Oil and gas production for 2005 was 87.4 billion cubic feet of gas equivalent (BCFE) compared to 75.4 BCFE for 2004. The average realized price per MCFE increased $2.66 to $8.14 in 2005, a 49% increase from the average price realized in 2004.
Earnings for the fourth quarter of 2005 were $51.2 million, or $0.78 per diluted share, compared to $26.6 million, or $0.42 per diluted share, for the fourth quarter of 2004. Revenues for the fourth quarter of 2005 were $227.9 million compared to $126.4 million for the same period in 2004. Discretionary cash flow for the fourth quarter of 2005 increased 64% from the same period in 2004 to $137.0 million. Net cash provided by operating activities increased to $107.2 million in the fourth quarter of 2005 from $80.0 million in the fourth quarter of 2004. Average daily oil and gas production during the fourth quarter 2005 totaled 237.6 MMCFE, up 10% from 216.3 MMCFE in the comparable 2004 period. Average prices realized during the quarter were $10.74 per Mcf and $53.46 per barrel, which were 75% and 45% higher, respectively, than the realized prices in the fourth quarter of 2004.
Mark Hellerstein, Chairman, President and CEO, commented: "We realized record earnings per share for the year 2005 as a result of a 16% increase in production as well as higher commodity prices. We grew our reserves 21% in 2005 and replaced 256% of our production, with 199% through the drill bit. We begin 2006 with a strong balance sheet and the largest prospect inventory in the Company's history, including our multi-year development programs in the Middle Bakken, the Hanging Woman Basin, the Centrahoma field, the Atoka/Granite Wash program at Northeast Mayfield and the Elm Grove field in northern Louisiana. We increased our 2006 drilling capital expenditure budget 50% to $500 million. We are looking forward to continued growth in 2006."
Operations and Guidance Update
Since our operations update on January 26, 2006, we have had the following significant developments:
The Company's updated forecast for the first quarter and the full year of 2006 is as follows:
1st Quarter Year ------------------- ------------------- Oil and gas production 21.5 - 22.5 BCFE 96.0 - 98.0 BCFE Lease operating expenses, including transportation $1.16 - $1.22/MCFE $1.18 - $1.24/MCFE Production taxes $0.55 - $0.60/MCFE $0.55 - $0.60/MCFE General and administrative exp. $0.50 - $0.55/MCFE $0.45 - $0.50/MCFE Depreciation, depletion & amort. $1.67 - $1.73/MCFE $1.92 - $1.98/MCFE
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