Callon Petroleum Grows Proved Reserves by 6%

Callon Petroleum ended 2009 with estimated net proved reserves of 58.0 billion cubic feet of natural gas equivalent (Bcfe), compared to 2008 year-end proved reserves of 54.8 Bcfe, a 6% increase. The 2009 year-end reserves were 67% crude oil. Callon added 15.0 Bcfe of net proven reserves replacing 127% of the reserves produced in 2009.

"We were very pleased to be able to replace our production and to grow our proved reserves during 2009 which was a year of transition for our company," Fred Callon, Chairman and CEO points out. "More importantly, we added significantly to our resource base, which will help provide growth over the next several years."

At December 31, 2009, the company’s independent petroleum engineers estimated the present value of the company's estimated future net revenues from proved reserves, excluding income taxes (which is a non-GAAP financial measure), using Securities and Exchange Commission (SEC) pricing guidelines for year-end 2009 discounted at 10%, to be $137.4 million. The year-end pricing used in calculating such present value averaged $4.75 per thousand cubic feet of natural gas and $57.40 per barrel of oil. Callon compiled year-end reserve data utilizing new guidelines from the SEC. The changes, intended to provide greater clarity for investors, also give companies enhanced flexibility in reporting. The new rules had a minimal effect on Callon's reported volumes.