Commitments and Contingencies Included below is a discussion of various future commitments of the Company as of December 31, 2018 . The commitments under these arrangements are not recorded in the accompanying consolidated balance sheets at December 31, 2018 . Drilling commitments  As of December 31, 2018 , the Company has drilling rig contracts with various terms extending to February 2020 to ensure rig availability in its key operating areas. Future operating day-rate commitments as of December 31, 2018 total approximately $107 million , of which $106 million is expected to be incurred in 2019 and $1 million in 2020. A portion of these future costs will be borne by other interest owners. Such future commitments include minimum payment obligations to be incurred in 2019 and 2020 at a discounted present value totaling $13 million that qualify as leases and were recognized on the Company's balance sheet on January 1, 2019 upon adoption of ASU 2016-02 as discussed in Note 1. Organization and Summary of Significant Accounting PoliciesNew accounting pronouncements not yet adopted at December 31, 2018Leases . Transportation and processing commitments  The Company has entered into transportation and processing commitments to guarantee capacity on crude oil and natural gas pipelines and natural gas processing facilities. The commitments, which have varying terms extending as far as 2028, require the Company to pay per-unit transportation or processing charges regardless of the amount of capacity used. Future commitments remaining as of December 31, 2018 under the arrangements amount to approximately $1.83 billion , of which $241 million is expected to be incurred in 2019, $273 million in 2020, $254 million in 2021, $249 million in 2022, $248 million in 2023, and $566 million thereafter. A portion of these future costs will be borne by other interest owners. The Company is not committed under the above contracts to deliver fixed and determinable quantities of crude oil or natural gas in the future. These commitments do not qualify as leases to be recognized on the balance sheet under ASU 2016-02 beginning January 1, 2019. Litigation  In November 2010, a putative class action was filed in the District Court of Blaine County, Oklahoma by Billy J. Strack and Daniela A. Renner as trustees of certain named trusts and on behalf of other similarly situated parties against the Company. The Petition, as amended, alleged the Company improperly deducted post-production costs from royalties paid to plaintiffs and other royalty interest owners from crude oil and natural gas wells located in Oklahoma. The plaintiffs alleged a number of claims, including breach of contract, fraud, breach of fiduciary duty, unjust enrichment, and other claims and sought recovery of compensatory damages, interest, punitive damages and attorney fees on behalf of the proposed class. The Company denied all allegations and denied that the case was properly brought as a class action. On June 11, 2015, the trial court certified a hybrid class requested by plaintiffs over the objections of the Company. The Company appealed the trial courts class certification order. On February 8, 2017, the Oklahoma Court of Civil Appeals reversed the trial courts ruling on certification and remanded the case for further proceedings. After certification of the case as a class action was reversed the parties engaged in settlement negotiations. Due to the uncertainty of and burdens of litigation, on February 16, 2018 the Company reached a settlement in connection with this matter. Under the settlement, the Company initially expected to make payments and incur costs associated with the settlement of approximately $59.6 million and accrued a loss for such amount at December 31, 2017. On April 3, 2018, the District Court of Garfield County, Oklahoma preliminarily approved the settlement and set certain dates applicable to the settlement including the timing and content of Notice, Opt-out, and Objections to Class Members. On June 12, 2018, the court entered an order formally approving the settlement, which is not subject to appeal. In the third quarter of 2018, the Company made payments totaling $45.8 million to satisfy the majority of its obligations under the settlement. The Company's remaining loss accrual for this matter totals $19.8 million at December 31, 2018 , representing additional settlement obligations expected to be satisfied in 2019. The accrual for this matter is included in Accrued liabilities and other on the consolidated balance sheets. The Company is involved in various other legal proceedings including, but not limited to, commercial disputes, claims from royalty and surface owners, property damage claims, personal injury claims, regulatory compliance matters, disputes with tax authorities and other matters. While the outcome of these legal matters cannot be predicted with certainty, the Company does not expect them to have a material effect on its financial condition, results of operations or cash flows. In addition to the accrued loss on the matter described above, as of December 31, 2018 and 2017 the Company had recorded a liability in the consolidated balance sheets under the caption Other noncurrent liabilities of $4.7 million and $7.6 million , respectively, for various matters, none of which are believed to be individually significant. Environmental risk  Due to the nature of the crude oil and natural gas business, the Company is exposed to possible environmental risks. The Company is not aware of any material environmental issues or claims.