text: **NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS**
  
  **NOTE 14 – FAIR VALUE MEASUREMENT continued**
  
  **Measurement of Fair Value**
  
  **a) Derivatives**
  
  Derivatives entered into by the Company consist of commodity contracts and interest rate swaps. The Company 
  utilises present value techniques and option-pricing models for valuing its derivatives. Inputs to these valuation 
  techniques include published forward prices, volatilities, and credit risk considerations, including the incorporation 
  of published interest rates and credit spreads. All of the significant inputs are observable, either directly or indirectly; 
  therefore, the Company’s derivative instruments are included within the Level 2 fair value hierarchy. 
  
  **b) Credit Facilities**
  
  As at 31 December 2014, the Company had $95 million and $35 million of principal debt outstanding on the Senior 
  Credit Facility and the Junior Credit Facility, respectively. The estimated fair value of the Senior Credit Facility 
  approximated its carrying amount due to the floating interest rate paid on such debt to be set for a period of three 
  months or less. The estimated fair value of the Junior Credit Facility was approximately $41.8 million, based on 
  indirect, observable inputs (Level 2) regarding interest rates available to the Company. The fair value of the Junior 
  Credit Facility was determined by using a discounted cash flow model using a discount rate that reflects the 
  Company’s assumed borrowing rate at the end of the reporting period. 