level 1
 
Level 2
 
Level 3
 
Netting Adjustments(1)
 
Total(1)
Assets:
 

 
 

 
 

 
 

 
 

Cash Equivalents – Money Market Mutual Funds
$
214,213

 
$

 
$

 
$

 
$
214,213

Derivative Financial Instruments:
 

 
 

 
 

 
 

 
 

Commodity Futures Contracts – Gas
2,449

 

 

 
(1,068
)
 
1,381

Over the Counter Swaps – Gas and Oil

 
73,525

 

 
(10,177
)
 
63,348

Foreign Currency Contracts

 
48

 

 
(48
)
 

Other Investments:
 

 
 

 
 

 
 

 
 

Balanced Equity Mutual Fund
34,664

 

 

 

 
34,664

Fixed Income Mutual Fund
38,460

 

 

 

 
38,460

Common Stock – Financial Services Industry
3,649

 

 

 

 
3,649

Hedging Collateral Deposits
1,771

 

 

 

 
1,771

Total                                           
$
295,206

 
$
73,573

 
$

 
$
(11,293
)
 
$
357,486

 
 
 
 
 
 
 
 
 
 
Liabilities:
 

 
 

 
 

 
 

 
 

Derivative Financial Instruments:
 

 
 

 
 

 
 

 
 

Commodity Futures Contracts – Gas
$
1,068

 
$

 
$

 
$
(1,068
)
 
$

Over the Counter Swaps – Gas and Oil

 
9,641

 

 
(10,177
)
 
(536
)
Foreign Currency Contracts

 
2,055

 

 
(48
)
 
2,007

Total
$
1,068

 
$
11,696

 
$

 
$
(11,293
)
 
$
1,471

Total Net Assets/(Liabilities)
$
294,138

 
$
61,877

 
$

 
$

 
$
356,015

 
Recurring Fair Value Measures
At fair value as of September 30, 2016
(Thousands of Dollars)   
Level 1
 
Level 2
 
Level 3
 
Netting Adjustments(1)
 
Total(1)
Assets:
 

 
 

 
 

 
 

 
 

Cash Equivalents – Money Market Mutual Funds
$
114,895

 
$

 
$

 
$

 
$
114,895

Derivative Financial Instruments:
 

 
 

 
 

 
 

 
 

Commodity Futures Contracts – Gas
2,623

 

 

 
(2,276
)
 
347

Over the Counter Swaps – Gas and Oil

 
119,654

 

 
(3,860
)
 
115,794

Foreign Currency Contracts

 

 

 
(2,337
)
 
(2,337
)
Other Investments:
 

 
 

 
 

 
 

 
 

Balanced Equity Mutual Fund
36,658

 

 

 

 
36,658

Fixed Income Mutual Fund
31,395

 

 

 

 
31,395

Common Stock – Financial Services Industry
2,902

 

 

 

 
2,902

Hedging Collateral Deposits
1,484

 

 

 

 
1,484

Total                                           
$
189,957

 
$
119,654

 
$

 
$
(8,473
)
 
$
301,138

 
 
 
 
 
 
 
 
 
 
Liabilities:
 

 
 

 
 

 
 

 
 

Derivative Financial Instruments:
 

 
 

 
 

 
 

 
 

Commodity Futures Contracts – Gas
$
2,276

 
$

 
$

 
$
(2,276
)
 
$

Over the Counter Swaps – Gas and Oil

 
5,322

 

 
(3,860
)
 
1,462

     Foreign Currency Contracts

 
2,337

 

 
(2,337
)
 

Total
$
2,276

 
$
7,659

 
$

 
$
(8,473
)
 
$
1,462

Total Net Assets/(Liabilities)
$
187,681

 
$
111,995

 
$

 
$

 
$
299,676


(1) 
Netting Adjustments represent the impact of legally-enforceable master netting arrangements that allow the Company to net gain and loss positions held with the same counterparties. The net asset or net liability for each counterparty is recorded as an asset or liability on the Company’s balance sheet.
The table listed below provides a reconciliation of the beginning and ending net balances for assets and liabilities measured at fair value and classified as Level 3 for the six months ended March 31, 2016. For the six months ended March 31, 2017, there were no assets or liabilities measured at fair value and classified as Level 3. The Company's Exploration and Production segment had a small portion of their crude oil price swap agreements reported as Level 3 at October 1, 2015 that settled during the first quarter of fiscal 2016. For the quarters and six months ended March 31, 2017 and March 31, 2016, no transfers in or out of Level 1 or Level 2 occurred. There were no purchases or sales of derivative financial instruments during the period presented in the table below.  All settlements of the derivative financial instruments are reflected in the Gains/Losses Realized and Included in Earnings column of the table below (amounts in parentheses indicate credits in the derivative asset/liability accounts).  
 
 
 
 
 
 
 
Fair Value Measurements Using Unobservable Inputs (Level 3)
(Thousands of Dollars)   
 
Total Gains/Losses 
 
 
 
October 1, 2015
Gains/Losses Realized and Included in Earnings
Gains/Losses Unrealized and Included in Other Comprehensive Income (Loss)
Transfer In/Out of Level 3
March 31, 2016
Derivative Financial Instruments(2)
$
1,791

$
(2,002
)
(1) 
$
211

$

$

 
 
 
 
 
 
 

(1) 
Amounts are reported in Operating Revenues in the Consolidated Statement of Income for the three months ended March 31, 2016
(2) 
Derivative Financial Instruments are shown on a net basis.
Financial Instruments (Tables)
Based on these criteria, the fair market value of long-term debt, including current portion, was as follows (in thousands): 
 
March 31, 2017
 
September 30, 2016
 
Carrying Amount
 
Fair Value
 
Carrying Amount
 
Fair Value
Long-Term Debt
$
2,087,385

 
$
2,221,216

 
$
2,086,252

 
$
2,255,562

The Effect of Derivative Financial Instruments on the Statement of Financial Performance for the
Three Months Ended March 31, 2017 and 2016 (Thousands of Dollars)
Derivatives in Cash Flow Hedging Relationships
Amount of Derivative Gain or (Loss) Recognized in Other Comprehensive Income (Loss) on the Consolidated Statement of Comprehensive Income (Loss) (Effective Portion) for the Three Months Ended March 31,
Location of Derivative Gain or (Loss) Reclassified from Accumulated Other Comprehensive Income (Loss) on the Consolidated Balance Sheet into the Consolidated Statement of Income (Effective Portion)
Amount of Derivative Gain or (Loss) Reclassified from Accumulated Other Comprehensive Income (Loss) on the Consolidated Balance Sheet into the Consolidated Statement of Income (Effective Portion) for the Three Months Ended March 31,
Location of Derivative Gain or (Loss) Recognized in the Consolidated Statement of Income (Ineffective Portion and Amount Excluded from Effectiveness Testing)
Derivative Gain or (Loss) Recognized in the Consolidated Statement of Income (Ineffective Portion and Amount Excluded from Effectiveness Testing) for the Three Months Ended March 31,
 
2017
2016
 
2017
2016
 
2017
2016
Commodity Contracts
$
42,484

$
30,876

Operating Revenue
$
12,109

$
57,914

Operating Revenue
$

$
31

Commodity Contracts
1,044

(214
)
Purchased Gas
(1,498
)
3,530

Not Applicable


Foreign Currency Contracts
569

3,106

Operation and Maintenance Expense
(139
)
(209
)
Not Applicable


Total
$
44,097

$
33,768

 
$
10,472

$
61,235

 
$

$
31

The Effect of Derivative Financial Instruments on the Statement of Financial Performance for the
Six Months Ended March 31, 2017 and 2016 (Thousands of Dollars)
Derivatives in Cash Flow Hedging Relationships
Amount of Derivative Gain or (Loss) Recognized in Other Comprehensive Income (Loss) on the Consolidated Statement of Comprehensive Income (Loss) (Effective Portion) for the Six Months Ended March 31,
Location of Derivative Gain or (Loss) Reclassified from Accumulated Other Comprehensive Income (Loss) on the Consolidated Balance Sheet into the Consolidated Statement of Income (Effective Portion)
Amount of Derivative Gain or (Loss) Reclassified from Accumulated Other Comprehensive Income (Loss) on the Consolidated Balance Sheet into the Consolidated Statement of Income (Effective Portion) for the Six Months Ended March 31,
Location of Derivative Gain or (Loss) Recognized in the Consolidated Statement of Income (Ineffective Portion and Amount Excluded from Effectiveness Testing)
Derivative Gain or (Loss) Recognized in the Consolidated Statement of Income (Ineffective Portion and Amount Excluded from Effectiveness Testing) for the Six Months Ended March 31,
 
2017
2016
 
2017
2016
 
2017
2016
Commodity Contracts
$
(7,960
)
$
96,217

Operating Revenue
$
43,429

$
114,242

Operating Revenue
$
(100
)
$
168

Commodity Contracts
(492
)
1,999

Purchased Gas
(1,958
)
4,450

Not Applicable


Foreign Currency Contracts
48

923

Operation and Maintenance Expense
(282
)
(287
)
Not Applicable


Total
$
(8,404
)
$
99,139

 
$
41,189

$
118,405

 
$
(100
)
$
168

 
 
 
 
 
 
 
 
 

For derivative instruments that are designated and qualify as a fair value hedge, the gain or loss on the derivative as well as the offsetting gain or loss on the hedged item attributable to the hedged risk completely offset each other in current earnings, as shown below.

Derivatives in Fair Value Hedging Relationships
Location of Gain or (Loss) on Derivative and Hedged Item Recognized in the Consolidated Statement of Income
Amount of Gain or (Loss) on Derivative Recognized in the Consolidated Statement of Income for the
Six Months Ended March 31, 2017
(In Thousands)
Amount of Gain or (Loss) on the Hedged Item Recognized in the Consolidated Statement of Income for the
Six Months Ended March 31, 2017
(In Thousands)
Commodity Contracts
Operating Revenues
$
2,954

$
(2,954
)
Commodity Contracts
Purchased Gas
$
226

$
(226
)
 
 
$
3,180

$
(3,180
)
 
Income Taxes (Tables)
The components of federal and state income taxes included in the Consolidated Statements of Income are as follows (in thousands): 
                                                         
Six Months Ended 
 March 31,
                                                         
2017
 
2016
Current Income Taxes 
 

 
 

Federal                                              
$
34,113

 
$
7,995

State                                                  
11,509

 
15,537

 
 
 
 
Deferred Income Taxes                                
 

 
 

Federal                                               
51,749

 
(197,982
)
State                                                    
12,032

 
(85,930
)
 
109,403

 
(260,380
)
Deferred Investment Tax Credit                            
(86
)
 
(174
)
 
 
 
 
Total Income Taxes                                      
$
109,317

 
$
(260,554
)
Presented as Follows:
 

 
 

Other Income
(86
)
 
(174
)
Income Tax Expense (Benefit)
109,403

 
(260,380
)
 
 
 
 
Total Income Taxes
$
109,317

 
$
(260,554
)
Total income taxes as reported differ from the amounts that were computed by applying the federal income tax rate to income (loss) before income taxes.  The following is a reconciliation of this difference (in thousands): 
 
Six Months Ended 
 March 31,
 
2017
 
2016
U.S. Income (Loss) Before Income Taxes
$
287,508

 
$
(597,350
)
 
 

 
 

Income Tax Expense (Benefit), Computed at U.S. Federal Statutory Rate of 35%
$
100,628

 
$
(209,073
)
State Income Taxes (Benefit)
15,302

 
(45,756
)
Miscellaneous
(6,613
)
 
(5,725
)
 
 
 
 
Total Income Taxes
$
109,317

 
$
(260,554
)
Business Segment Information (Tables)
Financial Segment Information By Segment
Quarter Ended March 31, 2017 (Thousands)
 
 
 
 
 
 
 
Exploration and Production
Pipeline and Storage
Gathering
Utility
Energy Marketing
Total Reportable Segments
All Other
Corporate and Intersegment Eliminations
Total Consolidated
Revenue from External Customers
$159,553
$53,163
$26
$257,949
$50,940
$521,631
$218
$226
$522,075
Intersegment Revenues
$—
$22,592
$27,936
$6,096
$16
$56,640
$—
$(56,640)
$—
Segment Profit: Net Income (Loss)
$33,769
$19,256
$10,285
$25,581
$905
$89,796
$(221)
$(291)
$89,284

 


 





Six Months Ended March 31, 2017 (Thousands)
 
 
 
 
 
 
 
Exploration and Production
Pipeline and Storage
Gathering
Utility
Energy Marketing
Total Reportable Segments
All Other
Corporate and Intersegment Eliminations
Total Consolidated
Revenue from External Customers
$320,485
$106,164
$52
$428,919
$87,750
$943,370
$772
$434
$944,576
Intersegment Revenues
$—
$44,746
$55,776
$7,922
$35
$108,479
$—
$(108,479)
$—
Segment Profit: Net Income (Loss)
$68,849
$38,624
$21,266
$46,755
$2,687
$178,181
$(400)
$410
$178,191
 
 
 
 
 
 
 
 
 
 
(Thousands)
Exploration and Production
Pipeline and Storage
Gathering
Utility
Energy Marketing
Total Reportable Segments
All Other
Corporate and Intersegment Eliminations
Total Consolidated
Segment Assets:
 
 
 
 
 
 
 
 
 
At March 31, 2017
$1,292,230
$1,718,862
$553,719
$2,108,549
$74,404
$5,747,764
$76,630
$(19,719)
$5,804,675
At September 30, 2016
$1,323,081
$1,680,734
$534,259
$2,021,514
$63,392
$5,622,980
$77,138
$(63,731)
$5,636,387

Quarter Ended March 31, 2016 (Thousands)
 
 
 
 
 
 
 
Exploration and Production
Pipeline and Storage
Gathering
Utility
Energy Marketing
Total Reportable Segments
All Other
Corporate and Intersegment Eliminations
Total Consolidated
Revenue from External Customers
$143,783
$56,276
$113
$212,737
$35,436
$448,345
$561
$226
$449,132
Intersegment Revenues
$—
$23,292
$21,545
$5,364
$312
$50,513
$—
$(50,513)
$—
Segment Profit: Net Income (Loss)
$(213,335)
$21,194
$7,568
$31,960
$3,484
$(149,129)
$(23)
$1,465
$(147,687)
Six Months Ended March 31, 2016 (Thousands)
 
 
 
 
 
 
 
Exploration and Production
Pipeline and Storage
Gathering
Utility
Energy Marketing
Total Reportable Segments
All Other
Corporate and Intersegment Eliminations
Total Consolidated
Revenue from External Customers
$295,749
$109,630
$238
$356,585
$60,420
$822,622
$1,266
$439
$824,327
Intersegment Revenues
$—
$45,477
$40,184
$9,028
$624
$95,313
$—
$(95,313)
$—
Segment Profit: Net Income (Loss)
$(450,421)
$42,470
$12,490
$50,566
$4,707
$(340,188)
$166
$3,226
$(336,796)
 
 
 
 
 
 
 
 
 
 
Retirement Plan And Other Post-Retirement Benefits (Tables)
Components of Net Periodic Benefit Cost
Components of Net Periodic Benefit Cost (in thousands):
 
 
Retirement Plan
 
Other Post-Retirement Benefits
Three Months Ended March 31,
2017
2016
 
2017
2016





 




Service Cost
$
2,992

$
2,928

 
$
612

$
583

Interest Cost
9,596

10,579

 
4,752

5,096

Expected Return on Plan Assets
(14,929
)
(14,842
)
 
(7,865
)
(7,883
)
Amortization of Prior Service Cost (Credit)
264

308

 
(107
)
(228
)
Amortization of Losses
10,672

8,062

 
4,604

1,382

Net Amortization and Deferral for Regulatory Purposes (Including Volumetric Adjustments) (1)
6,234

5,609

 
3,790

6,599






 




Net Periodic Benefit Cost
$
14,829

$
12,644

 
$
5,786

$
5,549

 
 
 
 
 
 
 
Retirement Plan
 
Other Post-Retirement Benefits
Six Months Ended March 31,
2017
2016
 
2017
2016
 
 
 
 
 
 
Service Cost
$
5,984

$
5,855

 
$
1,224

$
1,166

Interest Cost
19,192

21,158

 
9,504

10,193

Expected Return on Plan Assets
(29,859
)
(29,685
)
 
(15,729
)
(15,768
)
Amortization of Prior Service Cost (Credit)
529

617

 
(214
)
(456
)
Amortization of Losses
21,343

16,124

 
9,207

2,765

Net Amortization and Deferral for Regulatory Purposes (Including Volumetric Adjustments) (1)
6,770

7,516

 
5,102

10,720

 
 
 
 
 
 
Net Periodic Benefit Cost
$
23,959

$
21,585

 
$
9,094

$
8,620

 
 
 
 
 
 
(1) 
The Company’s policy is to record retirement plan and other post-retirement benefit costs in the Utility segment on a volumetric basis to reflect the fact that the Utility segment experiences higher throughput of natural gas in the winter months and lower throughput of natural gas in the summer months.
Summary Of Significant Accounting Policies (Narrative) (Details) (USD $)
3 Months Ended 6 Months Ended 12 Months Ended 6 Months Ended 12 Months Ended 6 Months Ended
Mar. 31, 2017
Mar. 31, 2016
Mar. 31, 2017
Mar. 31, 2016
Sep. 30, 2016
Mar. 31, 2017
Seneca [Member]
Sep. 30, 2016
Seneca [Member]
Dec. 1, 2015
IOG-CRV Marcellus, LLC [Member]
Mar. 31, 2017
Reserve For Gas Replacement [Member]
Sep. 30, 2016
Reserve For Gas Replacement [Member]
Mar. 31, 2017
Non-performance Based Restricted Stock Units [Member]
Mar. 31, 2017
Performance Shares [Member]
Sep. 30, 2017
Subsequent Event [Member]
Reserve For Gas Replacement [Member]
Dec. 1, 2015
Initial Participation [Member]
IOG-CRV Marcellus, LLC [Member]
Jun. 13, 2016
26 Percent Net Revenue Interest [Member]
Seneca [Member]
Dec. 1, 2015
After Internal Rate of Return Achieved [Member]
Seneca [Member]
Jun. 13, 2016
Extended Agreement [Member]
Seneca [Member]
Mar. 31, 2017
Extended Agreement [Member]
IOG-CRV Marcellus, LLC [Member]
Jun. 13, 2016
Extended Agreement [Member]
IOG-CRV Marcellus, LLC [Member]
Jun. 13, 2016
20 Percent Net Revenue Interest [Member]
Seneca [Member]
Summary Of Significant Accounting Policies [Line Items]
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Cumulative Effect of Adoption of Authoritative Guidance for Stock-Based Compensation
$ 31,900,000 
 
$ 31,900,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Gas stored underground
(9,027,000)
 
(9,027,000)
 
(34,332,000)
 
 
 
20,215,000 
 
 
 
 
 
 
 
 
 
Capitalized costs of unproved properties excluded from amortization
 
 
114,300,000 
 
135,300,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Full cost ceiling test discount factor
10.00% 
 
10.00% 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Amount Full Cost Ceiling Exceeds Book Value Of Oil And Gas Properties
201,000,000 
 
201,000,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Impairment of Oil and Gas Producing Properties
397,443,000 
832,894,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Increase estimated future net cash flows
105,400,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Wells to be Developed
 
 
 
 
 
 
 
 
 
 
 
 
 
42 
56 
 
 
 
75 
19 
Partner Amount Funded to Develop Joint Wells
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
251,400,000 
 
 
Cumulative Net Proceeds from Sale of Oil and Gas Producing Properties
 
 
 
 
 
163,900,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Partner Working and Net Revenue Interest
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
20.00% 
 
 
 
Royalty Interest
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
7.50% 
 
 
 
Partner Commitment to Develop Joint Wells
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
325,000,000 
 
Net Proceeds from Sale of Oil and Gas Producing Properties
 
 
26,554,000 
104,938,000 
 
26,600,000 
137,300,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
Partner Working Interest In Joint Wells
 
 
 
 
 
 
 
80.00% 
 
 
 
 
 
 
 
85.00% 
20.00% 
 
 
 
Partner Net Revenue Interest in Joint Wells
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
26.00% 
 
 
 
Antidilutive securities
157,554 
386,626 
158,211 
451,291 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Share based compensation other than options grants in period
 
 
 
 
 
 
 
 
 
 
87,143 
184,148 
 
 
 
 
 
 
 
 
Granted in fiscal year, weighted average grant date fair value
 
 
 
 
 
 
 
 
 
 
$ 52.13 
$ 56.39 
 
 
 
 
 
 
 
 
Reduction in Property, Plant and Equipment
 
 
 
 
 
$ 163,900,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Internal Rate of Return
 
 
 
 
 
 
 
15.00% 
 
 
 
 
 
 
 
 
 
 
 
 
Summary Of Significant Accounting Policies (Components Of Accumulated Other Comprehensive Income (Loss)) (Details) (USD $)
In Thousands, unless otherwise specified
3 Months Ended 6 Months Ended
Mar. 31, 2017
Mar. 31, 2016
Mar. 31, 2017
Mar. 31, 2016
Accumulated Other Comprehensive Income [Roll Forward]
 
 
 
 
Balance at Beginning of Period
$ (54,859)
$ 98,456 
$ (5,640)
$ 93,372 
Other Comprehensive Gains and Losses Before Reclassification
26,826 
19,590 
(4,162)
63,838 
Amounts Reclassified From Other Comprehensive Income (Loss)
(6,058)
(35,860)
(24,289)
(75,024)
Balance at End of Period
(34,091)
82,186 
(34,091)
82,186 
Gains And Losses On Derivative Financial Instruments [Member]
 
 
 
 
Accumulated Other Comprehensive Income [Roll Forward]
 
 
 
 
Balance at Beginning of Period
16,570 
162,728 
64,782 
157,197 
Other Comprehensive Gains and Losses Before Reclassification
25,745 
19,578 
(4,705)
64,273 
Amounts Reclassified From Other Comprehensive Income (Loss)
(6,058)
(35,635)
(23,820)
(74,799)
Balance at End of Period
36,257 
146,671 
36,257 
146,671 
Gains And Losses On Securities Available For Sale [Member]
 
 
 
 
Accumulated Other Comprehensive Income [Roll Forward]
 
 
 
 
Balance at Beginning of Period
5,047 
5,522 
6,054 
5,969 
Other Comprehensive Gains and Losses Before Reclassification
1,081 
12 
543 
(435)
Amounts Reclassified From Other Comprehensive Income (Loss)
(225)
(469)
(225)
Balance at End of Period
6,128 
5,309 
6,128 
5,309 
Funded Status Of The Pension And Other Post-Retirement Benefit Plans [Member]
 
 
 
 
Accumulated Other Comprehensive Income [Roll Forward]
 
 
 
 
Balance at Beginning of Period
(76,476)
(69,794)
(76,476)
(69,794)
Other Comprehensive Gains and Losses Before Reclassification
Amounts Reclassified From Other Comprehensive Income (Loss)
Balance at End of Period
$ (76,476)
$ (69,794)
$ (76,476)
$ (69,794)
Summary Of Significant Accounting Policies (Reclassification Out Of Accumulated Other Comprehensive Income (Loss)) (Details) (USD $)
In Thousands, unless otherwise specified
3 Months Ended 6 Months Ended
Mar. 31, 2017
Mar. 31, 2016
Mar. 31, 2017
Mar. 31, 2016
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items]
 
 
 
 
Operating Revenues
$ 522,075 
$ 449,132 
$ 944,576 
$ 824,327 
Purchased Gas
147,971 
81,623 
218,214 
123,691 
Other Income
1,744 
3,236 
3,356 
5,654 
Income Before Income Taxes
142,255 
(263,717)
287,594 
(597,176)
Income Tax Expense
(52,971)
116,030 
(109,403)
260,380 
Net Income (Loss) Available for Common Stock
89,284 
(147,687)
178,191 
(336,796)
Amount Of Gain Or (Loss) Reclassified From Accumulated Other Comprehensive Income (Loss) [Member]
 
 
 
 
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items]
 
 
 
 
Income Before Income Taxes
10,472 
61,623 
41,930 
118,793 
Income Tax Expense
(4,414)
(25,763)
(17,641)
(43,769)
Net Income (Loss) Available for Common Stock
6,058 
35,860 
24,289 
75,024 
Amount Of Gain Or (Loss) Reclassified From Accumulated Other Comprehensive Income (Loss) [Member] |
Gains And Losses On Securities Available For Sale [Member]
 
 
 
 
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items]
 
 
 
 
Other Income
388 
741 
388 
Amount Of Gain Or (Loss) Reclassified From Accumulated Other Comprehensive Income (Loss) [Member] |
Commodity Contracts [Member] |
Gains And Losses On Derivative Financial Instruments [Member]
 
 
 
 
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items]
 
 
 
 
Operating Revenues
12,109 
57,914 
43,429 
114,242 
Purchased Gas
(1,498)
3,530 
(1,958)
4,450 
Foreign Currency Contracts [Member] |
Amount Of Gain Or (Loss) Reclassified From Accumulated Other Comprehensive Income (Loss) [Member] |
Gains And Losses On Derivative Financial Instruments [Member]
 
 
 
 
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items]
 
 
 
 
Operation and Maintenance
$ (139)
$ (209)
$ (282)
$ (287)
Summary Of Significant Accounting Policies (Components Of Other Current Assets) (Details) (USD $)
In Thousands, unless otherwise specified
Mar. 31, 2017
Sep. 30, 2016
Summary Of Significant Accounting Policies [Line Items]
 
 
Prepayments
$ 5,284 
$ 10,919 
Prepaid Property and Other Taxes
22,563 
13,138 
Fair Values of Firm Commitments
3,962 
Regulatory Assets
18,501 
15,616 
Other Current Assets
51,585 
59,354 
Federal [Member]
 
 
Summary Of Significant Accounting Policies [Line Items]
 
 
Income Taxes Receivable
11,758 
State [Member]
 
 
Summary Of Significant Accounting Policies [Line Items]
 
 
Income Taxes Receivable
$ 5,237 
$ 3,961 
Summary Of Significant Accounting Policies (Schedule Of Other Accruals And Current Liabilities) (Details) (USD $)
In Thousands, unless otherwise specified
Mar. 31, 2017
Sep. 30, 2016
Summary Of Significant Accounting Policies [Line Items]
 
 
Regulatory Liabilities
$ 29,579 
$ 14,725 
Reserve for Gas Replacement
(9,027)
(34,332)
Other
33,174 
32,909 
Other Accruals and Current Liabilities
106,287 
74,430 
Accrued Capital Expenditures [Member]
 
 
Summary Of Significant Accounting Policies [Line Items]
 
 
Other
13,964 
26,796 
Reserve For Gas Replacement [Member]
 
 
Summary Of Significant Accounting Policies [Line Items]
 
 
Reserve for Gas Replacement
20,215 
Federal [Member]
 
 
Summary Of Significant Accounting Policies [Line Items]
 
 
Income Taxes Payable
$ 9,355 
$ 0 
Fair Value Measurements (Narrative) (Details) (USD $)
In Thousands, unless otherwise specified
Mar. 31, 2017
Sep. 30, 2016
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
Hedging collateral deposits
$ 1,771 1
$ 1,484 1
Fair Value, Inputs, Level 3 [Member]
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
Hedging collateral deposits
Fair Value, Inputs, Level 1 [Member]
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
Hedging collateral deposits
1,771 
1,484 
Fair Value, Inputs, Level 1 [Member] |
Futures [Member]
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
Hedging collateral deposits
$ 1,800 
$ 1,500 
Fair Value Measurements (Recurring Fair Value Measures Of Assets And Liabilities) (Details) (USD $)
In Thousands, unless otherwise specified
Mar. 31, 2017
Sep. 30, 2016
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items]
 
 
Cash Equivalents - Money Market Mutual Funds
$ 214,213 1
$ 114,895 1
Hedging Collateral Deposits
1,771 1
1,484 1
Total Assets
357,486 1
301,138 1
Total Liabilities
1,471 1
1,462 1
Total Net Assets/(Liabilities)
356,015 1
299,676 1
Commodity Futures Contracts - Gas [Member]
 
 
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items]
 
 
Derivative Asset
1,381 1
347 1
Derivative Liability
1
1
Over The Counter Swaps - Gas And Oil [Member]
 
 
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items]
 
 
Derivative Asset
63,348 1
115,794 1
Derivative Liability
(536)1
1,462 1
Foreign Currency Contracts [Member]
 
 
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items]
 
 
Derivative Asset
1
(2,337)1
Derivative Liability
2,007 1
1
Balanced Equity Mutual Fund [Member]
 
 
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items]
 
 
Other Investments
34,664 1
36,658 1
Fixed Income Mutual Fund [Member]
 
 
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items]
 
 
Other Investments
38,460 1
31,395 1
Common Stock - Financial Services Industry [Member]
 
 
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items]
 
 
Other Investments
3,649 1
2,902 1
Fair Value, Inputs, Level 1 [Member]
 
 
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items]
 
 
Cash Equivalents - Money Market Mutual Funds
214,213 
114,895 
Hedging Collateral Deposits
1,771 
1,484 
Total Assets
295,206 
189,957 
Total Liabilities
1,068 
2,276 
Total Net Assets/(Liabilities)
294,138 
187,681 
Fair Value, Inputs, Level 1 [Member] |
Commodity Futures Contracts - Gas [Member]
 
 
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items]
 
 
Derivative Asset
2,449 
2,623 
Derivative Liability
1,068 
2,276 
Fair Value, Inputs, Level 1 [Member] |
Over The Counter Swaps - Gas And Oil [Member]
 
 
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items]
 
 
Derivative Asset
Derivative Liability
Fair Value, Inputs, Level 1 [Member] |
Foreign Currency Contracts [Member]
 
 
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items]
 
 
Derivative Asset
Derivative Liability
Fair Value, Inputs, Level 1 [Member] |
Balanced Equity Mutual Fund [Member]
 
 
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items]
 
 
Other Investments
34,664 
36,658 
Fair Value, Inputs, Level 1 [Member] |
Fixed Income Mutual Fund [Member]
 
 
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items]
 
 
Other Investments
38,460 
31,395 
Fair Value, Inputs, Level 1 [Member] |
Common Stock - Financial Services Industry [Member]
 
 
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items]
 
 
Other Investments
3,649 
2,902 
Fair Value, Inputs, Level 2 [Member]
 
 
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items]
 
 
Cash Equivalents - Money Market Mutual Funds
Hedging Collateral Deposits
Total Assets
73,573 
119,654 
Total Liabilities
11,696 
7,659 
Total Net Assets/(Liabilities)
61,877 
111,995 
Fair Value, Inputs, Level 2 [Member] |
Commodity Futures Contracts - Gas [Member]
 
 
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items]
 
 
Derivative Asset
Derivative Liability
Fair Value, Inputs, Level 2 [Member] |
Over The Counter Swaps - Gas And Oil [Member]
 
 
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items]
 
 
Derivative Asset
73,525 
119,654 
Derivative Liability
9,641 
5,322 
Fair Value, Inputs, Level 2 [Member] |
Foreign Currency Contracts [Member]
 
 
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items]
 
 
Derivative Asset
48 
Derivative Liability
2,055 
2,337 
Fair Value, Inputs, Level 2 [Member] |
Balanced Equity Mutual Fund [Member]
 
 
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items]
 
 
Other Investments
Fair Value, Inputs, Level 2 [Member] |
Fixed Income Mutual Fund [Member]
 
 
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items]
 
 
Other Investments
Fair Value, Inputs, Level 2 [Member] |
Common Stock - Financial Services Industry [Member]
 
 
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items]
 
 
Other Investments
Fair Value, Inputs, Level 3 [Member]
 
 
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items]
 
 
Cash Equivalents - Money Market Mutual Funds
Hedging Collateral Deposits
Total Assets
Total Liabilities
Total Net Assets/(Liabilities)
Fair Value, Inputs, Level 3 [Member] |
Commodity Futures Contracts - Gas [Member]
 
 
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items]
 
 
Derivative Asset
Derivative Liability
Fair Value, Inputs, Level 3 [Member] |
Over The Counter Swaps - Gas And Oil [Member]
 
 
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items]
 
 
Derivative Asset
Derivative Liability
Fair Value, Inputs, Level 3 [Member] |
Foreign Currency Contracts [Member]
 
 
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items]
 
 
Derivative Asset
Derivative Liability
Fair Value, Inputs, Level 3 [Member] |
Balanced Equity Mutual Fund [Member]
 
 
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items]
 
 
Other Investments
Fair Value, Inputs, Level 3 [Member] |
Fixed Income Mutual Fund [Member]
 
 
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items]
 
 
Other Investments
Fair Value, Inputs, Level 3 [Member] |
Common Stock - Financial Services Industry [Member]
 
 
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items]
 
 
Other Investments
Netting Adjustments [Member]
 
 
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items]
 
 
Cash Equivalents - Money Market Mutual Funds
1
1
Hedging Collateral Deposits
1
1
Total Assets
(11,293)1
(8,473)1
Total Liabilities
(11,293)1
(8,473)1
Total Net Assets/(Liabilities)
1
1
Netting Adjustments [Member] |
Commodity Futures Contracts - Gas [Member]
 
 
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items]
 
 
Derivative Asset
(1,068)1
(2,276)1
Derivative Liability
(1,068)1
(2,276)1
Netting Adjustments [Member] |
Over The Counter Swaps - Gas And Oil [Member]
 
 
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items]
 
 
Derivative Asset
(10,177)1
(3,860)1
Derivative Liability
(10,177)1
(3,860)1
Netting Adjustments [Member] |
Foreign Currency Contracts [Member]
 
 
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items]
 
 
Derivative Asset
(48)1
(2,337)1
Derivative Liability
(48)1
(2,337)1
Netting Adjustments [Member] |
Balanced Equity Mutual Fund [Member]
 
 
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items]
 
 
Other Investments
1
1
Netting Adjustments [Member] |
Fixed Income Mutual Fund [Member]
 
 
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items]
 
 
Other Investments
1
1
Netting Adjustments [Member] |
Common Stock - Financial Services Industry [Member]
 
 
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items]
 
 
Other Investments
$ 0 1
$ 0 1
Fair Value Measurements (Fair Value Measurements Using Unobservable Inputs (Level 3)) (Details) (Derivative Financial Instruments [Member], USD $)
In Thousands, unless otherwise specified
6 Months Ended
Mar. 31, 2016
Derivative Financial Instruments [Member]
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Roll Forward]
 
Beginning Balance
$ 1,791 1
Total Gains/Losses, Realized and Included in Earnings
(2,002)1 2
Total Gains/Losses Unrealized and Included in Other Comprehensive Income (Loss)
211 1
Transfer In/Out of Level 3
1
Ending Balance
$ 0 1
Financial Instruments (Narrative) (Details) (USD $)
6 Months Ended
Mar. 31, 2017
Sep. 30, 2016
Derivative Instruments, Gain (Loss) [Line Items]
 
 
Cash surrender value of life insurance
$ 40,500,000 
$ 39,700,000 
Net hedging gains/losses in accumulated other comprehensive income (loss)
62,200,000 
 
After tax net hedging gains (losses) in accumulated other comprehensive income (loss)
36,300,000 
 
Pre-Tax Net Hedging Gains (Losses) Reclassified Within Twelve Months
35,900,000 
 
After Tax Net Hedging Gains (Losses) Reclassified Within Twelve Months
21,000,000 
 
Fair market value of derivative asset with a credit-risk related contingency
41,000,000 
 
Fair market value of derivative liability with a credit-risk related contingency
600,000 
 
Hedging collateral deposits
1,771,000 1
1,484,000 1
Over the Counter Swaps and Foreign Currency Forward Contracts [Member]
 
 
Derivative Instruments, Gain (Loss) [Line Items]
 
 
Number of counterparties in which the company holds over-the-counter swap positions
16 
 
Number of counterparties in net gain position
13 
 
Credit risk exposure per counterparty
4,800,000 
 
Maximum credit risk exposure per counterparty
10,000,000 
 
Collateral Received by the Company
 
Hedging collateral deposits
 
Fixed Price Purchase Commitments MMCf [Member] |
Energy Marketing [Member]
 
 
Derivative Instruments, Gain (Loss) [Line Items]
 
 
Nonmonetary notional amount of price risk fair value hedge derivatives, natural gas
100 
 
Withdrawal of Storage Gas Mmcf [Member] |
Energy Marketing [Member]
 
 
Derivative Instruments, Gain (Loss) [Line Items]
 
 
Nonmonetary notional amount of price risk fair value hedge derivatives, natural gas
600 
 
Fair Value Hedges MMCf [Member] |
Energy Marketing [Member]
 
 
Derivative Instruments, Gain (Loss) [Line Items]
 
 
Nonmonetary notional amount of price risk fair value hedge derivatives, natural gas
15,800 
 
Fixed Price Sales Commitments MMCf [Member] |
Energy Marketing [Member]
 
 
Derivative Instruments, Gain (Loss) [Line Items]
 
 
Nonmonetary notional amount of price risk fair value hedge derivatives, natural gas
15,100 
 
Natural Gas MMCf [Member] |
Cash Flow Hedges Short Position [Member]
 
 
Derivative Instruments, Gain (Loss) [Line Items]
 
 
Nonmonetary notional amount of price risk cash flow hedge derivatives, natural gas
138,800 
 
Natural Gas MMCf [Member] |
Cash Flow Hedges Long Position [Member]
 
 
Derivative Instruments, Gain (Loss) [Line Items]
 
 
Nonmonetary notional amount of price risk cash flow hedge derivatives, natural gas
1,600 
 
Crude Oil Bbls [Member] |
Cash Flow Hedges Short Position [Member]
 
 
Derivative Instruments, Gain (Loss) [Line Items]
 
 
Nonmonetary notional amount of price risk cash flow hedge derivatives, crude oil
3,051,000 
 
Exchange Traded Futures Contracts [Member]
 
 
Derivative Instruments, Gain (Loss) [Line Items]
 
 
Hedging collateral deposits
1,800,000 
 
Equity Mutual Fund [Member]
 
 
Derivative Instruments, Gain (Loss) [Line Items]
 
 
Fair value
34,700,000 
36,700,000 
Gross unrealized gain
7,400,000 
7,900,000 
Fixed Income Mutual Fund [Member]
 
 
Derivative Instruments, Gain (Loss) [Line Items]
 
 
Fair value
38,500,000 
31,400,000 
Gross unrealized gain
 
100,000 
Gross unrealized loss
100,000 
 
Insurance Company Stock [Member]
 
 
Derivative Instruments, Gain (Loss) [Line Items]
 
 
Fair value
3,600,000 
2,900,000 
Gross unrealized gain
2,400,000 
1,600,000 
Foreign Currency Contracts [Member]
 
 
Derivative Instruments, Gain (Loss) [Line Items]
 
 
Derivative, Notional Amount
$ 72,500,000 
 
Credit Risk Related Contingency Feature [Member] |
Over the Counter Swaps and Foreign Currency Forward Contracts [Member]
 
 
Derivative Instruments, Gain (Loss) [Line Items]
 
 
Number of counterparties with a common credit-risk related contingency
14 
 
Financial Instruments (Long-Term Debt) (Details) (USD $)
In Thousands, unless otherwise specified
Mar. 31, 2017
Sep. 30, 2016
Financial Instruments, Owned, at Fair Value [Abstract]
 
 
Carrying Amount
$ 2,087,385 
$ 2,086,252 
Fair Value
$ 2,221,216 
$ 2,255,562 
Financial Instruments (Schedule Of Derivative Financial Instruments Designated And Qualifying As Cash Flow Hedges On The Statement Of Financial Performance) (Details) (USD $)
In Thousands, unless otherwise specified
3 Months Ended 6 Months Ended
Mar. 31, 2017
Mar. 31, 2016
Mar. 31, 2017
Mar. 31, 2016
Derivative Instruments, Gain (Loss) [Line Items]
 
 
 
 
Amount of Derivative Gain or (Loss) Recognized in Other Comprehensive Income (Loss) on the Consolidated Statement of Comprehensive Income (Loss) (Effective Portion)
$ 44,097 
$ 33,768 
$ (8,404)
$ 99,139 
Amount of Derivative Gain or (Loss) Reclassified from Accumulated Other Comprehensive Income (Loss) on the Consolidated Balance Sheet into the Consolidated Statement of Income (Effective Portion)
10,472 
61,235 
41,189 
118,405 
Derivative Gain or (Loss) Recognized in the Consolidated Statement of Income (Ineffective Portion and Amount Excluded from Effectiveness Testing)
31 
(100)
168 
Foreign Currency Contracts [Member] |
Operation and Maintenance Expense [Member]
 
 
 
 
Derivative Instruments, Gain (Loss) [Line Items]
 
 
 
 
Amount of Derivative Gain or (Loss) Recognized in Other Comprehensive Income (Loss) on the Consolidated Statement of Comprehensive Income (Loss) (Effective Portion)
569 
3,106 
48 
923 
Amount of Derivative Gain or (Loss) Reclassified from Accumulated Other Comprehensive Income (Loss) on the Consolidated Balance Sheet into the Consolidated Statement of Income (Effective Portion)
(139)
(209)
(282)
(287)
Derivative Gain or (Loss) Recognized in the Consolidated Statement of Income (Ineffective Portion and Amount Excluded from Effectiveness Testing)
Commodity Contracts [Member] |
Operating Revenues [Member]
 
 
 
 
Derivative Instruments, Gain (Loss) [Line Items]
 
 
 
 
Amount of Derivative Gain or (Loss) Recognized in Other Comprehensive Income (Loss) on the Consolidated Statement of Comprehensive Income (Loss) (Effective Portion)
42,484 
30,876 
(7,960)
96,217 
Amount of Derivative Gain or (Loss) Reclassified from Accumulated Other Comprehensive Income (Loss) on the Consolidated Balance Sheet into the Consolidated Statement of Income (Effective Portion)
12,109 
57,914 
43,429 
114,242 
Derivative Gain or (Loss) Recognized in the Consolidated Statement of Income (Ineffective Portion and Amount Excluded from Effectiveness Testing)
31 
(100)
168 
Commodity Contracts [Member] |
Purchased Gas [Member]
 
 
 
 
Derivative Instruments, Gain (Loss) [Line Items]
 
 
 
 
Amount of Derivative Gain or (Loss) Recognized in Other Comprehensive Income (Loss) on the Consolidated Statement of Comprehensive Income (Loss) (Effective Portion)
1,044 
(214)
(492)
1,999 
Amount of Derivative Gain or (Loss) Reclassified from Accumulated Other Comprehensive Income (Loss) on the Consolidated Balance Sheet into the Consolidated Statement of Income (Effective Portion)
(1,498)
3,530 
(1,958)
4,450 
Derivative Gain or (Loss) Recognized in the Consolidated Statement of Income (Ineffective Portion and Amount Excluded from Effectiveness Testing)
$ 0 
$ 0 
$ 0 
$ 0 
Financial Instruments (Schedule Of Derivatives And Hedged Items In Fair Value Hedging Relationships) (Details) (USD $)
In Thousands, unless otherwise specified
6 Months Ended
Mar. 31, 2017
Derivative Instruments, Gain (Loss) [Line Items]
 
Amount of Gain or (Loss) on Derivative Recognized in the Consolidated Statement of Income
$ 3,180 
Amount of Gain or (Loss) on the Hedged Item Recognized in the Consolidated Statement of Income
(3,180)
Operating Revenues [Member]
 
Derivative Instruments, Gain (Loss) [Line Items]
 
Amount of Gain or (Loss) on Derivative Recognized in the Consolidated Statement of Income
2,954 
Amount of Gain or (Loss) on the Hedged Item Recognized in the Consolidated Statement of Income
(2,954)
Purchased Gas [Member]
 
Derivative Instruments, Gain (Loss) [Line Items]
 
Amount of Gain or (Loss) on Derivative Recognized in the Consolidated Statement of Income
226 
Amount of Gain or (Loss) on the Hedged Item Recognized in the Consolidated Statement of Income
$ (226)
Income Taxes Income Taxes (Narrative) (Details) (USD $)
In Millions, unless otherwise specified
Mar. 31, 2017
Significant Change in Unrecognized Tax Benefits is Reasonably Possible [Line Items]
 
Unrecognized Tax Benefits that Would Impact Effective Tax Rate
$ 1.3 
Income Taxes (Components Of Federal And State Income Taxes Included In The Consolidated Statements Of Income) (Details) (USD $)
In Thousands, unless otherwise specified
3 Months Ended 6 Months Ended
Mar. 31, 2017
Mar. 31, 2016
Mar. 31, 2017
Mar. 31, 2016
Current Income Taxes [Abstract]
 
 
 
 
Federal
 
 
$ 34,113 
$ 7,995 
State
 
 
11,509 
15,537 
Deferred Income Taxes [Abstract]
 
 
 
 
Federal
 
 
51,749 
(197,982)
State
 
 
12,032 
(85,930)
Income Tax Expense (Benefit)
52,971 
(116,030)
109,403 
(260,380)
Deferred Investment Tax Credit
 
 
(86)
(174)
Total Income Taxes
 
 
109,317 
(260,554)
Presented as Follows [Abstract]
 
 
 
 
Other Income
 
 
(86)
(174)
Income Tax Expense (Benefit)
$ 52,971 
$ (116,030)
$ 109,403 
$ (260,380)
Income Taxes (Schedule Of Income Tax Reconciliation By Applying Federal Income Tax Rate) (Details) (USD $)
In Thousands, unless otherwise specified
6 Months Ended
Mar. 31, 2017
Mar. 31, 2016
Income Tax Disclosure [Abstract]
 
 
U.S. Income (Loss) Before Income Taxes
$ 287,508 
$ (597,350)
Income Tax Expense (Benefit), Computed at U.S. Federal Statutory Rate of 35%
100,628 
(209,073)
State Income Taxes (Benefit)
15,302 
(45,756)
Miscellaneous
(6,613)
(5,725)
Total Income Taxes
$ 109,317 
$ (260,554)
Federal Statutory Rate
35.00% 
35.00% 
Capitalization (Details)
6 Months Ended
Mar. 31, 2017
Debt Instrument [Line Items]
 
Common stock shares issued due to stock option exercises
31,446 
Issue shares of common stock for the Direct Stock Purchase and Dividend Reinvestment Plan
90,361 
Issue shares of common stock for the 401(k) plans
51,727 
Shares tendered
45,740 
Restricted Stock Units [Member]
 
Debt Instrument [Line Items]
 
Common stock issued
74,547 
Performance Shares [Member]
 
Debt Instrument [Line Items]
 
Common stock issued
43,484 
Board Of Directors [Member]
 
Debt Instrument [Line Items]
 
Common stock issued
10,357 
Commitments And Contingencies (Details) (USD $)
In Millions, unless otherwise specified
6 Months Ended
Mar. 31, 2017
Site Contingency [Line Items]
 
Estimated minimum liability for environmental remediation
$ 3.4 
Rate recovery period
4 years 
Former Manufactured Gas Plant Site [Member]
 
Site Contingency [Line Items]
 
Estimated minimum liability for environmental remediation
$ 1.8 
Business Segment Information (Narrative) (Details)
6 Months Ended
Mar. 31, 2017
segment
Segment Reporting [Abstract]
 
Number of reportable segments
Business Segment Information (Financial Segment Information By Segment) (Details) (USD $)
In Thousands, unless otherwise specified
3 Months Ended 6 Months Ended
Mar. 31, 2017
Mar. 31, 2016
Mar. 31, 2017
Mar. 31, 2016
Sep. 30, 2016
Segment Reporting Information [Line Items]
 
 
 
 
 
Segment Profit: Net Income (Loss)
$ 89,284 
$ (147,687)
$ 178,191 
$ (336,796)
 
Segment Assets
5,804,675 
 
5,804,675 
 
5,636,387 
Revenue from External Customers [Member]
 
 
 
 
 
Segment Reporting Information [Line Items]
 
 
 
 
 
Revenue
522,075 
449,132 
944,576 
824,327 
 
Intersegment Revenues [Member]
 
 
 
 
 
Segment Reporting Information [Line Items]
 
 
 
 
 
Revenue
 
Exploration And Production [Member]
 
 
 
 
 
Segment Reporting Information [Line Items]
 
 
 
 
 
Segment Profit: Net Income (Loss)
33,769 
(213,335)
68,849 
(450,421)
 
Segment Assets
1,292,230 
 
1,292,230 
 
1,323,081 
Exploration And Production [Member] |
Revenue from External Customers [Member]
 
 
 
 
 
Segment Reporting Information [Line Items]
 
 
 
 
 
Revenue
159,553 
143,783 
320,485 
295,749 
 
Exploration And Production [Member] |
Intersegment Revenues [Member]
 
 
 
 
 
Segment Reporting Information [Line Items]
 
 
 
 
 
Revenue
 
Pipeline And Storage [Member]
 
 
 
 
 
Segment Reporting Information [Line Items]
 
 
 
 
 
Segment Profit: Net Income (Loss)
19,256 
21,194 
38,624 
42,470 
 
Segment Assets
1,718,862 
 
1,718,862 
 
1,680,734 
Pipeline And Storage [Member] |
Revenue from External Customers [Member]
 
 
 
 
 
Segment Reporting Information [Line Items]
 
 
 
 
 
Revenue
53,163 
56,276 
106,164 
109,630 
 
Pipeline And Storage [Member] |
Intersegment Revenues [Member]
 
 
 
 
 
Segment Reporting Information [Line Items]
 
 
 
 
 
Revenue
22,592 
23,292 
44,746 
45,477 
 
Gathering [Member]
 
 
 
 
 
Segment Reporting Information [Line Items]
 
 
 
 
 
Segment Profit: Net Income (Loss)
10,285 
7,568 
21,266 
12,490 
 
Segment Assets
553,719 
 
553,719 
 
534,259 
Gathering [Member] |
Revenue from External Customers [Member]
 
 
 
 
 
Segment Reporting Information [Line Items]
 
 
 
 
 
Revenue
26 
113 
52 
238 
 
Gathering [Member] |
Intersegment Revenues [Member]
 
 
 
 
 
Segment Reporting Information [Line Items]
 
 
 
 
 
Revenue
27,936 
21,545 
55,776 
40,184 
 
Utility [Member]
 
 
 
 
 
Segment Reporting Information [Line Items]
 
 
 
 
 
Segment Profit: Net Income (Loss)
25,581 
31,960 
46,755 
50,566 
 
Segment Assets
2,108,549 
 
2,108,549 
 
2,021,514 
Utility [Member] |
Revenue from External Customers [Member]
 
 
 
 
 
Segment Reporting Information [Line Items]
 
 
 
 
 
Revenue
257,949 
212,737 
428,919 
356,585 
 
Utility [Member] |
Intersegment Revenues [Member]
 
 
 
 
 
Segment Reporting Information [Line Items]
 
 
 
 
 
Revenue
6,096 
5,364 
7,922 
9,028 
 
Energy Marketing [Member]
 
 
 
 
 
Segment Reporting Information [Line Items]
 
 
 
 
 
Segment Profit: Net Income (Loss)
905 
3,484 
2,687 
4,707 
 
Segment Assets
74,404 
 
74,404 
 
63,392 
Energy Marketing [Member] |
Revenue from External Customers [Member]
 
 
 
 
 
Segment Reporting Information [Line Items]
 
 
 
 
 
Revenue
50,940 
35,436 
87,750 
60,420 
 
Energy Marketing [Member] |
Intersegment Revenues [Member]
 
 
 
 
 
Segment Reporting Information [Line Items]
 
 
 
 
 
Revenue
16 
312 
35 
624 
 
Total Reportable Segments [Member]
 
 
 
 
 
Segment Reporting Information [Line Items]
 
 
 
 
 
Segment Profit: Net Income (Loss)
89,796 
(149,129)
178,181 
(340,188)
 
Segment Assets
5,747,764 
 
5,747,764 
 
5,622,980 
Total Reportable Segments [Member] |
Revenue from External Customers [Member]
 
 
 
 
 
Segment Reporting Information [Line Items]
 
 
 
 
 
Revenue
521,631 
448,345 
943,370 
822,622 
 
Total Reportable Segments [Member] |
Intersegment Revenues [Member]
 
 
 
 
 
Segment Reporting Information [Line Items]
 
 
 
 
 
Revenue
56,640 
50,513 
108,479 
95,313 
 
All Other [Member]
 
 
 
 
 
Segment Reporting Information [Line Items]
 
 
 
 
 
Segment Profit: Net Income (Loss)
(221)
(23)
(400)
166 
 
Segment Assets
76,630 
 
76,630 
 
77,138 
All Other [Member] |
Revenue from External Customers [Member]
 
 
 
 
 
Segment Reporting Information [Line Items]
 
 
 
 
 
Revenue
218 
561 
772 
1,266 
 
All Other [Member] |
Intersegment Revenues [Member]
 
 
 
 
 
Segment Reporting Information [Line Items]
 
 
 
 
 
Revenue
 
Corporate And Intersegment Eliminations [Member]
 
 
 
 
 
Segment Reporting Information [Line Items]
 
 
 
 
 
Segment Profit: Net Income (Loss)
(291)
1,465 
410 
3,226 
 
Segment Assets
(19,719)
 
(19,719)
 
(63,731)
Corporate And Intersegment Eliminations [Member] |
Revenue from External Customers [Member]
 
 
 
 
 
Segment Reporting Information [Line Items]
 
 
 
 
 
Revenue
226 
226 
434 
439 
 
Corporate And Intersegment Eliminations [Member] |
Intersegment Revenues [Member]
 
 
 
 
 
Segment Reporting Information [Line Items]
 
 
 
 
 
Revenue
$ (56,640)
$ (50,513)
$ (108,479)
$ (95,313)
 
Retirement Plan And Other Post-Retirement Benefits (Narrative) (Details) (USD $)
In Millions, unless otherwise specified
6 Months Ended
Mar. 31, 2017
Retirement Plan [Member]
 
Defined Benefit Plan Disclosure [Line Items]
 
Company's contributions
$ 15.1 
VEBA Trusts And 401(h) Accounts [Member]
 
Defined Benefit Plan Disclosure [Line Items]
 
Company's contributions
2.2 
Minimum [Member] |
VEBA Trusts And 401(h) Accounts [Member]
 
Defined Benefit Plan Disclosure [Line Items]
 
Estimated future contributions in remainder of fiscal year
1.0 
Maximum [Member] |
Retirement Plan [Member]
 
Defined Benefit Plan Disclosure [Line Items]
 
Estimated future contributions in remainder of fiscal year
5.0 
Maximum [Member] |
VEBA Trusts And 401(h) Accounts [Member]
 
Defined Benefit Plan Disclosure [Line Items]
 
Estimated future contributions in remainder of fiscal year
$ 3.0 
Retirement Plan And Other Post-Retirement Benefits (Components Of Net Periodic Benefit Cost) (Details) (USD $)
In Thousands, unless otherwise specified
3 Months Ended 6 Months Ended
Mar. 31, 2017
Mar. 31, 2016
Mar. 31, 2017
Mar. 31, 2016
Retirement Plan [Member]
 
 
 
 
Defined Benefit Plan Disclosure [Line Items]
 
 
 
 
Service Cost
$ 2,992 
$ 2,928 
$ 5,984 
$ 5,855 
Interest Cost
9,596 
10,579 
19,192 
21,158 
Expected Return on Plan Assets
(14,929)
(14,842)
(29,859)
(29,685)
Amortization of Prior Service Cost (Credit)
264 
308 
529 
617 
Amortization of Losses
10,672 
8,062 
21,343 
16,124 
Net Amortization and Deferral For Regulatory Purposes (Including Volumetric Adjustments)
6,234 1
5,609 1
6,770 1
7,516 1
Net Periodic Benefit Cost
14,829 
12,644 
23,959 
21,585 
Other Post-Retirement Benefit Plans, Defined Benefit [Member]
 
 
 
 
Defined Benefit Plan Disclosure [Line Items]
 
 
 
 
Service Cost
612 
583 
1,224 
1,166 
Interest Cost
4,752 
5,096 
9,504 
10,193 
Expected Return on Plan Assets
(7,865)
(7,883)
(15,729)
(15,768)
Amortization of Prior Service Cost (Credit)
(107)
(228)
(214)
(456)
Amortization of Losses
4,604 
1,382 
9,207 
2,765 
Net Amortization and Deferral For Regulatory Purposes (Including Volumetric Adjustments)
3,790 1
6,599 1
5,102 1
10,720 1
Net Periodic Benefit Cost
$ 5,786 
$ 5,549 
$ 9,094 
$ 8,620 
Regulatory Matters (Details) (USD $)
In Millions, unless otherwise specified
6 Months Ended
Mar. 31, 2017
Regulatory Matters [Line Items]
 
Amount of requested increase to annual revenues
$ 41.7 
Recommended rate increase to annual revenues
8.5 
Recommended Equity Ratio
42.30% 
Recommended Cost of Equity
8.60% 
Approved Rate Increase
5.9 
Approved Cost of Equity
8.70% 
Approved Equity Ratio
42.90% 
Empire [Member]
 
Regulatory Matters [Line Items]
 
Depreciation Rate
2.50% 
Revenue Sharing Mechanism Level
73.5 
Empire [Member] |
Maximum [Member]
 
Regulatory Matters [Line Items]
 
Estimated Reduction in Annual Revenues
Empire [Member] |
Minimum [Member]
 
Regulatory Matters [Line Items]
 
Estimated Reduction in Annual Revenues
$ 3 
Rate Settlement [Member] |
Empire [Member]
 
Regulatory Matters [Line Items]
 
Depreciation Rate
2.00% 
November 1, 2015 [Member] |
Supply Corporation [Member]
 
Regulatory Matters [Line Items]
 
Reduction in Rates
2.00% 
November 1, 2016 [Member] |
Supply Corporation [Member]
 
Regulatory Matters [Line Items]
 
Reduction in Rates
2.00% 
Subsequent Event (Details) (USD $)
In Millions, unless otherwise specified
Mar. 31, 2017
Subsequent Events [Abstract]
 
Project Costs
$ 67.8