During 2004, XTO Energy added 2.047 Tcfe at a cost of $1.26 per thousand cubic feet of gas equivalent (Mcfe), replacing 551% of production. Including asset retirement obligations, the cost rises to $1.29 per Mcfe. The Company's development program replaced 195% of production or 724 billion cubic feet equivalent (Bcfe) at a cost of $0.88 per Mcfe.
Natural gas reserves increased 29% to 4.715 Tcf, and natural gas combined with natural gas liquids of 38.5 million barrels equaled 84% of total reserves. Oil reserves increased 175% to 152.5 million barrels. Proved developed reserves accounted for 72.3% of total proved reserves on an Mcfe basis. At year-end 2004, the Company's reserve-to-production index was 15.1 years.
"Our proven strategy, acquiring quality assets and making them better, continues to build a property base that delivers both consistent growth and leading economic returns for our shareholders," stated Bob R. Simpson, Chairman and Chief Executive Officer. "The results of our development program illustrate the ongoing prosperity of our low-risk drilling inventory. In conjunction, the 2004 record acquisitions of $2 billion scale-up our growth platform at yesterday's prices."
Based on year-end prices of $5.69 per thousand cubic feet of gas (Mcf), $28.24 per barrel of natural gas liquids and $41.03 per barrel of oil and on constant cost assumptions, estimated future net cash flows, before income taxes, totaled $23.6 billion at December 31, 2004. The present value before income tax, discounted at 10%, was $12.2 billion, compared to $8.6 billion at year-end 2003. Year-end 2003 prices were $5.71 per Mcf of gas, $23.17 per barrel of natural gas liquids and $30.55 per barrel of oil.
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