The Company expects year-end 2004 proved reserves to exceed 5.8 trillion cubic feet of gas equivalent (Tcfe). These reserve volumes imply an all-in finding and development cost for the year, including acquisitions, of between $1.15 - $1.25 per thousand cubic feet of gas equivalent (Mcfe). Proved reserves estimates, prepared by Miller & Lents, Ltd., will be available by late February.
XTO Energy has prepared guidance for 2005 based on current expectations for production, expenses and other parameters resulting from ongoing operations and the Company's 2005 capital budget. These statements are forward looking, as described in the final paragraph of this release, and actual results may differ materially. These estimates do not include derivative fair value gains and losses, the effects of possible future acquisitions or divestitures, or unforeseen events that may occur after this release.
The Company's estimated ranges of average daily production for 2005:
Nine Months Q1 Q2 - Q4 Natural Gas (Mmcf) 920 - 930 1,000 - 1,040 NGL (Mbbl) 7.5 - 8.0 7.5 - 8.0 Oil (Mbbl) 31.5 - 32.5 31.5 - 32.5 Total Gas Equivalent (Mcfe) 1,154 - 1,173 1,234 - 1,283
For the year, the Company's realized natural gas prices are expected to be $0.60 to $0.70 below the NYMEX Henry Hub price, assuming a $6.00 per Mcf gas price and before consideration of hedging activities. Natural gas liquids prices are expected to be about 55% to 65% of the average NYMEX oil price. The Company's realized oil prices should be about $2.50 to $3.50 below the average NYMEX price, assuming a $42.00 per Bbl oil price and before consideration of hedging activities.
The following table presents the Company's expected expenses per Mcfe for 2005 assuming a $6.00 per Mcf NYMEX gas price and a $42.00 per Bbl NYMEX oil price:
Expense ($/Mcfe) Q1 Q2 - Q4 Production $0.71 $0.70 Taxes, transportation and other 0.52 0.52 Exploration 0.03 0.03 Depreciation, depletion and amortization 1.15 1.21 Accretion of asset retirement obligation 0.03 0.03 General and administrative (a) 0.18 0.18 Interest 0.26 0.26 (a) Excludes stock-based incentive compensation
The Company's hedging positions for natural gas and oil are summarized below:
Mcf or Bbls NYMEX Price per Day per Mcf or Bbls Natural Gas Jan-Dec 2005 250,000 $ 5.90 Oil Jan-Dec 2005 15,000 $ 38.37
For 2005, the Company projects a 35% effective tax rate, with up to 40% of that amount expected to be currently payable.
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