If Oswalt's mutual option had been exercised he would have been paid $16 million next season, too much in the Phillies' minds considering that he finished 9-10 with a 3.69 ERA this season and missed time because of back problems. If Lidge's player option had been exercised he would have been paid $12.5 million, too much considering the Phillies plan to re-sign Ryan Madson or somebody like Heath Bell or Jonathan Papelbon to be their closer.
Oswalt will receive a $2 million buyout. Lidge will receive a $1.5 million buyout.
"We will remain in contact with representatives for both players about the possibility of bringing them back for the 2012 season," Phillies general manager Ruben Amaro Jr. said in a statement. "Brad and Roy both made significant contributions to the Phillies over the past several seasons."
Agents representing both players said Monday in telephone interviews there is interest in returning to Philadelphia.
"Roy would definitely like to come back, but he'd also like to see what else is out there," said Bob Garber, who represents Oswalt. "Roy would like to test the free-agent market. It's the first time he's had a chance to do that. But we'll continue talking to the Phillies about something on more than a one-year basis."
Oswalt, who joined the Phillies following a July 2010 trade with the Houston Astros, looked healthy late in the season. Garber is optimistic that Oswalt's back will no longer a problem.
"We've solved his back issue after he went to the right doctor," he said. "I think that issue is behind him hopefully. He knows how to manage his back a lot better than he has in the past."
Oswalt, 34, had said as late as August he hadn't decided if he planned to play following his current contract but said in October he no longer had retirement on his mind.
"I'd love to play," he said just before the postseason. "I'll play for any team in the big leagues. ... I feel like I can compete. I still feel like I've got good enough stuff to compete. I don't want to leave and then regret it later, more than anything."
Lidge, 34, went 0-2 with one save and a 1.40 ERA in 25 appearances this season. He struck out 23 batters in 19 1/3 innings, averaging 10.7 strikeouts per nine innings. In four seasons (2008-11) with Philadelphia, Lidge went 3-11 with 100 saves and a 3.73 ERA. In 22 postseason appearances, he went 1-1 with 12 saves in 12 opportunities and a 1.77 ERA.
Lidge, who memorably recorded the final out to give the Phillies the 2008 World Series championship, has had various injuries during his four-year tenure with the Phillies, but pitched effectively in the late innings this season. The Phillies might want a veteran arm or two in the bullpen while they continue their youth movement with Mike Stutes, Antonio Bastardo, David Herndon, Justin De Fratus, Michael Schwimer and others like Phillippe Aumont and Joe Savery.
Lidge is regarded as a tremendous clubhouse presence, and if he can stay healthy could serve two roles: productive late-inning reliever and mentor.
"He clearly would be open to coming back," said Rex Gary, who is Lidge's agent. "This is with every awareness the Phillies are going to sign Madson or somebody else to close."
Said Lidge, following Game 5 of the National League Division Series: "Obviously, this team, this organization, these fans are pretty tough to walk away from no matter what. I'm not sure what's going to happen. I'm not sure what's out there. The way the season ended I felt pretty good about the way I was throwing. I don't know what's out there for me. I guess we'll see how it unfolds."
Lidge said closing again is "important, if there's any opportunity. ... I feel like I can still close games. I don't know if that's out there for me. If it is, I'd definitely have to look at it."
Todd Zolecki is a reporter for MLB.com. This story was not subject to the approval of Major League Baseball or its clubs.