Cimarex's third-quarter 2005 oil and gas production volumes increased by 102 percent over the same period a year earlier to 445.8 million cubic feet equivalent per day (MMcfe/d). Gas production rose 92 percent to 337.8 million cubic feet per day and oil volumes increased 145 percent to 18,000 barrels per day.
Average realized prices for the third quarter are expected to range between $7.80 to $7.95 per thousand cubic feet of gas and $59.30 to $59.60 per barrel of oil.
The significant increase in this quarter's production is principally a result of closing the Magnum Hunter acquisition on June 7, 2005. However, third quarter production volumes were negatively impacted by Hurricanes Cindy, Dennis, Emily, Katrina and Rita.
Cimarex expects to recognize an $82 million pre-tax charge in the third quarter related to oil and gas derivative contracts, which equates to $0.63 per basic share after tax, associated with swaps and collars assumed as part of the Magnum Hunter acquisition which do not qualify for hedge accounting. The charge includes both non-cash mark-to-market derivative losses as well as cash settlements. Cash payments related to these contracts that settled in the third quarter totaled $15.6 million. The following is a summary of the company's open derivative contracts as of September 30, 2005:
Weighted Average Commodity Type Volume/Day Duration Price Natural Gas Collar 40,000 MMBtu Oct 05 - Dec 05 $4.00-$6.25 Natural Gas Collar 10,000 MMBtu Oct 05 - Dec 05 $4.25-$6.60 Natural Gas Collar 10,000 MMBtu Oct 05 - Dec 05 $5.00-$9.50 Natural Gas Swap 20,000 MMBtu Oct 05 - Dec 05 $6.25 Natural Gas Collar 20,000 MMBtu Jan 06 - Dec 06 $5.25-$6.30 Crude Oil Swap 1,000 Bbl Oct 05 - Dec 05 $34.90 Crude Oil Collar 1,000 Bbl Oct 05 - Dec 05 $35.00-$55.00 Crude Oil Collar 1,000 Bbl Jan 06 - Dec 06 $30.00-$35.85
Cimarex will release its third-quarter 2005 financial and operating results on Thursday November 3, 2005 before the market opens and will host a follow-up conference call and web cast at 11 a.m. Mountain Time (1:00 p.m. Eastern Time). To access the live, interactive conference call, please dial 888-858-4710 ten minutes before the scheduled start time. The listen-only web cast of the call will be accessible via www.cimarex.com.
Most Popular Articles