Newfield Bumps Up Reserves to 3.6 Tcfe
Newfield announced that its proved reserves at December 31, 2009 were 3.6 Tcfe, a 23% increase over proved reserves at year-end 2008. Newfield replaced approximately 250% of 2009 production with the addition of new proved reserves, excluding the impact of new Securities and Exchange Commission (SEC) reserve reporting rules. Substantially all of the reserve additions were from organic drilling programs. The Company's proved reserve life index of approximately 14 years reflects continued growth in longer-lived and more predictable resource plays.
At year-end 2009, approximately 53% of the Company's proved reserves were proved developed and 72% were natural gas. Proved reserves in Newfield's two largest divisions - the Mid-Continent and Rocky Mountains - increased 34% and now represent more than 80% of the Company's total proved reserves.
For 2009, Newfield added 1,342 Bcfe of proved reserves, of which approximately half were related to recent changes in SEC reserve reporting rules expanding proved undeveloped reserve locations beyond one offset. Negative price and performance related revisions were 259 Bcfe and 125 Bcfe, respectively. Our proved developed reserves at year-end 2009 were 4% higher than our proved developed reserves at year-end 2008. Proved Oil & Gas Reserves and Capital Expenditures tables are included below in this release.
Newfield invested approximately $1.4 billion in 2009. Finding and development (F&D) costs in 2009, including price and performance revisions, averaged approximately $1.50 per Mcfe. Excluding the negative impact of price related reserve revisions, finding and development costs would have been approximately $1.18 per Mcfe. See "Explanation of Non-GAAP Financial Measures" found at the end of this release for a discussion of our calculation of F&D costs.
Without the benefit of the SEC rule change expanding proved undeveloped reserve locations beyond one offset, Newfield's total proved reserves would have been flat, despite the significant drop in North American natural gas prices. The Company's finding and development costs without the benefit of the SEC rule change and excluding the price related revisions would have been approximately $2.73 per Mcfe. Assuming a natural gas price of $5.50 per MMBtu for year-end 2009 reserve calculations, substantially all of the price-related natural gas revisions would not have occurred.
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