Mariner Has 25% Hike in 2007 Production, 222% Reserve Replacement
Mariner Energy reported net production for the fourth quarter of 2007 was 27.1 billion cubic feet of natural gas equivalents (Bcfe), compared to 26.0 Bcfe for the fourth quarter 2006.
Total natural gas net production for the fourth quarter 2007 was 18.4 billion cubic feet (Bcf), compared to 18.2 Bcf for the fourth quarter 2006. Total oil net production for the fourth quarter 2007 was 1.1 million barrels (MMBbls), compared to 1.0 MMBbls for the same period in 2006.
Natural gas liquids (NGL) net production for the fourth quarter 2007 was 0.3 MMBbls, unchanged from the fourth quarter 2006.
For the full-year 2007, Mariner reported net production of 100.3 Bcfe, compared to 80.5 Bcfe for 2006.
This represents a 25% increase year-over-year. Total natural gas net production during 2007 was 67.8 Bcf at an average realized price of $7.88 per Mcf, compared to 56.1 Bcf for 2006 at an average realized price of $7.37 per Mcf. Total oil net production during 2007 was 4.2 MMBbls at an average realized price of $67.50 per Bbl, compared to 3.2 MMBbls during 2006 at an average realized price of $62.63 per Bbl.
Total NGL net production during 2007 was 1.2 MMBbls at an average realized price of $45.16 per Bbl, compared to 0.8 MMBbls during 2006 at an average realized price of $48.37 per Bbl. Average realized prices reflect settlements during the period under Mariner's hedging program.
Mariner ended 2007 with estimated proved reserves of 835.8 Bcfe, compared to 715.5 Bcfe at year end 2006. This represents a 17% increase in estimated proved reserves year-over-year.
Mariner's year-end estimated proved reserves were fully engineered by the independent engineering firm of Ryder Scott Company, L.P. Mariner achieved a reserve replacement rate of 222% from all sources, including acquisitions and divestitures, at an all-in reserve replacement cost of $3.49 per Mcfe.
For a description of the calculations of reserve replacement rate and reserve replacement cost, please see the notes below regarding "Reserve replacement rate" and "Reserve replacement cost." Of the 2007 year-end estimated proved reserves, 67.5% are proved developed, 46.3% are oil and NGLs, and 46.5% are in West Texas, versus 57.1%, 40.4%, and 35.9%, respectively, at year-end 2006.
Commenting on Mariner's 2007 results, Scott D. Josey, Mariner's Chairman, Chief Executive Officer and President stated: "With the excellent reserve replacement cost and double-digit growth in production, net income, operating cash flow and reserves, Mariner turned in a successful year in 2007 by all measures. With the commencement of first production at Northwest Nansen and Bass Lite, the closing of the StatoilHydro transaction, and our lease sale awards, we have laid the groundwork for a promising 2008."
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