Energen (EGN) 10-K 25 Feb 10 2009 FY Annual report Financial data

Statement Of Income Alternative

Statement Of Income Alternative (USD $)
In Thousands, except Share data	12 Months Ended Dec. 31, 2009	12 Months Ended Dec. 31, 2008	12 Months Ended Dec. 31, 2007
Operating Revenues
Oil and gas operations	$822,546	$914,132	$825,592
Natural gas distribution	617,874	654,778	609,468
Total operating revenues	1,440,420	1,568,910	1,435,060
Operating Expenses
Cost of gas	306,054	351,774	318,429
Operations and maintenance	380,625	354,760	333,443
Depreciation, depletion and amortization	235,084	188,413	161,377
Taxes, other than income taxes	78,329	107,605	95,831
Accretion expense	4,935	4,290	3,948
Total operating expenses	1,005,027	1,006,842	913,028
Operating Income	435,393	562,068	522,032
Other Income (Expense)
Interest expense	(39,379)	(41,981)	(47,100)
Other income	4,972	1,885	2,668
Other expense	(690)	(7,014)	(959)
Total other expense	(35,097)	(47,110)	(45,391)
Income From Continuing Operations Before Income Taxes	400,296	514,958	476,641
Income tax expense	143,971	193,043	167,429
Income From Continuing Operations	256,325	321,915	309,212
Discontinued Operations, Net of Taxes
Income from discontinued operations	0	0	3
Gain on disposal of discontinued operations	0	0	18
Income From Discontinued Operations	0	0	21
Net Income	$256,325	$321,915	$309,233
Diluted Earnings Per Average Common Share
Continuing operations	3.57	4.47	4.28
Discontinued operations	$0	$0	$0
Net Income	3.57	4.47	4.28
Basic Earnings Per Average Common Share
Continuing operations	3.58	4.5	4.32
Discontinued operations	$0	$0	$0
Net Income	3.58	4.5	4.32
Diluted Average Common Shares Outstanding	71,885,422	72,030,210	72,180,861
Basic Average Common Shares Outstanding	71,667,304	71,600,925	71,591,551

Statement Of Financial Position

Statement Of Financial Position Classified (USD $)
In Thousands	Dec. 31, 2009	Dec. 31, 2008
Current Assets
Cash and cash equivalents	$75,844	$13,177
Accounts receivable, net of allowance for doubtful accounts of $17,251 and $12,868 at December 31, 2009 and 2008, respectively	327,163	414,362
Inventories
Storage gas inventory	42,475	77,243
Materials and supplies	17,440	13,541
Liquified natural gas in storage	3,409	3,219
Regulatory asset	33,196	41,714
Income tax receivable	4,552	50,476
Prepayments and other	11,527	29,309
Total current assets	515,606	643,041
Property, Plant and Equipment
Oil and gas properties, successful efforts method	3,379,128	2,959,665
Less accumulated depreciation, depletion and amortization	972,676	793,465
Oil and gas properties, net	2,406,452	2,166,200
Utility plant	1,211,624	1,166,967
Less accumulated depreciation	489,924	480,601
Utility plant, net	721,700	686,366
Other property, net	16,317	15,082
Total property, plant and equipment, net	3,144,469	2,867,648
Other Assets
Regulatory asset	102,133	97,511
Long-term derivative instruments	7,824	140,603
Deferred charges and other	33,086	26,601
Total other assets	143,043	264,715
TOTAL ASSETS	3,803,118	3,775,404
Current Liabilities
Long-term debt due within one year	150,000	0
Notes payable to banks	0	62,000
Accounts payable	164,327	224,309
Accrued taxes	49,884	42,183
Customers' deposits	20,836	22,081
Amounts due customers	24,106	15,124
Accrued wages and benefits	27,347	24,966
Regulatory liability	29,719	25,363
Royalty payable	19,034	12,275
Deferred income taxes	10,015	41,969
Other	25,493	39,831
Total current liabilities	520,761	510,101
Long-term debt	410,786	561,631
Deferred Credits and Other Liabilities
Asset retirement obligation	88,298	66,151
Pension and other postretirement liabilities	55,899	67,474
Regulatory liability	155,088	147,514
Deferred income taxes	505,460	482,058
Long-term derivative instruments	60,446	8,821
Other	18,137	18,364
Total deferred credits and other liabilities	883,328	790,382
Shareholders' Equity
Preferred stock, cumulative, $0.01 par value, 5,000,000 shares authorized	0	0
Common shareholders' equity
Common stock, $0.01 par value; 150,000,000 shares authorized, 74,593,431 shares issued at December 31, 2009 and 74,521,957 shares issued at December 31, 2008	746	745
Premium on capital stock	461,661	454,778
Capital surplus	2,802	2,802
Retained earnings	1,626,753	1,405,970
Accumulated other comprehensive gain (loss), net of tax
Unrealized gain on hedges, net	49,405	200,867
Pension and postretirement plans	(31,790)	(31,050)
Deferred compensation plan	3,121	2,948
Treasury stock, at cost; 2,991,373 shares and 2,977,947 shares at December 31, 2009 and 2008, respectively	(124,455)	(123,770)
Total shareholders' equity	1,988,243	1,913,290
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY	$3,803,118	$3,775,404

1_Statement Of Financial Positi

Statement Of Financial Position Classified (Parenthetical) (USD $)
In Thousands, except Share data	Dec. 31, 2009	Dec. 31, 2008
Accounts receivable, allowance for doubtful accounts	$17,251	$12,868
Preferred stock cumulative, par value	0.01	0.01
Preferred stock cumulative, shares authorized	5,000,000	5,000,000
Common stock, par value	0.01	0.01
Common stock, shares authorized	150,000,000	150,000,000
Common stock, shares issued	74,593,431	74,521,957
Treasury stock, shares	2,991,373	2,977,947

Statement Of Shareholders Equit

Statement Of Shareholders Equity And Other Comprehensive Income (USD $)
In Thousands, except Share data	Common Stock	Premium on Capital Stock	Capital Surplus	Retained Earnings	Accumulated Other Comprehensive Income (Loss)	Deferred Compensation Plan	Treasury Stock	Total
BEGINNING BALANCE at Dec. 31, 2006	$737	$412,989	$2,802	$844,880	$27,378	$13,956	($100,673)	$1,202,069
BEGINNING BALANCE (in shares) at Dec. 31, 2006	73,699,244
Net income				309,233				309,233
Other comprehensive income (loss):
Change in fair value of derivative instruments, net of tax of ($2,032) in 2009, $120,742 in 2008 and ($44,619) in 2007					(72,800)			(72,800)
Reclassification adjustment, net of tax of ($90,799) in 2009, $42,243 in 2008 and ($26,239) in 2007					(42,811)			(42,811)
Pension and postretirement plans, net of tax of ($397) in 2009, ($5,324) in 2008 and $1,082 in 2007					2,009			2,009
Initial recognition for uncertain tax positions				(1,181)				(1,181)
Purchase of treasury shares, net							(6,760)	(6,760)
Shares issued for employee benefit plans (in shares)	491,542
Shares issued for employee benefit plans	5	9,671						9,676
Deferred compensation obligation						2,165	(2,165)	0
Stock based compensation		1,402						1,402
Tax benefit from employee stock plans		10,937						10,937
Cash dividends - $0.50 in 2009, $0.48 in 2008 and $0.46 in 2007 per share				(33,116)				(33,116)
ENDING BALANCE (in shares) at Dec. 31, 2007	74,190,786
ENDING BALANCE at Dec. 31, 2007	742	434,999	2,802	1,119,816	(86,224)	16,121	(109,598)	1,378,658
Net income				321,915				321,915
Other comprehensive income (loss):
Change in fair value of derivative instruments, net of tax of ($2,032) in 2009, $120,742 in 2008 and ($44,619) in 2007					197,000			197,000
Reclassification adjustment, net of tax of ($90,799) in 2009, $42,243 in 2008 and ($26,239) in 2007					68,924			68,924
Pension and postretirement plans, net of tax of ($397) in 2009, ($5,324) in 2008 and $1,082 in 2007					(9,883)			(9,883)
Purchase of treasury shares, net							(27,345)	(27,345)
Shares issued for employee benefit plans (in shares)	331,171
Shares issued for employee benefit plans	3	8,548						8,551
Deferred compensation obligation						(13,173)	13,173	0
Stock based compensation		(5,862)						(5,862)
Tax benefit from employee stock plans		17,093						17,093
Change in measurement date for defined benefit and postretirement plans, net of tax of ($614)				(1,141)				(1,141)
Cash dividends - $0.50 in 2009, $0.48 in 2008 and $0.46 in 2007 per share				(34,620)				(34,620)
ENDING BALANCE (in shares) at Dec. 31, 2008	74,521,957							74,521,957
ENDING BALANCE at Dec. 31, 2008	745	454,778	2,802	1,405,970	169,817	2,948	(123,770)	1,913,290
Net income				256,325				256,325
Other comprehensive income (loss):
Change in fair value of derivative instruments, net of tax of ($2,032) in 2009, $120,742 in 2008 and ($44,619) in 2007					(3,316)			(3,316)
Reclassification adjustment, net of tax of ($90,799) in 2009, $42,243 in 2008 and ($26,239) in 2007					(148,146)			(148,146)
Pension and postretirement plans, net of tax of ($397) in 2009, ($5,324) in 2008 and $1,082 in 2007					(740)			(740)
Purchase of treasury shares, net							(512)	(512)
Shares issued for employee benefit plans (in shares)	71,474
Shares issued for employee benefit plans	1	994						995
Deferred compensation obligation						173	(173)	0
Stock based compensation		5,283						5,283
Tax benefit from employee stock plans		606						606
Cash dividends - $0.50 in 2009, $0.48 in 2008 and $0.46 in 2007 per share				(35,542)				(35,542)
ENDING BALANCE (in shares) at Dec. 31, 2009	74,593,431							74,593,431
ENDING BALANCE at Dec. 31, 2009	$746	$461,661	$2,802	$1,626,753	$17,615	$3,121	($124,455)	$1,988,243

2_Statement Of Shareholders Equ

Statement Of Shareholders Equity And Other Comprehensive Income (Parenthetical) (USD $)
In Thousands, except Per Share data	12 Months Ended Dec. 31, 2009	12 Months Ended Dec. 31, 2008	12 Months Ended Dec. 31, 2007
Change in fair value of derivative instruments, tax	($2,032)	$120,742	($44,619)
Reclassification adjustment, tax	(90,799)	42,243	(26,239)
Pension and postretirement plans, tax	(397)	(5,324)	1,082
Change in measurement date for defined benefit and postretirement plans, tax		($614)
Cash dividends, per share	0.5	0.48	0.46

Statement Of Cash Flows Indirec

Statement Of Cash Flows Indirect (USD $)
In Thousands	12 Months Ended Dec. 31, 2009	12 Months Ended Dec. 31, 2008	12 Months Ended Dec. 31, 2007
Operating Activities
Net income	$256,325	$321,915	$309,233
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation, depletion and amortization	235,084	188,413	161,377
Accretion expense	4,935	4,290	3,948
Deferred income taxes	84,616	188,414	1,162
Bad debt expense	10,688	6,471	5,408
Change in derivative fair value	(104)	(2,580)	(970)
Gain on sale of assets	(5,617)	(10,752)	(506)
Other, net	9,580	(13,807)	16,087
Net change in:
Accounts receivable	(31,914)	94	66,402
Inventories	30,679	1,274	(13,461)
Accounts payable	5,539	(36,149)	(74,927)
Amounts due customers	16,967	(16,873)	21,247
Accrued taxes	53,633	(48,986)	(5,765)
Other current assets and liabilities	9,046	(12,491)	(5,068)
Net cash provided by operating activities	679,457	569,233	484,167
Investing Activities
Additions to property, plant and equipment	(340,107)	(460,237)	(373,857)
Acquisitions, net of cash acquired	(185,131)	(17,914)	(56,323)
Proceeds from sale of assets	7,923	16,224	1,295
Other, net	(1,808)	(2,656)	(2,994)
Net cash used in investing activities	(519,123)	(464,583)	(431,879)
Financing Activities
Payment of dividends on common stock	(35,542)	(34,620)	(33,116)
Issuance of common stock	621	277	2,051
Reduction of long-term debt	(1,035)	(10,910)	(155,289)
Proceeds from issuance of long-term debt	0	0	45,000
Debt issuance costs	0	0	(494)
Net change in short-term debt	(62,000)	(72,000)	76,000
Tax benefit on stock compensation	606	17,093	10,937
Other	(317)	0	1,003
Net cash used in financing activities	(97,667)	(100,160)	(53,908)
Net change in cash and cash equivalents	62,667	4,490	(1,620)
Cash and cash equivalents at beginning of period	13,177	8,687	10,307
Cash and cash equivalents at end of period	$75,844	$13,177	$8,687

SUMMARY OF SIGNIFICANT ACCOUNTI

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
	12 Months Ended Dec. 31, 2009 USD / shares
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES	1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Energen Corporation (Energen or the Company) is a diversified energy holding company engaged primarily in the development, acquisition, exploration and production of oil and gas in the continental United States (oil and gas operations) and in the purchase, distribution, and sale of natural gas principally in central and north Alabama (natural gas distribution). The following is a description of the Companys significant accounting policies and practices. A. Principles of Consolidation The accompanying consolidated financial statements include the accounts of the Company and its subsidiaries, principally Energen Resources Corporation and Alabama Gas Corporation (Alagasco), after elimination of all significant intercompany transactions in consolidation. Certain reclassifications have been made to conform the prior years financial statements to the current-year presentation. B. Oil and Gas Operations Property and Related Depletion: Energen Resources follows the successful efforts method of accounting for costs incurred in the exploration and development of oil, gas and natural gas liquid reserves. Lease acquisition costs are capitalized initially, and unproved properties are reviewed periodically to determine if there has been impairment of the carrying value, with any such impairment charged to exploration expense currently. All development costs are capitalized. Exploratory drilling costs are capitalized pending determination of proved reserves. If proved reserves are not discovered, the exploratory drilling costs are expensed. Other exploration costs, including geological and geophysical costs, are expensed as incurred. Depreciation, depletion and amortization expense is determined on a field-by-field basis using the units-of-production method based on proved reserves. Anticipated abandonment and restoration costs are capitalized and depreciated using the units-of-production method based on proved developed reserves. Operating Revenue: Energen Resources utilizes the sales method of accounting to recognize oil, gas and natural gas liquids production revenue. Under the sales method, revenues are based on actual sales volumes of commodities sold to purchasers. Over-production liabilities are established only when it is estimated that a propertys over-produced volumes exceed the net share of remaining reserves for such property. Energen Resources had no material production imbalances at December31, 2009 and 2008. Derivative Commodity Instruments: Energen Resources recognizes all derivatives on the balance sheet and measures all derivatives at fair value. If a derivative is designated as a cash flow hedge, the effectiveness of the hedge, or the degree that the gain (loss) for the hedging instrument offsets the loss (gain) on the hedged item, is measured at each reporting period. The effective portion of the gain or loss on the derivative instrument is recognized in other comprehensive income (OCI) as a component of shareholders equity and subsequently reclassified to operating revenues when the forecasted transaction affects earnings. The ineffective portion of a deriva

REGULATORY MATTERS

REGULATORY MATTERS
	12 Months Ended Dec. 31, 2009 USD / shares
REGULATORY MATTERS	2. REGULATORY MATTERS Alagasco is subject to regulation by the APSC which established the Rate Stabilization and Equalization (RSE) rate-setting process in 1983. RSEs current extension is for a seven-year period through December31, 2014. RSE will continue after December31, 2014, unless, after notice to the Company and a hearing, the APSC votes to modify or discontinue the RSE methodology. Alagasco is on a September30 fiscal year for rate-setting purposes (rate year) and reports on a calendar year for Securities and Exchange Commission reporting purposes. Alagascos allowed range of return on average equity remains 13.15 percent to 13.65 percent throughout the term of the order. Under RSE the APSC conducts quarterly reviews to determine, based on Alagascos projections and year-to-date performance, whether Alagascos return on average equity at the end of the rate year will be within the allowed range of return. Reductions in rates can be made quarterly to bring the projected return within the allowed range; increases, however, are allowed only once each rate year, effective December1, and cannot exceed 4 percent of prior-year revenues. As of September30, 2009 and 2007, Alagasco had a $1.5 million pre-tax and a $3.6 million pre-tax, respectively, reduction in revenues to bring the return on average equity to midpoint within allowed range of return. Alagasco did not have a reduction in rates related to the return on average equity for the rate year ended 2008. Under the provisions of RSE, a $10.2 million, $24.7 million and $12 million annual increase in revenues became effective December1, 2009, 2008, and 2007, respectively. At September30, 2009, RSE limited the utilitys equity upon which a return is permitted to 55 percent of total capitalization, subject to certain adjustments. Under the inflation-based Cost Control Measurement (CCM) established by the APSC, if the percentage change in operations and maintenance (OM) expense on an aggregate basis falls within a range of 0.75 points above or below the percentage change in the Consumer Price Index For All Urban Consumers (Index Range), no adjustment is required. If the change in OM expense on an aggregate basis exceeds the Index Range, three-quarters of the difference is returned to customers. To the extent the change is less than the Index Range, the utility benefits by one-half of the difference through future rate adjustments. The OM expense base for measurement purposes will be set at the prior years actual OM expense amount unless the Company exceeds the top of the Index Range in two successive years, in which case the base for the following year will be set at the top of the Index Range. Certain items that fluctuate based on situations demonstrated to be beyond Alagascos control may be excluded from the CCM calculation. In the rate year ended September30, 2008, the increase in OM expense was below the Index Range; as a result the utility benefited by $2.9 million pre-tax with the related impact to rates effective December1, 2008. Alagascos OM expense fell within the Index Range for the rate years ended September30, 2009 and 2007. Alagascos rate schedules for natural gas distri

LONG-TERM DEBT AND NOTES PAYABL

LONG-TERM DEBT AND NOTES PAYABLE
	12 Months Ended Dec. 31, 2009 USD / shares
LONG-TERM DEBT AND NOTES PAYABLE	3. LONG-TERM DEBT AND NOTES PAYABLE Long-term debt consisted of the following: (in thousands) December31,2009 December31,2008 Energen Corporation: Medium-term Notes, Series A and B, interest ranging from 7.125% to 7.625%, for notes due December15, 2010, to February15, 2028 $305,000 $305,000 5% Notes, due October1, 2013 50,000 50,000 Alabama Gas Corporation: Medium-term Notes, Series A, interest of 7.57%, due September20, 2011 5,000 5,000 5.20% Notes, due January15, 2020 40,000 40,000 5.70% Notes, due January15, 2035 36,522 37,557 5.368% Notes, due December1, 2015 80,000 80,000 5.90% Notes, due January15, 2037 45,000 45,000 Total 561,522 562,557 Less amounts due within one year 150,000 - Less unamortized debt discount 736 926 Total $410,786 $561,631 The aggregate maturities of Energens long-term debt for the next five years are as follows: Years ending December31, (in thousands) 2010 2011 2012 2013 2014 $150,000 $5,000 $1,000 $50,000 - The aggregate maturities of Alagascos long-term debt for the next five years are as follows: Years ending December31, (in thousands) 2010 2011 2012 2013 2014 - $5,000 - - - The Companys various long-term debt and short-term debt agreements contain financial and nonfinancial covenants. Except as discussed below, debt covenants address routine matters such as timely payment of principal and interest, maintenance of corporate existence and restrictions on liens. The Companys outstanding debt is subject to a cross default provision under Energens Indenture dated September1, 1996 with The Bank of New York as Trustee. In the event Alagasco or Energen Resources had a debt default of more than $10 million it would also be considered an event of default by Energen under the 1996 Indenture. All of the Companys debt is unsecured. No conditions exist under long-term debt agreements which could restrict the Companys ability to pay dividends. As of December31, 2009, the Company had short-term credit lines and other credit facilities, with renewal terms at various dates during 2010, with various financial institutions aggregating $525 million of which Energen had available $230 million, Alagasco had available $110 million and $185 million was available to either Company for working capital needs. Alagasco has been authorized by the APSC to borrow up to $200 million at any one time under short-term lines of credit. Certain of the Companys credit facilities in the aggregate amount of $190 million, including $150 million for Energen and $40 million for Alagasco, have a covenant that the ratio of consolidated debt to consolidated capitalization will not exceed 0.65:1. The following is a summary of information relating to notes payable to banks: (in thousands) December31,2009 December31,2008 Energen outstanding $- $- Alagasco outstanding - 62,000 Notes payable to banks - 62,000 Available for borrowings 525,000 428,000 Total $525,000

INCOME TAXES

INCOME TAXES
	12 Months Ended Dec. 31, 2009 USD / shares
INCOME TAXES	4. INCOME TAXES The components of Energens income taxes consisted of the following: Years ended December31, (in thousands) 2009 2008 2007 Taxes estimated to be payable currently: Federal $ 56,821 $ 1,090 $ 149,787 State 2,534 3,539 16,480 Total current 59,355 4,629 166,267 Taxes deferred: Federal 75,644 172,137 838 State 8,972 16,277 324 Total deferred 84,616 188,414 1,162 Total income tax expense from continuing operations $ 143,971 $ 193,043 $ 167,429 For the years ended December31, 2009 and 2008, Energen recorded no income tax expense related to income from discontinued operations. For the year ended December31, 2007, Energen recorded current income tax expense of $12,000 related to income from discontinued operations. The components of Alagascos income taxes consisted of the following: Years ended December31, (in thousands) 2009 2008 2007 Taxes estimated to be payable currently: Federal $ 11,035 $ (24,972 ) $ 13,604 State 61 (1,103 ) 1,811 Total current 11,096 (26,075 ) 15,415 Taxes deferred: Federal 13,631 46,869 5,510 State 2,626 4,035 711 Total deferred 16,257 50,904 6,221 Total income tax expense $ 27,353 $ 24,829 $ 21,636 Temporary differences and carryforwards which gave rise to Energens deferred tax assets and liabilities were as follows: (in thousands) December31,2009 December31,2008 Current Noncurrent Current Noncurrent Deferred tax assets: Unbilled and deferred revenue $ 11,221 $ - $ 9,574 $ - Allowance for doubtful accounts 6,459 - 4,803 - Insurance accruals 2,788 - 1,747 - Compensation accruals 7,594 - 6,952 - Inventories 1,050 - 1,142 - Other comprehensive income - 29,078 - - Gas supply adjustment related accruals 2,111 - 1,953 - State net operating losses and other carryforwards 702 2,729 842 2,777 Other 2,165 73 2,933 121 Total deferred tax assets 34,090 31,880 29,946 2,898 Valuation allowance (331 ) (2,398 ) (353 ) (2,424 ) Total deferred tax assets 33,759 29,482 29,593 474 Deferred tax liabilities: Depreciation and basis differences - 513,302 - 426,031 Pension and other costs - 19,556 - 17,102 Other comprehensive income 42,241 - 68,619 37,773 Regulatory costs 7 - 1,014 - Other 1,526 2,084 1,929 1,626 Total deferred tax liabilities 43,774 534,942 71,562 482,532 Net

EMPLOYEE BENEFIT PLANS

EMPLOYEE BENEFIT PLANS
	12 Months Ended Dec. 31, 2009 USD / shares
EMPLOYEE BENEFIT PLANS	5. EMPLOYEE BENEFIT PLANS Pension Plans: The following table sets forth the combined funded status of the defined qualified and nonqualified supplemental benefit plans and their reconciliation with the related amounts in the Companys consolidated financial statements: (in thousands) December31,2009 December31,2008 Accumulated benefit obligation $ 177,711 $ 156,304 Projected benefit obligation: Balance at beginning of period $ 190,431 $ 199,363 Service cost 7,340 8,951 Interest cost 12,064 14,751 Plan amendments - (365 ) Actuarial (gain) loss 21,524 (5,957 ) Termination benefit charge 145 - Benefits paid (17,584 ) (26,312 ) Balance at end of period $ 213,920 $ 190,431 Plan assets: Fair value of plan assets at beginning of period $ 139,274 $ 176,644 Actual return (loss) on plan assets 27,091 (38,643 ) Employer contributions 18,872 27,585 Benefits paid (17,584 ) (26,312 ) Fair value of plan assets at end of period $ 167,653 $ 139,274 Funded status of plan $ (46,267 ) $ (51,157 ) Current liabilities $ (2,223 ) $ (3,888 ) Noncurrent liabilities (44,044 ) (47,269 ) Net liability recognized $ (46,267 ) $ (51,157 ) Amounts recognized to accumulated other comprehensive income: Prior service costs, net of tax of $0.6 million and $0.7 million $ 1,139 $ 1,334 Net actuarial loss, net of tax of $15.8 million and $14.8 million 29,435 27,402 Total accumulated other comprehensive income $ 30,574 $ 28,736 Alagasco recognized a regulatory asset of $55.8 million and $54.7 million as of December31, 2009 and 2008, respectively, for the portion of the obligation to be recovered through rates in future periods. The Company anticipates required contributions of approximately $7 million during 2010 to the pension plans. The Company expects sufficient funding credits, as established under Internal Revenue Code Section430(f), exist to meet the required funding. It is not anticipated that the funded status of the pension plans will fall below statutory thresholds requiring accelerated funding or constraints on benefit levels or plan administration. No additional discretionary contributions are currently expected to be made to the pension plans by the Company during 2010. The Company expects to make benefit payments of approximately $2.2 million during 2010 to retirees with respect to the nonqualified supplemental retirement plans. Other investment assets designated for payment of the nonqualified supplemental retirement plans were as follows: December31, 2009 (in thousands) Level1 Level2 Level3 Total Insurance contracts $

COMMON STOCK PLANS

COMMON STOCK PLANS
	12 Months Ended Dec. 31, 2009 USD / shares
COMMON STOCK PLANS	6. COMMON STOCK PLANS Energen Employee Savings Plan (ESP): A majority of Company employees are eligible to participate in the ESP by electing to contribute a portion of their compensation to the ESP. The Company may match a percentage of the contributions and make these contributions in Company common stock or in funds for the purchase of Company common stock. Employees may diversify 100 percent of their ESP Company stock account into other ESP investment options. The ESP also contains employee stock ownership plan provisions. At December31, 2009, total shares reserved for issuance equaled 1,080,108. Expense associated with Company contributions to the ESP was $5,806,000, $5,559,000 and $5,237,000 for the years ended December31, 2009, 2008 and 2007, respectively. 1997 Stock Incentive Plan and 1988 Stock Option Plan: The 1997 Stock Incentive Plan and the Energen 1988 Stock Option Plan provided for the grant of incentive stock options and non-qualified stock options to officers and key employees. The 1997 Stock Incentive Plan also provided for the grant of performance share awards and restricted stock. The Company has typically funded options, restricted stock obligations and performance share obligations through original issue shares. Under the 1997 Stock Incentive Plan, 5,600,000 shares of Company common stock were reserved for issuance with 1,369,514 remaining for issuance as of December31, 2009. Under the 1988 Stock Option Plan, 1,080,000 shares of Company common stock reserved for issuance have been granted. Performance Share Awards: The Energen 1997 Stock Incentive Plan provided for the grant of performance share awards, with each unit equal to the market value of one share of common stock, to eligible employees based on predetermined Company performance criteria at the end of a four-year award period. The 1997 Stock Incentive Plan provided that payment of earned performance share awards be made in the form of Company common stock. 1997 Stock Incentive Plan performance share awards granted or modified after January1, 2006 have been valued using a Monte Carlo model. The Monte Carlo model uses historical volatility and other variables to estimate the probability of satisfying the market condition of the award. For performance share awards granted prior to January1, 2006, the Company estimated fair value based on the quoted market price of the Companys common stock and adjusted each period for the expected payout ratio. No performance share awards were granted in 2009, 2008 or 2007. A summary of performance share award activity as of December31, 2009, and transactions during the years ended December31, 2009, 2008 and 2007 are presented below: 1997StockIncentivePlan Shares Weighted AveragePrice Nonvested at December31, 2006 588,863 $40.81 Vested and paid (225,960 ) 30.53 Nonvested at December31, 2007 362,903 49.87 Vested and paid (134,220 ) 54.25 Nonvested at December31, 2008 228,683 30.80 Expired without payout (117,540 ) 18.50 Nonvested at December31, 2009 111,143 $43.81 The Company recorded ex

COMMITMENTS AND CONTINGENCIES

COMMITMENTS AND CONTINGENCIES
	12 Months Ended Dec. 31, 2009 USD / shares
COMMITMENTS AND CONTINGENCIES	7. COMMITMENTS AND CONTINGENCIES Commitments and Agreements: Certain of Alagascos long-term contracts associated with the delivery and storage of natural gas include fixed charges of approximately $204 million through September 2024. During the years ended December31, 2009, 2008 and 2007, Alagasco recognized approximately $49 million, $51 million and $48 million, respectively, of long term commitments through expense and its regulatory accounts in the accompanying financial statements. Alagasco also is committed to purchase minimum quantities of gas at market-related prices or to pay certain costs in the event the minimum quantities are not taken. These purchase commitments are approximately 107.6 Bcf through April 2015. Environmental Matters: Various environmental laws and regulations apply to the operations of Energen Resources and Alagasco. Historically, the cost of environmental compliance has not materially affected the Companys financial position, results of operations or cash flows. New regulations, enforcement policies, claims for damages or other events could result in significant unanticipated costs. Remediation of the Huntsville, Alabama manufactured gas plant site, as discussed below, may also result in unanticipated costs. A discussion of certain litigation in the state of Louisiana related to the restoration of oilfield properties is included below under Legal Matters. Alagasco is in the chain of title of nine former manufactured gas plant sites (four of which it still owns), and five manufactured gas distribution sites (one of which it still owns). Subject to the following paragraph discussing the Huntsville, Alabama manufactured gas plant site, an investigation of the sites does not indicate the present need for remediation activities and management expects that, should remediation of any such sites be required in the future, Alagascos share, if any, of such costs will not materially affect the financial position of Alagasco. In June 2009, Alagasco received a General Notice Letter from the United States Environmental Protection Agency (EPA) identifying Alagasco as a responsible party for a former manufactured gas plant (MGP) site located in Huntsville, Alabama, and inviting Alagasco to enter an Administrative Settlement Agreement and Order on Consent to perform a removal action at that site. The Huntsville MGP, along with the Huntsville gas distribution system, was sold by Alagasco to the City of Huntsville in 1949. While Alagasco no longer owns the Huntsville site, the Company and the current site owner have entered into a Consent Order and agreed to develop an action plan for the site. Based on the limited information available at this time, Alagasco preliminarily estimates that it may incur costs associated with the site ranging from $3 million to $6.1 million. At the present time, the Company cannot conclude that any amount within this range is a better estimate than any other. During the year ended December31, 2009, the Company incurred costs of $0.2 million associated with the site. As of December31, 2009, the Company has accrued a contingent liability of $2.8 million in addition to the costs previously

FINANCIAL INSTRUMENTS AND RISK

FINANCIAL INSTRUMENTS AND RISK MANAGEMENT
	12 Months Ended Dec. 31, 2009 USD / shares
FINANCIAL INSTRUMENTS AND RISK MANAGEMENT	8. FINANCIAL INSTRUMENTS AND RISK MANAGEMENT Financial Instruments: The stated value of cash and cash equivalents, trade receivables (net of allowance), and short-term debt approximates fair value due to the short maturity of the instruments. The fair value of Energens long-term debt, including the current portion, with a carrying value of $561,522,000 would be $567,848,000 at December31, 2009. The fair value of Alagascos fixed-rate long-term debt, including the current portion, with a carrying value of $206,522,000 would be $199,121,000 at December31, 2009. The fair values were based on market prices of similar issues having the same remaining maturities, redemption terms and credit rating. Alagasco purchases gas as an agent for certain of its large commercial and industrial customers. Alagasco has in certain instances provided commodity-related guarantees to counterparties in order to facilitate these agency purchases. Liabilities existing for gas delivered to customers subject to these guarantees are included in the balance sheet. In the event the customer for whom the guarantee was entered fails to take delivery of the gas, Alagasco can sell such gas for the customer, with the customer liable for any resulting loss. Although the substantial majority of purchases under these guarantees are for the customers current monthly consumption and are at current market prices, in some instances, the purchases are for an extended term at a fixed price. At December31, 2009, the fixed price purchases under these guarantees had a maximum term outstanding through October 2010 with an aggregate purchase price of $4.3 million and a market value of $4.6 million. Risk Management: At December31, 2009, the counterparty agreements under which the Company had active positions did not include collateral posting requirements. Energen Resources was in a net gain position with six of its counterparties and a net loss with the remaining three at December31, 2009. The Company is at risk for economic loss based upon the creditworthiness of its counterparties. The three largest counterparties, Morgan Stanley Capital Group, Inc., Merrill Lynch Commodities, Inc. and J Aron Company, represented approximately 40 percent, 38 percent and 19 percent, respectively, of Energen Resources net gain on fair value of derivatives. The following table details the fair values of commodity contracts by business segment on the balance sheets: (in thousands) December31, 2009 OilandGas Operations NaturalGas Distribution Total Derivative assets or (liabilities) designated as hedging instruments Accounts receivable $ 148,937 $ - $ 148,937 Long-term derivative instruments 16,164 - 16,164 Total derivative assets 165,101 - 165,101 Accounts receivable (29,484 )* - (29,484 ) Accounts payable (6,352 ) - (6,352 ) Long-term asset derivative instruments (8,340 )* - (8,340 ) Long-term liability derivative instruments (41,374 ) (41,374 ) Total derivative liabilities (85,550 ) -

RECONCILIATION OF EARNINGS PER

RECONCILIATION OF EARNINGS PER SHARE
	12 Months Ended Dec. 31, 2009 USD / shares
RECONCILIATION OF EARNINGS PER SHARE	9. RECONCILIATION OF EARNINGS PER SHARE Years ended December31, (in thousands, except per share amounts) 2009 2008 2007 Net Income Shares PerShare Amount Net Income Shares PerShare Amount Net Income Shares PerShare Amount Basic EPS $ 256,325 71,667 $ 3.58 $ 321,915 71,601 $ 4.50 $ 309,233 71,592 $ 4.32 Effect of dilutive securities Performance share awards 108 106 351 Stock options 78 225 158 Non-vested restricted stock 32 98 80 Diluted EPS $ 256,325 71,885 $ 3.57 $ 321,915 72,030 $ 4.47 $ 309,233 72,181 $ 4.28 For the year ended December31, 2009, the Company had 969,487 options and 6,150 shares of non-vested restricted stock that were excluded from the computation of diluted EPS, as their effect was non-dilutive. The Company had no options or shares of non-vested restricted stock that were excluded from the computation of diluted EPS for the year ended December31, 2008. For the year ended December31, 2007, the Company had 239,545 options and no shares of non-vested restricted stock that were excluded from the computation of diluted EPS.

ASSET RETIREMENT OBLIGATIONS

ASSET RETIREMENT OBLIGATIONS
	12 Months Ended Dec. 31, 2009 USD / shares
ASSET RETIREMENT OBLIGATIONS	10. ASSET RETIREMENT OBLIGATIONS The Company recognizes a liability for the fair value of asset retirement obligations (ARO) in the period incurred. Subsequent to initial measurement, liabilities are accreted to their present value and capitalized costs are depreciated over the estimated useful life of the related assets. Upon settlement of the liability, the Company may recognize a gain or loss for differences between estimated and actual settlement costs. The ARO fair value liability is recognized on a discounted basis incorporating an estimate of performance risk specific to the Company. Revisions in estimates to the ARO result from revisions to the estimated timing or amount of the underlying cash flows. In 2009, 2008 and 2007, Energen Resources recognized amounts representing expected future costs associated with site reclamation, facilities dismantlement, and plug and abandonment of wells as follows: (in thousands) Balance of ARO as of December31, 2006 $ 53,980 Liabilities incurred 3,505 Liabilities settled (862 ) Accretion expense 3,948 Balance of ARO as of December31, 2007 60,571 Liabilities incurred 3,736 Liabilities settled (2,446 ) Accretion expense 4,290 Balance of ARO as of December31, 2008 66,151 Liabilities incurred 8,226 Liabilities settled (672 ) Revision in estimated cash flows 9,658 Accretion expense 4,935 Balance of ARO as of December31, 2009 $ 88,298 The Company recognizes conditional obligations if such obligations can be reasonably estimated and a legal requirement to perform an asset retirement activity exist. Included in the liabilities incurred for the year ended December31, 2009, is $6,590,000 related to the acquisition of certain oil properties in the Permian Basin from Range Resources Corporation (Range Resources). Alagasco recorded a conditional asset retirement obligation on a discounted basis of $17.4 million and $17 million to purge and cap its gas pipelines upon abandonment as a regulatory liability as of December31, 2009 and 2008, respectively. The costs associated with asset retirement obligations are currently either being recovered in rates or are probable of recovery in future rates. Alagasco accrues removal costs on certain gas distribution assets over the useful lives of its property, plant and equipment through depreciation expense in accordance with rates approved by the APSC. The accumulated asset removal costs of $136.8 million and $129.6 million for December31, 2009 and 2008, respectively, are included as regulatory liabilities in deferred credits and other liabilities on the consolidated balance sheets.

SUPPLEMENTAL CASH FLOW INFORMAT

SUPPLEMENTAL CASH FLOW INFORMATION
	12 Months Ended Dec. 31, 2009 USD / shares
SUPPLEMENTAL CASH FLOW INFORMATION	11. SUPPLEMENTAL CASH FLOW INFORMATION Supplemental information concerning Energens cash flow activities was as follows: Years ended December31, (in thousands) 2009 2008 2007 Interest paid, net of amount capitalized $ 37,032 $ 39,814 $ 44,368 Income taxes paid $ 48,061 $ 38,235 $ 154,187 Noncash investing activities: Accrued development and exploration costs $ 46,107 $ 70,319 $ 44,196 Capitalized depreciation $ 94 $ 98 $ 97 Capitalized asset retirement obligations costs $ 18,279 $ 6,392 $ 5,040 Allowance for funds used during construction $ 1,106 $ 700 $ 611 Noncash financing activities: Issuance of common stock for employee benefit plans $ 641 $ 8,275 $ 7,940 Treasury stock acquired in connection with tax withholdings $ 778 $ 27,345 $ 6,760 The Company recorded a non-cash adjustment for accretion expense of $4.9 million, $4.3 million and $3.9 million during 2009, 2008 and 2007, respectively. In 2009, the Company issued treasury shares for $0.3 million. Supplemental information concerning Alagascos cash flow activities was as follows: Years ended December31, (in thousands) 2009 2008 2007 Interest paid, net of amount capitalized $ 11,731 $ 12,611 $ 12,848 Income taxes paid $ 7,908 $ 3,012 $ 24,579 Interest on affiliated company debt, net $ 274 $ 179 $ 719 Noncash investing activities: Accrued property, plant and equipment costs $ 2,049 $ 2,510 $ 2,625 Capitalized depreciation $ 94 $ 98 $ 97 Capitalized asset retirement obligations costs, net $ 395 $ 2,656 $ 1,535 Allowance for funds used during construction $ 1,106 $ 700 $ 611

ACQUISITION AND DISPOSITIONS OF

ACQUISITION AND DISPOSITIONS OF OIL AND GAS PROPERTIES
	12 Months Ended Dec. 31, 2009 USD / shares
ACQUISITION AND DISPOSITIONS OF OIL AND GAS PROPERTIES	12. ACQUISITION AND DISPOSITIONS OF OIL AND GAS PROPERTIES In September 2009, Energen Resources recorded a $4.9 million pre-tax gain in other operating revenues from the sale of certain oil properties in the Permian Basin. The Company received approximately $6.5 million pre-tax in cash from the sale of this property. On June30, 2009, Energen completed the purchase of certain oil properties in the Permian Basin from Range Resources for a cash price of $182 million. This purchase had an effective date of May1, 2009. Energen acquired proved reserves of approximately 15.2million barrels of oil equivalents. Of the proved reserves acquired, an estimated 24 percent are undeveloped. Approximately 76 percent of the proved reserves are oil, 16 percent are natural gas liquids and natural gas comprises the remaining 8 percent. Energen Resources used its short-term credit facilities and internally generated cash flows to finance the acquisition. The acquisition qualifies as a business combination, and as such, the Company estimated the fair value of the assets acquired and liabilities assumed as of the June30, 2009 acquisition date, the date on which the Company obtained control of the properties. The fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date (exit price). Fair value measurements also utilize assumptions of market participants. The Company used a discounted cash flow model and made market assumptions as to future commodity prices, projections of estimated quantities of oil and natural gas reserves, expectations for timing and amount of future development and operating costs, projections of future rates of production, expected recovery rates and risk adjusted discount rates. These assumptions represent Level 3 inputs. The Company estimates the fair value of these properties to be approximately $186.5million, which the Company concludes approximates the fair value that would be paid by a typical market participant. This measurement resulted in no goodwill being recognized. The acquisition related costs have been expensed as incurred in operations and maintenance expense on the consolidated income statement. The following table summarizes the consideration paid to Range Resources and the amounts of the assets acquired and liabilities assumed recognized as of June30, 2009 (including the effects of closing adjustments). (in thousands) Consideration given to Range Resources Cash (net) $ 181,249 Recognized amounts of identifiable assets acquired and liabilities assumed Proved properties $ 182,668 Unproved leasehold properties 3,800 Accounts receivable 4,987 Inventory and other 455 Asset retirement obligation (6,590 ) Environmental liabilities (3,124 ) Accounts payable (947 ) Total identifiable net assets $ 181,249 Included in the Companys consolidated results of operations for the year ended December31, 2009, is $22.3 million of operating revenues and $8.9 million in operating income resulting

REGULATORY ASSETS AND LIABILITI

REGULATORY ASSETS AND LIABILITIES
	12 Months Ended Dec. 31, 2009 USD / shares
REGULATORY ASSETS AND LIABILITIES	13. REGULATORY ASSETS AND LIABILITIES The following table details regulatory assets and liabilities on the consolidated balance sheets: (in thousands) December31, 2009 December31, 2008 Current Noncurrent Current Noncurrent Regulatory assets: Pension and postretirement assets $ 132 $ 66,552 $ 132 $ 72,560 Accretion and depreciation for asset retirement obligation - 13,566 - 13,145 Gas supply adjustment 7,059 - 11,173 - Risk management activities 25,750 18,965 27,653 8,821 RSE adjustment 25 - 2,688 - Enhanced stability reserve - 2,706 - 2,917 Other 230 344 68 68 Total regulatory assets $ 33,196 $ 102,133 $ 41,714 $ 97,511 Regulatory liabilities: RSE adjustment $ 1,508 $ - $ 137 $ - Unbilled service margin 28,178 - 25,192 - Asset removal costs, net - 136,799 - 129,579 Asset retirement obligation - 17,419 - 17,024 Other 33 870 34 911 Total regulatory liabilities $ 29,719 $ 155,088 $ 25,363 $ 147,514 As described in Note 2, Regulatory Matters, Alagascos rates are established under the RSE rate-setting process and are based on average equity for the period. Alagascos rates are not adjusted to exclude a return on its investment in regulatory assets during the recovery period.

TRANSACTIONS WITH RELATED PARTI

TRANSACTIONS WITH RELATED PARTIES
	12 Months Ended Dec. 31, 2009 USD / shares
TRANSACTIONS WITH RELATED PARTIES	14. TRANSACTIONS WITH RELATED PARTIES The Company allocates certain corporate costs to Energen Resources and Alagasco based on the nature of the expense to be allocated using various factors including, but not limited to, total assets, earnings, or number of employees. The Companys cash management program seeks to minimize borrowing from outside sources through inter-company lending. Under this program, Alagasco may borrow from but does not lend to affiliates. Alagasco had net payables to affiliates of $24,962,000 and $21,582,000 at December31, 2009 and 2008, respectively. Interest income and expense between affiliates is calculated monthly based on the market weighted average interest rate. Alagasco had $0.3 million, $0.2 million and $0.7 million in affiliated company interest expense during the years ended December31, 2009, 2008 and 2007. The weighted average interest rate during 2009 and 2008 was 1.02 percent and 2.82 percent, respectively.

RECENTLY ISSUED ACCOUNTING STAN

RECENTLY ISSUED ACCOUNTING STANDARDS
	12 Months Ended Dec. 31, 2009 USD / shares
RECENTLY ISSUED ACCOUNTING STANDARDS	15. RECENTLY ISSUED ACCOUNTING STANDARDS As of January1, 2008, the Company adopted new accounting guidance on fair value measurements for financial assets and liabilities. This new guidance defines fair value, establishes criteria to be considered when measuring fair value and expands disclosures about fair value measurements. As of January1, 2009, the Company adopted the guidance related to non-financial assets and liabilities with no impact to the Companys consolidated financial statements or the results of operations. On January1, 2009, the Company adopted new accounting guidance which establishes accounting and reporting standards for ownership interests in subsidiaries held by parties other than the parent, the amount of consolidated net income attributable to the parent and to the noncontrolling interest, changes in a parents ownership interest, and the valuation of retained noncontrolling equity investments when a subsidiary is deconsolidated. This standard also establishes disclosure requirements that clearly identify and distinguish between the interests of the parent and the interests of the noncontrolling owners. This standard did not have an effect on the consolidated financial statements or the results of operations of the Company. On January1, 2009, the Company adopted revised accounting guidance for business combinations, which was issued to improve the relevance, representational faithfulness, and comparability of the information that a reporting entity provides in its financial reports about a business combination and its effects. Under this guidance, a company is required to recognize the assets acquired, liabilities assumed, contractual contingencies, and any contingent consideration measured at their fair value at the acquisition date.This guidance has been applied to an acquisition made during the second quarter of 2009 (see Note 12, Acquisition and Dispositions of Oil and Gas Properties). On January1, 2009, the Company adopted new accounting guidance expanding disclosure requirements about an entitys derivative instruments and hedging activities. The additional disclosures for derivative instruments are included in Note 8, Financial Instruments and Risk Management. On January1, 2009, the Company adopted a newly issued accounting standard which addresses whether instruments granted in share-based payment transactions are participating securities. This accounting standard requires the Company to include all unvested stock awards which contain non-forfeitable rights to dividends or dividend equivalents, whether paid or unpaid, in the number of shares outstanding in basic and diluted EPS calculations. This standard did not have a material impact on the consolidated financial statements or the results of operations of the Company. In 2009, the Company adopted a new accounting standard which provides additional guidance for estimating fair value when the volume and level of activity for the asset or liability have significantly decreased. This guidance did not have an effect on the consolidated financial statements or the results of operations of the Company. In 2009, the Company adopted an accounting s

SUMMARIZED QUARTERLY FINANCIAL

SUMMARIZED QUARTERLY FINANCIAL DATA (Unaudited)
	12 Months Ended Dec. 31, 2009 USD / shares
SUMMARIZED QUARTERLY FINANCIAL DATA (Unaudited)	16. SUMMARIZED QUARTERLY FINANCIAL DATA (Unaudited) The Companys business is seasonal in character. The following data summarizes quarterly operating results. Year ended December31, 2009 (in thousands, except per share amounts) First Second Third Fourth Operating revenues $ 484,106 $ 306,220 $ 287,289 $ 362,805 Operating income $ 161,476 $ 94,145 $ 81,849 $ 97,923 Net income $ 95,582 $ 55,001 $ 47,121 $ 58,621 Diluted earnings per average common share $ 1.33 $ 0.76 $ 0.65 $ 0.81 Basic earnings per average common share $ 1.33 $ 0.77 $ 0.66 $ 0.82 Year ended December31,2008 (in thousands, except per share amounts) First Second Third Fourth Operating revenues $ 521,646 $ 341,266 $ 330,205 $ 375,793 Operating income $ 195,339 $ 116,933 $ 130,678 $ 119,118 Net income $ 116,688 $ 66,878 $ 73,064 $ 65,285 Diluted earnings per average common share $ 1.62 $ 0.93 $ 1.01 $ 0.91 Basic earnings per average common share $ 1.63 $ 0.93 $ 1.02 $ 0.91 Alagascos business is seasonal in character and influenced by weather conditions. The following data summarizes Alagascos quarterly operating results. Year ended December31, 2009 (in thousands) First Second Third Fourth Operating revenues $ 294,986 $ 107,683 $ 68,788 $ 146,417 Operating income (loss) $ 80,839 $ 3,242 $ (15,237 ) $ 15,140 Net income (loss) $ 47,476 $ 902 $ (10,746 ) $ 7,783 Year ended December31,2008 (in thousands) First Second Third Fourth Operating revenues $ 296,751 $ 109,486 $ 82,452 $ 166,089 Operating income (loss) $ 74,488 $ (1,472 ) $ (5,891 ) $ 14,831 Net income (loss) $ 43,674 $ (3,093 ) $ (5,804 ) $ 5,384

OIL AND GAS OPERATIONS

OIL AND GAS OPERATIONS (Unaudited)
	12 Months Ended Dec. 31, 2009 USD / shares
OIL AND GAS OPERATIONS (Unaudited)	17. OIL AND GAS OPERATIONS (Unaudited) The following schedules detail historical financial data of the Companys oil and gas operations. Capitalized Costs (in thousands) December31,2009 December31,2008 Proved $3,316,939 $2,899,322 Unproved 62,189 60,343 Total capitalized costs 3,379,128 2,959,665 Accumulated depreciation, depletion, and amortization 972,676 793,465 Capitalized costs, net $2,406,452 $2,166,200 Costs Incurred: The following table sets forth costs incurred in property acquisition, exploration and development activities and includes both capitalized costs and costs charged to expense during the year: Years ended December31, (in thousands) 2009 2008 2007 Property acquisition: Proved $ 186,263 $ 864 $ 22,439 Unproved 5,100 18,132 32,187 Exploration 16,590 21,180 8,860 Development 226,841 415,682 315,852 Total costs incurred $ 434,794 $ 455,858 $ 379,338 Results of Continuing Operations From Producing Activities: The following table sets forth results of the Companys oil and gas continuing operations from producing activities: Years ended December31, (in thousands) 2009 2008 2007 Gross revenues $ 815,465 $ 906,006 $ 825,645 Production (lifting costs) 217,429 236,679 202,078 Exploration expense 10,234 9,296 2,894 Depreciation, depletion and amortization 180,752 136,404 111,567 Accretion expense 4,935 4,290 3,948 Income tax expense 143,691 194,953 177,083 Results of continuing operation from producing activities $ 258,424 $ 324,384 $ 328,075 Oil and Gas Operations: The calculation of proved reserves is made pursuant to rules prescribed by the SEC. Such rules, in part, require that proved categories of reserves be disclosed. Reserves and associated values were calculated using twelve-month average prices and current costs for the year ended December31, 2009 and year-end prices and current costs for the years ended December31, 2008 and 2007. Changes to prices and costs could have a significant effect on the disclosed amount of reserves and their associated values. In addition, the estimation of reserves inherently requires the use of geologic and engineering estimates which are subject to revision as reservoirs are produced and developed and as additional information is available. Accordingly, the amount of actual future production may vary significantly from the amount of reserves disclosed. The proved reserves are located onshore in the United States of America. Estimates of physical quantities of oil and gas proved reserves were determined by Company engineers. Ryder Scott Company, L.P. (Ryder Scott) and T. Scott Hickman and Associates, Inc. (T. Scott Hickman), independent oil and gas reservoir engineers, have audited the estimates of proved reserves of natural gas, oil and natural gas liquids that the Company has attributed to its net interests in oil and gas properties as of December31, 2009. R

INDUSTRY SEGMENT INFORMATION

INDUSTRY SEGMENT INFORMATION
	12 Months Ended Dec. 31, 2009 USD / shares
INDUSTRY SEGMENT INFORMATION	18. INDUSTRY SEGMENT INFORMATION The Company is principally engaged in two business segments: the acquisition, development, exploration and production of oil and gas in the continental United States (oil and gas operations) and the purchase, distribution and sale of natural gas in central and north Alabama (natural gas distribution). The accounting policies of the segments are the same as those described in Note 1, Summary of Significant Accounting Policies. Years ended December31,(in thousands) 2009 2008 2007 Operating revenues from continuing operations Oil and gas operations $ 822,546 $ 914,132 $ 825,592 Natural gas distribution 617,874 654,778 609,468 Total $ 1,440,420 $ 1,568,910 $ 1,435,060 Operating income (loss) from continuing operations Oil and gas operations $ 353,645 $ 482,588 $ 451,567 Natural gas distribution 83,984 81,956 72,742 Subtotal 437,629 564,544 524,309 Eliminations and corporate expenses (2,236 ) (2,476 ) (2,277 ) Total $ 435,393 $ 562,068 $ 522,032 Depreciation, depletion and amortization expense from continuing operations Oil and gas operations $ 184,089 $ 139,539 $ 114,241 Natural gas distribution 50,995 48,874 47,136 Total $ 235,084 $ 188,413 $ 161,377 Interest expense Oil and gas operations $ 25,775 $ 27,587 $ 32,673 Natural gas distribution 13,714 14,807 15,696 Subtotal 39,489 42,394 48,369 Eliminations and other (110 ) (413 ) (1,269 ) Total $ 39,379 $ 41,981 $ 47,100 Income tax expense (benefit) from continuing operations Oil and gas operations $ 117,969 $ 169,862 $ 147,418 Natural gas distribution 27,353 24,829 21,636 Subtotal 145,322 194,691 169,054 Other (1,351 ) (1,648 ) (1,625 ) Total $ 143,971 $ 193,043 $ 167,429 Capital expenditures Oil and gas operations $ 427,399 $ 449,571 $ 379,479 Natural gas distribution 77,809 63,320 58,862 Total $ 505,208 $ 512,891 $ 438,341 Identifiable assets Oil and gas operations $ 2,654,068 $ 2,650,136 $ 2,065,229 Natural gas distribution 1,084,666 1,126,587 983,258 Subtotal 3,738,734 3,776,723 3,048,487 Eliminations and other 64,384 (1,319 ) 31,166 Total $ 3,803,118 $ 3,775,404 $ 3,079,653 Property, plant and equipment, net Oil and gas operations $ 2,422,623 $ 2,181,131 $ 1,877,747 Natural gas distribution 721,846 686,517 660,496 Total $ 3,144,469 $ 2,867,648 $ 2,538,243

SCHEDULE II - VALUATION AND QUA

SCHEDULE II - VALUATION AND QUALIFYING ACCOUNTS
	12 Months Ended Dec. 31, 2009 USD / shares
SCHEDULE II - VALUATION AND QUALIFYING ACCOUNTS	SCHEDULE II - VALUATION AND QUALIFYING ACCOUNTS Energen Corporation Years ended December31, (in thousands) 2009 2008 2007 ALLOWANCE FOR DOUBTFUL ACCOUNTS Balance at beginning of year $ 12,868 $ 12,244 $ 13,961 Additions: Charged to income 11,200 6,716 5,610 Recoveries and adjustments (512 ) (245 ) (202 ) Net additions 10,688 6,471 5,408 Less uncollectible accounts written off (6,305 ) (5,847 ) (7,125 ) Balance at end of year $ 17,251 $ 12,868 $ 12,244 Alabama Gas Corporation Years ended December31, (in thousands) 2009 2008 2007 ALLOWANCE FOR DOUBTFUL ACCOUNTS Balance at beginning of year $ 12,100 $ 11,500 $ 13,200 Additions: Charged to income 11,122 6,590 5,610 Recoveries and adjustments (517 ) (199 ) (197 ) Net additions 10,605 6,391 5,413 Less uncollectible accounts written off (6,305 ) (5,791 ) (7,113 ) Balance at end of year $ 16,400 $ 12,100 $ 11,500

Document Information

Document Information
	12 Months Ended Dec. 31, 2009 USD / shares
Document Type	10-K
Amendment Flag	false
Document Period End Date	2009-12-31

Entity Information

Entity Information (USD $)
	12 Months Ended Dec. 31, 2009	Feb. 16, 2010	Jun. 30, 2009
Trading Symbol	EGN
Entity Registrant Name	ENERGEN CORP
Entity Central Index Key	0000277595
Current Fiscal Year End Date	--12-31
Entity Well-known Seasoned Issuer	Yes
Entity Current Reporting Status	Yes
Entity Voluntary Filers	No
Entity Filer Category	Large Accelerated Filer
Entity Common Stock, Shares Outstanding		71,861,637
Entity Public Float			$2,839,294,000