Exhibit 99.1
| | | |
| | NEWS RELEASE |
| | | |
100 Glenborough Drive | | Contact: Greg Panagos: 281-872-3125 |
Suite 100 | | Investor_Relations@nobleenergyinc.com |
Houston, TX 77067 | | |
NOBLE ENERGY ANNOUNCES THIRD QUARTER 2006 RESULTS
HOUSTON(November 1, 2006) — Noble Energy, Inc. (NYSE:NBL) today reported third quarter net income of $318.1 million, or $1.80 per basic share. Excluding the previously announced after tax gain on the sale of the company’s Gulf of Mexico shelf assets of approximately $88.1 million, Noble Energy’s adjusted third quarter net income (a non-GAAP measure) would have been a record $230.0 million, or $1.31 per basic share (see Gulf of Mexico Shelf Asset Sale below). Third quarter 2005 net income was $177.0 million, or $1.01 per basic share.
Discretionary cash flow (non-GAAP measure, see Schedule 3 — Determination of Discretionary Cash Flow and Reconciliation) for the third quarter was $533.5 million, a 22 percent increase over $436.6 million for the third quarter of 2005. Net cash provided by operating activities was $406.6 million. Capital expenditures for the quarter totaled $385.9 million.
Average daily production for the third quarter 2006 was 187,664 barrels of oil equivalent per day (Boepd), an increase of 11 percent compared to 168,665 Boepd for the same period last year. Sales volumes for the third quarter were 183,586 Boepd. Daily production exceeded sales volume by 4,078 Boepd because of the timing of liftings in Equatorial Guinea, the North Sea and Argentina. Production was impacted by compressor repairs following the turnaround of the Atlantic Methanol Production Company (AMPCO) methanol facility in Equatorial Guinea, which reduced natural gas sales to AMPCO by 2,385 Boepd for the quarter. The previous announced sale of the company’s Gulf of Mexico shelf assets reduced third quarter 2006 production by approximately 16,000 Boepd.
In May 2006, Noble Energy announced that its board of directors authorized the purchase of up to $500 million of the company’s common stock. Through September 30, the company repurchased 4.2 million shares of Noble Energy common stock at an average price of $46.32 per share.
Charles D. Davidson, the company’s Chairman, President and CEO, said, “Noble Energy once again reported solid operating and financial results for the quarter, reflecting our strategy of investing in a diversified portfolio of long-term, high-impact programs. Production increased over the third quarter last year, despite selling the shelf properties. Organic production increases from our three deepwater Gulf of Mexico developments and in Israel, as well as the full integration of United States Exploration, were the drivers behind our increased volumes. For the remainder of the year and continuing into 2007, we are looking forward to the results of significant exploration programs in the deepwater Gulf of Mexico and West Africa.”
For the quarter ended September 30, 2006, realized prices for liquids and natural gas were $59.32 per barrel (Bbl) and $5.30 per thousand cubic feet (Mcf), respectively. Pretax hedge losses of $43.8 million, $27.3 million after tax, lowered realized crude oil prices $7.01 per Bbl and increased realized natural gas prices approximately five cents per Mcf (see Schedule 8 — Pretax Cash Flow Hedges Earnings Impact).
NORTH AMERICA
North America reported operating income for the third quarter of $435.4 million, which includes the pretax gain on sale of the Gulf of Mexico shelf assets of approximately $203.5 million (see Gulf of Mexico Shelf Asset Sale below). Excluding the gain on sale, North America had operating income of $231.7 million, an
increase of $78.4 million, or 51 percent, compared to operating income of $153.3 million for the third quarter last year.
Operations benefited from higher volumes and higher realized prices during the quarter. Third quarter production increased 21 percent to 119,872 Boepd from 99,440 Boepd for the same period last year. Production from Noble Energy’s Swordfish, Ticonderoga and Lorien deepwater developments, which commenced in October 2005, February 2006 and April 2006, respectively, contributed approximately 27,000 Boepd during the third quarter of 2006.
The average realized liquids price was $56.84 per Bbl compared to $49.49 per Bbl during the third quarter of 2005. The average realized natural gas price was $6.41 per Mcf compared to $6.95 per Mcf last year.
During the third quarter, the company had 27 drilling rigs running onshore (11 in the Rocky Mountains, 11 in the Mid-continent and five in the Gulf Coast) and 46 workover rigs (26 in the Rocky Mountains, 18 in the Mid-continent and two in the Gulf Coast). Noble Energy plans to drill 817 onshore wells in 2006, of which 57 are to be drilled in the Gulf Coast, 503 are planned for the Rocky Mountains and 257 for the Mid-continent. The company also plans approximately 865 refrac, trifrac and recompletion projects for 2006, most of which will be in the Wattenberg field.
During the second quarter, the company announced two deepwater discoveries, Redrock and Raton. Located within five miles of each other in Mississippi Canyon, additional appraisal work on these discoveries is planned for the fourth quarter. Reservoir simulation and development evaluations are currently underway. In October, the Raton South appraisal well, located in Mississippi Canyon 292, was spud. The Raton South appraisal well is located in water depths of 3,200 feet and has a target depth of 20,000 feet. A Redrock appraisal well is currently under consideration for 2007. Noble Energy is the operator of both Raton and Redrock with a 50 percent working interest.
INTERNATIONAL OPERATIONS
International operations reported operating income for the third quarter of $158.9 million, an increase of $0.2 million compared to $158.7 million in the third quarter last year.
International production totaled 67,793 Boepd compared to 69,225 Boepd last year. The decrease in international production was primarily attributable to compressor repairs following the turnaround and expansion project of the AMPCO methanol plant in Equatorial Guinea, which resulted in reduced natural gas sales to AMPCO of 2,385 Boepd for the quarter.
West Africa
Total operating income in Equatorial Guinea increased 10 percent to $107.2 million compared to $97.2 million last year.
Alba field condensate and natural gas sales, exclusive of the Alba Plant, LLC and methanol operations, accounted for $73.4 million, or 68 percent, of operating income from Equatorial Guinea. Alba Plant, LLC reported $30.5 million of income from liquefied petroleum gas and condensate sales, net to Noble Energy’s interest, compared to $6.6 million during the third quarter 2005. The increase in operating income and sales volumes for Alba Plant, LLC reflects the completion and ramp up to full production of the Phase 2B expansion.
Income from methanol operations decreased to $3.3 million, net to Noble Energy’s interest, compared to $16.2 million during the third quarter 2005, primarily because of reduced methanol production. The company’s share of methanol sales volumes was 18.8 million Gal. Third quarter realized methanol prices were 83 cents per gallon (Gal).
In December, Noble Energy plans to spud the first of several exploration wells on Blocks ‘O’ and ‘I’ offshore Equatorial Guinea. To carry out the upcoming multi-well exploration program on Blocks ‘O’ and
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‘I,’ the company has contracted a drillship through 2007. In addition, evaluation work is underway on Block PH-77 offshore Cameroon, with the intent of identifying possible drilling locations for 2007.
North Sea
In the North Sea, operating income for the third quarter of 2006 was $15.7 million compared to $24.0 million last year. The decrease resulted primarily from lower crude oil sales due to natural field decline and the timing of liftings. In the U.K. sector of the North Sea, the Dumbarton development is expected to commence production by the first quarter of 2007, with net sales volumes averaging 9,000 Boepd during 2007.
Israel
Third quarter operating income in Israel was $24.8 million compared to $14.4 million for the same period in 2005. Natural gas production, net to Noble Energy, was the highest since sales commenced in Israel in early 2004, and averaged 116.7 MMcfpd for the third quarter 2006 compared to 81.9 MMcfpd for the same period last year. The increased natural gas production reflects the conversion to natural gas of the Reading power plant in Tel Aviv and the Eshkol power plant’s natural gas turbine running as a combined-cycle base load unit. Increased seasonal demand also contributed to improved natural gas sales. The average realized price during the third quarter was 11 percent above the third quarter 2005, primarily due to a revised natural gas sales contract.
Argentina, China, Ecuador and Suriname
Argentina, China, Ecuador and Suriname combined recorded third quarter 2006 operating income of $11.2 million compared to $23.1 million for third quarter last year.
In China, third quarter operating income was $16.2 million. In Argentina, third quarter operating income was $1.6 million.
The Machala power plant reported an operating loss of $1.6 million for the third quarter, which includes a $6.9 million reserve for past due receivables. For the quarter, 182,806 megawatt-hours were produced at an average sales price of 8.9 cents per kilowatt-hour.
Gulf of Mexico Shelf Asset Sale
On July 14, 2006, the company closed its Gulf of Mexico shelf asset sale to Coldren Resources LP. During the third quarter, the company recognized a pretax gain on sale of $203.5 million, $88.1 million after tax, which includes the sale to Coldren Resources and sales that have closed with preferential purchase right holders. Adjusting for the after tax gain on sale, Noble Energy’s third quarter net income would have been $230.0 million, or $1.31 per basic share. This adjusted net income amount should not be considered a substitute for net income as reported in accordance with GAAP. Noble Energy is providing adjusted net income for comparison purposes to prior periods and to earnings forecasts prepared by analysts and other third parties. Management believes and certain investors may find that adjusted net income is beneficial in evaluating Noble Energy’s financial performance. As of September 30, 2006, $10 million in preferential purchase rights remained to be closed.
Third quarter 2006 net income excluded pretax hedge related losses of $10.1 million ($6.3 million after tax) for hedges settled during the third quarter. These losses were recognized during the second quarter 2006 in connection with the Gulf of Mexico shelf asset sale (see Schedule 8 — Pretax Cash Flow Hedges Earnings Impact).
Noble Energy is one of the nation’s leading independent energy companies and operates throughout major basins in the United States including Colorado’s Wattenberg Field, the Mid-continent region of western Oklahoma and the Texas Panhandle, the San Juan Basin in New Mexico, the Gulf Coast and the Gulf of Mexico. In addition, Noble Energy operates internationally in Argentina, China, Ecuador, the Mediterranean Sea, the North Sea, West Africa and Suriname. Noble Energy markets natural gas and crude oil through its subsidiary, Noble Energy Marketing, Inc. Visit Noble Energy online atwww.nobleenergyinc.com.
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This news release may include projections and other “forward-looking statements” within the meaning of the federal securities laws. Any such projections or statements reflect Noble Energy’s current views about future events and financial performance. No assurances can be given that such events or performance will occur as projected, and actual results may differ materially from those projected. Important factors that could cause the actual results to differ materially from those projected include, without limitation, the volatility in commodity prices for oil and gas, the presence or recoverability of estimated reserves, the ability to replace reserves, environmental risks, drilling and operating risks, exploration and development risks, competition, government regulation or other action, the ability of management to execute its plans to meet its goals and other risks inherent in Noble Energy’s business that are detailed in its Securities and Exchange Commission filings. The United States Securities and Exchange Commission permits oil and gas companies, in their filings with the SEC, to disclose only proved reserves. We use certain terms in this press release, such as “resources,” “estimated resource range,” “resource potential” and “potential resources,” that the SEC’s guidelines strictly prohibit us from including in filings with the SEC. Investors are urged to consider closely the disclosures and risk factors in our Forms 10-K and 10-Q, available from Noble Energy’s offices or website,www.nobleenergyinc.com. These forms can also be obtained from the SEC by calling 1-800-SEC-0330.
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Schedule 1
Noble Energy, Inc. and Subsidiaries
Consolidated Statements of Operations
(In Thousands, Except Per Share Amounts)
(Unaudited)
| | | | | | | | | | | | | | | | | |
| | | Three Months Ended | | Nine Months Ended |
| | | September 30, | | September 30, |
| | | 2006 | | 2005 | | 2006 | | 2005 |
| | | |
Revenues | | | | | | | | | | | | | | | | |
| Oil and gas sales | | $ | 683,544 | | | $ | 581,585 | | | $ | 2,044,656 | | | $ | 1,340,763 | |
| Income from equity method investees | | | 33,810 | | | | 22,829 | | | | 108,901 | | | | 61,267 | |
| Other revenues | | | 23,965 | | | | 27,674 | | | | 72,339 | | | | 83,713 | |
| | | |
| Total Revenues | | | 741,319 | | | | 632,088 | | | | 2,225,896 | | | | 1,485,743 | |
| | | |
| | | | | | | | | | | | | | | | | |
Costs and Expenses | | | | | | | | | | | | | | | | |
| Lease operating costs | | | 76,928 | | | | 63,433 | | | | 238,307 | | | | 146,673 | |
| Production and ad valorem taxes | | | 30,697 | | | | 24,304 | | | | 83,663 | | | | 51,125 | |
| Transportation costs | | | 4,531 | | | | 1,871 | | | | 18,463 | | | | 12,091 | |
| Exploration costs | | | 30,904 | | | | 77,253 | | | | 92,327 | | | | 126,508 | |
| Depreciation, depletion and amortization | | | 165,765 | | | | 111,653 | | | | 458,878 | | | | 277,829 | |
| General and administrative | | | 40,657 | | | | 29,346 | | | | 113,716 | | | | 69,326 | |
| Accretion of discount on asset retirement obligations | | | 2,426 | | | | 2,928 | | | | 8,405 | | | | 8,137 | |
| Interest, net of amount capitalized | | | 28,556 | | | | 29,045 | | | | 95,642 | | | | 59,030 | |
| (Gain) loss on derivative instruments | | | (6,315 | ) | | | (259 | ) | | | 389,723 | | | | 2,121 | |
| (Gain) loss on sale of assets | | | (200,676 | ) | | | (1,234 | ) | | | (211,691 | ) | | | (5,415 | ) |
| Other expense (income), net | | | 22,880 | | | | 52,612 | | | | 89,008 | | | | 98,295 | |
| | | |
| Total Costs and Expenses | | | 196,353 | | | | 390,952 | | | | 1,376,441 | | | | 845,720 | |
| | | |
| | | | | | | | | | | | | | | | | |
| Income Before Taxes | | | 544,966 | | | | 241,136 | | | | 849,455 | | | | 640,023 | |
| Income Tax Provision | | | 226,902 | | | | 64,180 | | | | 336,009 | | | | 216,222 | |
| | | |
Net Income | | $ | 318,064 | | | $ | 176,956 | | | $ | 513,446 | | | $ | 423,801 | |
| | | |
| | | | | | | | | | | | | | | | | |
Earnings Per Share | | | | | | | | | | | | | | | | |
| Basic | | $ | 1.80 | | | $ | 1.01 | | | $ | 2.91 | | | $ | 2.89 | |
| Diluted | | | 1.75 | | | | 0.99 | | | | 2.85 | | | | 2.84 | |
| | | | | | | | | | | | | | | | | |
| Weighted average number of shares outstanding | | | | | | | | | | | | | | | | |
| Basic | | | 176,218 | | | | 174,703 | | | | 176,505 | | | | 146,612 | |
| Diluted | | | 181,077 | | | | 178,747 | | | | 180,158 | | | | 149,164 | |
Schedule 2
Noble Energy, Inc. and Subsidiaries
Consolidated Balance Sheets
(In thousands, Except Share Amounts)
| | | | | | | | | |
| | | (Unaudited) | | |
| | | September 30, | | December 31, |
| | | 2006 | | 2005 |
| | | |
ASSETS
|
Current Assets | | | | | | | | |
| Cash and cash equivalents | | $ | 89,803 | | | $ | 110,321 | |
| Accounts receivable — trade, net | | | 605,380 | | | | 566,206 | |
| Probable insurance claims | | | 101,018 | | | | 142,311 | |
| Deferred income taxes | | | 143,510 | | | | 237,045 | |
| Other current assets | | | 116,584 | | | | 119,628 | |
| | | |
| Total current assets | | | 1,056,295 | | | | 1,175,511 | |
| Property, plant and equipment | | | | | | | | |
| Oil and gas properties (successful efforts method of accounting) | | | 8,507,211 | | | | 8,411,426 | |
| Other property, plant and equipment | | | 77,610 | | | | 69,869 | |
| | | |
| | | | 8,584,821 | | | | 8,481,295 | |
| Accumulated depreciation, depletion and amortization | | | (1,608,262 | ) | | | (2,282,379 | ) |
| | | |
| Total property, plant and equipment, net | | | 6,976,559 | | | | 6,198,916 | |
| Other noncurrent assets | | | 580,153 | | | | 640,738 | |
| Goodwill | | | 783,208 | | | | 862,868 | |
| | | |
| Total Assets | | $ | 9,396,215 | | | $ | 8,878,033 | |
| | | |
| | |
LIABILITIES AND SHAREHOLDERS’ EQUITY
|
Current Liabilities | | | | | | | | |
| Accounts payable — trade | | $ | 493,517 | | | $ | 519,971 | |
| Derivative instruments | | | 263,447 | | | | 445,939 | |
| Income taxes | | | 73,936 | | | | 65,136 | |
| Asset retirement obligations | | | 93,619 | | | | 60,331 | |
| Other current liabilities | | | 235,306 | | | | 148,768 | |
| | | |
| Total current liabilities | | | 1,159,825 | | | | 1,240,145 | |
| Deferred income taxes | | | 1,706,728 | | | | 1,201,191 | |
| Asset retirement obligations | | | 130,639 | | | | 278,540 | |
| Derivative instruments | | | 422,384 | | | | 757,509 | |
| Other noncurrent liabilities | | | 271,861 | | | | 279,971 | |
| Long-term debt | | | 1,620,741 | | | | 2,030,533 | |
| | | |
| Total Liabilities | | | 5,312,178 | | | | 5,787,889 | |
| | | |
| | |
Commitments and Contingencies | | | | | | | | |
| | |
Shareholders’ Equity | | | | | | | | |
| Preferred stock — par value $1.00; 4,000,000 shares authorized, none issued | | | — | | | | — | |
| Common stock — par value $3.33 1/3; 250,000,000 shares authorized; 187,773,262 and 184,893,510 shares issued, respectively | | | 625,910 | | | | 616,311 | |
| Capital in excess of par value | | | 2,016,619 | | | | 1,945,239 | |
| Deferred compensation | | | — | | | | (5,288 | ) |
| Accumulated other comprehensive loss | | | (184,916 | ) | | | (783,499 | ) |
| Treasury stock, at cost: 12,707,784 and 9,268,932 shares, respectively | | | (317,103 | ) | | | (148,476 | ) |
| Retained earnings | | | 1,943,527 | | | | 1,465,857 | |
| | | |
| Total Shareholders’ Equity | | | 4,084,037 | | | | 3,090,144 | |
| | | |
| Total Liabilities and Shareholders’ Equity | | $ | 9,396,215 | | | $ | 8,878,033 | |
| | | |
Schedule 3
Noble Energy, Inc. and Subsidiaries
Discretionary Cash Flow and Reconciliation to Operating Cash Flow
(In Thousands)
(Unaudited)
| | | | | | | | | | | | | | | | | |
| | | Three Months Ended | | Nine Months Ended |
| | | September 30, | | September 30, |
| | | 2006 | | 2005 | | 2006 | | 2005 |
| | | |
| Net income | | $ | 318,064 | | | $ | 176,956 | | | $ | 513,446 | | | $ | 423,801 | |
| Adjustments to reconcile net income to discretionary cash flow: | | | | | | | | | | | | | | | | |
| Depreciation, depletion and amortization — oil and gas production | | | 165,765 | | | | 111,653 | | | | 458,878 | | | | 277,829 | |
| Depreciation, depletion and amortization — electricity generation | | | 3,775 | | | | 4,486 | | | | 11,842 | | | | 12,395 | |
| Impairment of operating assets | | | — | | | | 5,198 | | | | 6,359 | | | | 5,198 | |
| Exploration costs | | | 30,904 | | | | 77,253 | | | | 92,327 | | | | 126,508 | |
| Interest capitalized | | | (1,174 | ) | | | (2,393 | ) | | | (3,430 | ) | | | (7,296 | ) |
| Income from equity method investments | | | (33,810 | ) | | | (22,829 | ) | | | (108,901 | ) | | | (61,267 | ) |
| Distributions and dividends from equity method investees | | | 39,001 | | | | 16,856 | | | | 134,521 | | | | 46,556 | |
| Deferred compensation adjustment | | | 933 | | | | 21,429 | | | | 15,673 | | | | 31,307 | |
| Deferred income taxes | | | 99,650 | | | | 25,126 | | | | 146,709 | | | | 100,433 | |
| Accretion of discount on asset retirement obligations | | | 2,426 | | | | 2,928 | | | | 8,405 | | | | 8,137 | |
| Allowance for doubtful accounts | | | 6,949 | | | | 6,100 | | | | 10,564 | | | | 7,350 | |
| Stock-based compensation expense | | | 2,997 | | | | 1,406 | | | | 9,320 | | | | 2,742 | |
| (Gain) loss on derivative instruments | | | (17,461 | ) | | | (522 | ) | | | 430,328 | | | | 2,121 | |
| Gain on sale of Gulf of Mexico shelf assets | | | (88,148 | ) | | | — | | | | (88,148 | ) | | | — | |
| Other, net | | | 3,600 | | | | 12,906 | | | | 5,079 | | | | 7,258 | |
| | | |
Discretionary Cash Flow [1] | | | 533,471 | | | | 436,553 | | | | 1,642,972 | | | | 983,072 | |
| | | |
| | | | | | | | | | | | | | | | | |
Reconciliation to Operating Cash Flows: | | | | | | | | | | | | | | | | |
| Net changes in working capital | | | 66,204 | | | | 43,929 | | | | 10,194 | | | | 5,270 | |
| Cash exploration costs | | | (16,665 | ) | | | (14,865 | ) | | | (52,983 | ) | | | (36,248 | ) |
| Capitalized interest | | | 1,174 | | | | 2,393 | | | | 3,430 | | | | 7,296 | |
| Distributions from equity method investees | | | (39,001 | ) | | | (1,556 | ) | | | (116,521 | ) | | | (3,581 | ) |
| Gain on disposal of assets | | | (112,528 | ) | | | (1,234 | ) | | | (123,543 | ) | | | (5,415 | ) |
| Other adjustments to reconcile discretionary cash flow to operating cash flows | | | (26,082 | ) | | | 15,080 | | | | (22,736 | ) | | | 16,447 | |
| | | |
Net Cash Provided by Operating Activities | | $ | 406,573 | | | $ | 480,300 | | | $ | 1,340,813 | | | $ | 966,841 | |
| | | |
| | |
| [1] | | The table above reconciles discretionary cash flow to net cash provided by operating activities. While discretionary cash flow is not a GAAP measure of financial performance, management believes it is a good tool for internal use and the investment community in evaluating the Company’s overall financial performance. Among management, professional research analysts, portfolio managers and investors following the oil and gas industry, discretionary cash flow is broadly used as an indicator of a company’s ability to fund exploration and production activities and meet financial obligations. Discretionary cash flow is also commonly used as a basis to value and compare companies in the oil and gas industry. |
Schedule 4
Noble Energy, Inc
Income Before Income Taxes
(Dollars in thousands, except realized prices)
(Unaudited)
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | Three Months Ended 9/30/06 | | | | | | | | |
| |
| | | | | | | North | | West | | North | | | | | | Other | | Corporate |
| | | Consolidated | | America | | Africa | | Sea | | Israel | | International[1] | | & Other[2] |
| | | |
Revenues | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Oil sales | | $ | 392,699 | | | $ | 252,019 | | | $ | 84,048 | | | $ | 20,869 | | | $ | — | | | $ | 35,763 | | | $ | — | |
| Gas sales | | | 290,845 | | | | 253,703 | | | | 1,450 | [3] | | | 5,213 | | | | 30,451 | | | | 28 | | | | — | |
| Equity investee liquids sales | | | — | | | | — | | | | 40,164 | | | | — | | | | — | | | | — | | | | (40,164 | ) |
| Equity investee methanol sales | | | — | | | | — | | | | 15,654 | | | | — | | | | — | | | | — | | | | (15,654 | ) |
| Gathering, marketing and processing | | | 7,724 | | | | — | | | | — | | | | — | | | | — | | | | — | | | | 7,724 | |
| Electricity sales | | | 16,241 | | | | — | | | | — | | | | — | | | | — | | | | 16,241 | | | | — | |
| Income from equity method investments | | | 33,810 | | | | — | | | | — | | | | — | | | | — | | | | — | | | | 33,810 | |
| | | |
| Total Revenues | | | 741,319 | | | | 505,722 | | | | 141,316 | | | | 26,082 | | | | 30,451 | | | | 52,032 | | | | (14,284 | ) |
| |
Costs and expenses | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Oil and gas operating costs | | | 66,431 | | | | 50,753 | | | | 6,310 | | | | 3,355 | | | | 2,134 | | | | 3,817 | | | | 62 | |
| Workover and repair expense | | | 10,497 | | | | 10,453 | [7] | | | — | | | | — | | | | — | | | | 44 | | | | — | |
| Production and ad valorem taxes | | | 30,697 | | | | 22,636 | | | | — | | | | — | | | | — | | | | 7,942 | | | | 119 | |
| Transportation | | | 4,531 | | | | 3,358 | | | | — | | | | 952 | | | | — | | | | 221 | | | | — | |
| Oil and gas exploration | | | 30,904 | | | | 23,366 | | | | 706 | | | | 1,395 | | | | 82 | | | | 2,900 | | | | 2,455 | |
| Gathering, marketing and processing | | | 4,204 | | | | — | | | | — | | | | — | | | | — | | | | — | | | | 4,204 | |
| Equity investee liquids expense | | | — | | | | — | | | | 9,655 | | | | — | | | | — | | | | — | | | | (9,655 | ) |
| Equity investee methanol expense | | | — | | | | — | | | | 12,352 | | | | — | | | | — | | | | — | | | | (12,352 | ) |
| Electricity generation | | | 17,876 | | | | — | | | | — | | | | — | | | | — | | | | 17,876 | | | | — | |
| DD&A | | | 165,765 | | | | 146,010 | | | | 5,353 | | | | 2,603 | | | | 4,115 | | | | 5,921 | | | | 1,763 | |
| Impairment of operating assets | | | — | | | | — | | | | — | | | | — | | | | — | | | | — | | | | — | |
| General and administrative | | | 40,657 | | | | 16,013 | | | | — | | | | 774 | | | | 19 | | | | 2,000 | | | | 21,851 | |
| Accretion expense | | | 2,426 | | | | 1,937 | | | | 26 | | | | 290 | | | | 119 | | | | 54 | | | | — | |
| Interest expense | | | 28,556 | | | | — | | | | — | | | | — | | | | — | | | | — | | | | 28,556 | |
| Deferred compensation | | | 933 | | | | — | | | | — | | | | — | | | | — | | | | — | | | | 933 | |
| (Gain) loss on derivative instruments | | | (6,315 | ) | | | (6,315 | ) | | | — | | | | — | | | | — | | | | — | | | | — | |
| Loss on involuntary conversion | | | — | | | | — | | | | — | | | | — | | | | — | | | | — | | | | — | |
| Gain on sale of assets | | | (200,676 | ) | | | (200,676 | ) | | | — | | | | — | | | | — | | | | — | | | | — | |
| Other expense (income), net | | | (133 | ) | | | 2,755 | | | | (292 | ) | | | 1,007 | | | | (803 | ) | | | 35 | | | | (2,835 | ) |
| | | |
| Total Costs and Expenses | | | 196,353 | | | | 70,290 | | | | 34,110 | | | | 10,376 | | | | 5,666 | | | | 40,810 | | | | 35,101 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | |
Operating Income (Loss) | | $ | 544,966 | | | $ | 435,432 | | | $ | 107,206 | | | $ | 15,706 | | | $ | 24,785 | | | $ | 11,222 | | | $ | (49,385 | ) |
| | | |
| |
Key Statistics | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Sales Volumes | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | |
| Liquids (Bopd) | | | 71,959 | | | | 48,193 | | | | 13,649 | | | | 3,292 | | | | — | | | | 6,825 | | | | — | |
| Natural Gas (Mcfpd) | | | 616,170 | | | | 430,072 | | | | 40,498 | [3] | | | 8,553 | | | | 116,718 | | | | 20,329 | [6] | | | — | |
| Equity Investee Liquids (Bopd) | | | 8,932 | | | | — | | | | 8,932 | [4] | | | — | | | | — | | | | — | | | | — | |
| Equity Investee Methanol (Mgal) | | | 18,769 | | | | — | | | | 18,769 | | | | — | | | | — | | | | — | | | | — | |
| | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Production Volumes | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | |
| Liquids (Bopd) | | | 76,975 | | | | 48,193 | | | | 17,324 | | | | 3,675 | | | | — | | | | 7,783 | | | | — | |
| Natural Gas (Mcfpd) | | | 616,170 | | | | 430,072 | | | | 40,498 | | | | 8,553 | | | | 116,718 | | | | 20,329 | | | | — | |
| Equity Investee Liquids (Bopd) | | | 7,994 | | | | — | | | | 7,994 | [5] | | | — | | | | — | | | | — | | | | — | |
| | | |
Total Production Boepd[8] | | | 187,664 | | | | 119,872 | | | | 32,068 | | | | 5,101 | | | | 19,453 | | | | 11,171 | | | | — | |
| | | |
| |
Average Realized Price | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | |
| Liquids | | $ | 59.32 | | | $ | 56.84 | | | $ | 66.93 | | | $ | 68.90 | | | $ | — | | | $ | 56.96 | | | $ | — | |
| Natural Gas | | $ | 5.30 | | | $ | 6.41 | | | $ | 0.39 | | | $ | 6.62 | | | $ | 2.84 | | | $ | 1.51 | | | $ | — | |
| Equity Investee Liquids | | $ | 48.88 | | | $ | — | | | $ | 48.88 | | | $ | — | | | $ | — | | | $ | — | | | $ | — | |
| Equity Investee Methanol | | $ | 0.83 | | | $ | — | | | $ | 0.83 | | | $ | — | | | $ | — | | | $ | — | | | $ | — | |
| | | |
| | |
| [1] | | Other international includes operations in Argentina, China, Ecuador and Suriname. |
| |
| [2] | | Corporate and Other includes corporate overhead, intercompany eliminations and marketing. |
| |
| [3] | | Natural gas in Equatorial Guinea is under contract for $0.25 per MMBTU through 2026 to a methanol plant and an LPG plant. Both of these plants are owned by affiliated entities accounted for under the equity method of accounting. Beginning in 2006, the price on an Mcf basis has been adjusted to reflect the Btu content. |
| |
| [4] | | Equity Investee LPG volumes include condensate and natural gas liquids of 1,975 Bpd and 6,957 Bpd, respectively. These volumes are included in Equatorial Guinea production and LPG sales revenue. |
| |
| [5] | | Equity Investee LPG volumes include condensate and natural gas liquids of 1,811 Bpd and 6,183 Bpd, respectively. These volumes are included in Equatorial Guinea production and LPG sales revenue. |
| |
| [6] | | Ecuador natural gas volumes are included in Other International and Consolidated production, but are not included in natural gas sales revenue for either. Because the gas-to-power project in Ecuador is 100 percent owned by Noble Energy, intercompany natural gas sales are eliminated for accounting purposes. |
| |
| [7] | | Includes approximately $4.2 million of hurricane related repair expense. |
| |
| [8] | | Barrels of oil equivalent for natural gas is calculated at a 6 to 1 ratio. |
Schedule 5
Noble Energy, Inc
Income Before Income Taxes
(Dollars in thousands, except realized prices)
(Unaudited)
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | Three Months Ended 9/30/05
| | | | | | | | | | |
| | | | | | | North | | West | | North | | | | | | Other | | Corporate |
| | | Consolidated | | America | | Africa | | Sea | | Israel | | Int’l [1] | | & Other [2] |
| | | |
Revenues | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Oil sales | | $ | 290,642 | | | $ | 138,756 | | | $ | 89,188 | | | $ | 28,550 | | | $ | — | | | $ | 34,148 | | | | — | |
| Gas sales | | | 290,943 | | | | 264,521 | | | | 2,307 | [3] | | | 4,712 | | | | 19,377 | | | | 26 | | | | — | |
| Equity investee liquids sales | | | — | | | | — | | | | 14,571 | | | | — | | | | — | | | | — | | | | (14,571 | ) |
| Equity investee methanol sales | | | — | | | | — | | | | 34,745 | | | | — | | | | — | | | | — | | | | (34,745 | ) |
| Gathering, marketing and processing | | | 8,831 | | | | — | | | | — | | | | — | | | | — | | | | — | | | | 8,831 | |
| Electricity sales | | | 18,843 | | | | — | | | | — | | | | — | | | | — | | | | 18,843 | | | | — | |
| Income from equity method investments | | | 22,829 | | | | — | | | | — | | | | — | | | | — | | | | — | | | | 22,829 | |
| | | |
| Total Revenues | | | 632,088 | | | | 403,277 | | | | 140,811 | | | | 33,262 | | | | 19,377 | | | | 53,017 | | | | (17,656 | ) |
| | |
Costs and expenses | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Oil and gas operating costs | | | 60,091 | | | | 42,717 | | | | 8,758 | | | | 2,636 | | | | 2,124 | | | | 3,671 | | | | 185 | |
| Workover and repair expense | | | 3,342 | | | | 3,105 | | | | — | | | | 237 | | | | — | | | | — | | | | — | |
| Production and ad valorem taxes | | | 24,304 | | | | 22,316 | | | | — | | | | — | | | | — | | | | 1,881 | | | | 107 | |
| Transportation | | | 1,871 | | | | (13 | ) | | | — | | | | 1,630 | | | | — | | | | 254 | | | | — | |
| Oil and gas exploration | | | 77,253 | | | | 73,129 | | | | 427 | | | | 1,440 | | | | 13 | | | | 124 | | | | 2,120 | |
| Gathering, marketing and processing | | | 5,856 | | | | — | | | | — | | | | — | | | | — | | | | — | | | | 5,856 | |
| Equity investee liquids expense | | | — | | | | — | | | | 7,967 | | | | — | | | | — | | | | — | | | | (7,967 | ) |
| Equity investee methanol expense | | | — | | | | — | | | | 18,520 | | | | — | | | | — | | | | — | | | | (18,520 | ) |
| Electricity generation | | | 16,746 | | | | — | | | | — | | | | — | | | | — | | | | 16,746 | | | | — | |
| DD&A | | | 111,653 | | | | 89,623 | | | | 8,127 | | | | 2,548 | | | | 3,201 | | | | 6,409 | | | | 1,745 | |
| Impairment of operating assets | | | 5,198 | | | | 5,198 | | | | — | | | | — | | | | — | | | | — | | | | — | |
| General and administrative | | | 29,346 | | | | 9,968 | | | | 104 | | | | 809 | | | | 12 | | | | 1,890 | | | | 16,563 | |
| Accretion expense | | | 2,928 | | | | 2,544 | | | | 10 | | | | 285 | | | | 55 | | | | 34 | | | | — | |
| Interest expense | | | 29,045 | | | | — | | | | — | | | | — | | | | — | | | | — | | | | 29,045 | |
| Deferred compensation | | | 21,429 | | | | — | | | | — | | | | — | | | | — | | | | — | | | | 21,429 | |
| (Gain) loss on derivative instruments | | | (259 | ) | | | (259 | ) | | | — | | | | — | | | | — | | | | — | | | | — | |
| Loss on involuntary conversion | | | 1,000 | | | | 1,000 | | | | — | | | | — | | | | — | | | | — | | | | — | |
| Gain on sale of assets | | | (1,234 | ) | | | (1,234 | ) | | | — | | | | — | | | | — | | | | — | | | | — | |
| Other expense (income), net | | | 2,383 | | | | 1,930 | | | | (316 | ) | | | (319 | ) | | | (447 | ) | | | (1,075 | ) | | | 2,610 | |
| | | |
| Total Costs and Expenses | | | 390,952 | | | | 250,024 | | | | 43,597 | | | | 9,266 | | | | 4,958 | | | | 29,934 | | | | 53,173 | |
| | |
| | | |
Operating Income (Loss) | | $ | 241,136 | | | $ | 153,253 | | | $ | 97,214 | | | $ | 23,996 | | | $ | 14,419 | | | $ | 23,083 | | | $ | (70,829 | ) |
| | | |
| | |
Key Statistics | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Sales Volumes | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | |
| Liquids (Bopd) | | | 65,869 | | | | 30,475 | | | | 22,023 | | | | 5,198 | | | | — | | | | 8,173 | | | | — | |
| Natural Gas (Mcfpd) | | | 593,620 | | | | 413,789 | | | | 63,193 | [3] | | | 9,970 | | | | 81,942 | | | | 24,726 | [5] | | | — | |
| Equity Investee Liquids (Bopd) | | | 3,859 | | | | — | | | | 3,859 | [4] | | | — | | | | — | | | | — | | | | — | |
| Equity Investee Methanol (Mgal) | | | 46,133 | | | | — | | | | 46,133 | | | | — | | | | — | | | | — | | | | — | |
| | | |
| | |
Production Volumes | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | |
| Liquids (Bopd) | | | 65,869 | | | | 30,475 | | | | 22,023 | | | | 5,198 | | | | — | | | | 8,173 | | | | — | |
| Natural Gas (Mcfpd) | | | 593,620 | | | | 413,789 | | | | 63,193 | | | | 9,970 | | | | 81,942 | | | | 24,726 | | | | — | |
| Equity Investee Liquids (Bopd) | | | 3,859 | | | | — | | | | 3,859 | | | | — | | | | — | | | | — | | | | — | |
| | | |
Total Production Boepd[6] | | | 168,665 | | | | 99,440 | | | | 36,414 | | | | 6,860 | | | | 13,657 | | | | 12,294 | | | | — | |
| | | |
| | |
Average Realized Price | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | |
| Liquids | | $ | 47.96 | | | $ | 49.49 | | | $ | 44.02 | | | $ | 59.71 | | | $ | — | | | $ | 45.41 | | | $ | — | |
| Natural Gas | | $ | 5.56 | | | $ | 6.95 | | | $ | 0.40 | | | $ | 5.14 | | | $ | 2.57 | | | $ | 1.10 | | | $ | — | |
| Equity Investee Liquids | | $ | 41.04 | | | $ | — | | | $ | 41.04 | | | $ | — | | | $ | — | | | $ | — | | | $ | — | |
| Equity Investee Methanol | | $ | 0.75 | | | $ | — | | | $ | 0.75 | | | $ | — | | | $ | — | | | $ | — | | | $ | — | |
| | | |
| | |
| [1] | | Other international includes operations in Argentina, China, Ecuador and Suriname. |
| |
| [2] | | Corporate and Other includes corporate overhead, intercompany eliminations and marketing. |
| |
| [3] | | Natural gas in Equatorial Guinea is under contract for $0.25 per MMBTU through 2026 to a methanol plant and an LPG plant. Both of these plants are owned by affiliated entities accounted for under the equity method of accounting. |
| |
| [4] | | Equity Investee LPG volumes include condensate and natural gas liquids of 941 Bpd and 2,918 Bpd, respectively. These volumes are included in Equatorial Guinea production and LPG sales revenue. |
| |
| [5] | | Ecuador natural gas volumes are included in Other International and Consolidated production, but are not included in natural gas sales revenue for either. Because the gas-to-power project in Ecuador is 100 percent owned by Noble Energy, intercompany natural gas sales are eliminated for accounting purposes. |
| |
| [6] | | Barrels of oil equivalent for natural gas is calculated at a 6 to 1 ratio. |
Schedule 6
Noble Energy, Inc
Income Before Income Taxes
(Dollars in thousands, except realized prices)
(Unaudited)
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| |
| | | | | | | Nine Months Ended 9/30/06 | | | | | | | | | | |
| |
| | | | | | | North | | West | | North | | | | | | Other | | Corporate |
| | | Consolidated | | America | | Africa | | Sea | | Israel | | Int'l [1] | | & Other [2] |
| | | |
Revenues | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Oil sales | | $ | 1,126,983 | | | $ | 644,103 | | | $ | 302,284 | | | $ | 69,948 | | | $ | — | | | $ | 110,648 | | | $ | — | |
| Gas sales | | | 917,673 | | | | 825,765 | | | | 4,586 | [3] | | | 18,775 | | | | 68,441 | | | | 106 | | | | — | |
| Equity investee liquids sales | | | — | | | | — | | | | 104,720 | | | | — | | | | — | | | | — | | | | (104,720 | ) |
| Equity investee methanol sales | | | — | | | | — | | | | 70,967 | | | | — | | | | — | | | | — | | | | (70,967 | ) |
| Gathering, marketing and processing | | | 22,667 | | | | — | | | | — | | | | — | | | | — | | | | — | | | | 22,667 | |
| Electricity sales | | | 49,672 | | | | — | | | | — | | | | — | | | | — | | | | 49,672 | | | | — | |
| Income from equity method investments | | | 108,901 | | | | — | | | | — | | | | — | | | | — | | | | — | | | | 108,901 | |
| | | |
| Total Revenues | | | 2,225,896 | | | | 1,469,868 | | | | 482,557 | | | | 88,723 | | | | 68,441 | | | | 160,426 | | | | (44,119 | ) |
| |
Costs and expenses | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Oil and gas operating costs | | | 195,550 | | | | 147,357 | | | | 21,760 | | | | 7,998 | | | | 6,389 | | | | 11,623 | | | | 423 | |
| Workover and repair expense | | | 42,757 | | | | 42,628 | [7] | | | — | | | | — | | | | — | | | | 129 | | | | — | |
| Production and ad valorem taxes | | | 83,663 | | | | 66,373 | | | | — | | | | — | | | | — | | | | 16,910 | | | | 380 | |
| Transportation | | | 18,463 | | | | 14,022 | | | | — | | | | 3,843 | | | | — | | | | 598 | | | | — | |
| Oil and gas exploration | | | 92,327 | | | | 62,481 | | | | 5,339 | | | | 9,279 | | | | 143 | | | | 7,684 | | | | 7,401 | |
| Gathering, marketing and processing | | | 15,674 | | | | — | | | | — | | | | — | | | | — | | | | — | | | | 15,674 | |
| Equity investee liquids expense | | | — | | | | — | | | | 23,233 | | | | — | | | | — | | | | — | | | | (23,233 | ) |
| Equity investee methanol expense | | | — | | | | — | | | | 43,552 | | | | — | | | | — | | | | — | | | | (43,552 | ) |
| Electricity generation | | | 43,099 | | | | — | | | | — | | | | — | | | | — | | | | 43,099 | | | | — | |
| DD&A | | | 458,878 | | | | 402,033 | | | | 15,674 | | | | 5,933 | | | | 10,367 | | | | 19,445 | | | | 5,426 | |
| Impairment of operating assets | | | 6,359 | | | | 6,359 | | | | — | | | | — | | | | — | | | | — | | | | — | |
| General and administrative | | | 113,716 | | | | 44,089 | | | | 1 | | | | 2,080 | | | | 58 | | | | 2,982 | | | | 64,506 | |
| Accretion expense | | | 8,405 | | | | 6,960 | | | | 78 | | | | 868 | | | | 332 | | | | 167 | | | | — | |
| Interest expense | | | 95,642 | | | | — | | | | — | | | | — | | | | — | | | | — | | | | 95,642 | |
| Deferred compensation | | | 15,673 | | | | — | | | | — | | | | — | | | | — | | | | — | | | | 15,673 | |
| (Gain) loss on derivative instruments | | | 389,723 | | | | 389,723 | | | | — | | | | — | | | | — | | | | — | | | | — | |
| Loss on involuntary conversion | | | — | | | | — | | | | — | | | | — | | | | — | | | | — | | | | — | |
| Gain on sale of assets | | | (211,691 | ) | | | (211,691 | ) | | | — | | | | — | | | | — | | | | — | | | | — | |
| Other expense (income), net | | | 8,203 | | | | 14,878 | | | | (570 | ) | | | (528 | ) | | | (1,699 | ) | | | 1,177 | | | | (5,055 | ) |
| | | |
| Total Costs and Expenses | | | 1,376,441 | | | | 985,212 | | | | 109,067 | | | | 29,473 | | | | 15,590 | | | | 103,814 | | | | 133,285 | |
| | | |
| |
Operating Income (Loss) | | $ | 849,455 | | | $ | 484,656 | | | $ | 373,490 | | | $ | 59,250 | | | $ | 52,851 | | | $ | 56,612 | | | $ | (177,404 | ) |
| | | |
| |
Key Statistics | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Sales Volumes | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | |
| Liquids (Bopd) | | | 74,290 | | | | 45,834 | | | | 17,374 | | | | 3,619 | | | | — | | | | 7,463 | | | | — | |
| Natural Gas (Mcfpd) | | | 629,279 | | | | 461,843 | | | | 44,232 | [3] | | | 8,460 | | | | 91,656 | | | | 23,088 | [6] | | | — | |
| Equity Investee Liquids (Bopd) | | | 8,168 | | | | — | | | | 8,168 | [4] | | | — | | | | — | | | | — | | | | — | |
| Equity Investee Methanol (Mgal) | | | 85,233 | | | | — | | | | 85,233 | | | | — | | | | — | | | | — | | | | — | |
| | | |
| |
Production Volumes | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | |
| Liquids (Bopd) | | | 74,829 | | | | 45,834 | | | | 17,790 | | | | 3,867 | | | | — | | | | 7,338 | | | | — | |
| Natural Gas (Mcfpd) | | | 629,279 | | | | 461,843 | | | | 44,232 | | | | 8,460 | | | | 91,656 | | | | 23,088 | | | | — | |
| Equity Investee Liquids (Bopd) | | | 7,503 | | | | — | | | | 7,503 | [5] | | | — | | | | — | | | | — | | | | — | |
| | | |
Total Production Boepd[8] | | | 187,212 | | | | 122,808 | | | | 32,665 | | | | 5,277 | | | | 15,276 | | | | 11,186 | | | | — | |
| | | |
| |
Average Realized Price | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | |
| Liquids | | $ | 55.57 | | | $ | 51.48 | | | $ | 63.73 | | | $ | 70.79 | | | $ | — | | | $ | 54.31 | | | $ | — | |
| Natural Gas | | $ | 5.54 | | | $ | 6.55 | | | $ | 0.38 | | | $ | 8.13 | | | $ | 2.74 | | | $ | 1.20 | | | $ | — | |
| Equity Investee Liquids | | $ | 46.96 | | | $ | — | | | $ | 46.96 | | | $ | — | | | $ | — | | | $ | — | | | $ | — | |
| Equity Investee Methanol | | $ | 0.83 | | | $ | — | | | $ | 0.83 | | | $ | — | | | $ | — | | | $ | — | | | $ | — | |
| | | |
| | |
| [1] | | Other international includes operations in Argentina, China, Ecuador and Suriname. |
| |
| [2] | | Corporate and Other includes corporate overhead, intercompany eliminations and marketing. |
| |
| [3] | | Natural gas in Equatorial Guinea is under contract for $0.25 per MMBTU through 2026 to a methanol plant and an LPG plant. Both of these plants are owned by affiliated entities accounted for under the equity method of accounting. Beginning in 2006, the price on an Mcf basis has been adjusted to reflect the Btu content. |
| |
| [4] | | Equity Investee LPG sales volumes include condensate and natural gas liquids of 1,759 Bpd and 6,409 Bpd, respectively. These volumes are included in Equatorial Guinea production and LPG sales revenue. |
| |
| [5] | | Equity Investee LPG production volumes include condensate and natural gas liquids of 1,726 Bpd and 5,777 Bpd, respectively. |
| |
| [6] | | Ecuador natural gas volumes are included in Other International and Consolidated production, but are not included in natural gas sales revenue for either. Because the gas-to-power project in Ecuador is 100 percent owned by Noble Energy, intercompany natural gas sales are eliminated for accounting purposes. |
| |
| [7] | | Includes approximately $25.6 million of hurricane related repair expense. |
| |
| [8] | | Barrels of oil equivalent for natural gas is calculated at a 6 to 1 ratio. |
Schedule 7
Noble Energy, Inc
Income Before Income Taxes
(Dollars in thousands, except realized prices)
(Unaudited)
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | Nine Months Ended 9/30/05
| | | | | | | | |
| | | | | | | North | | West | | North | | | | | | Other | | Corporate |
| | | Consolidated | | America | | Africa | | Sea | | Israel | | Int’l [1] | | & Other [2] |
| | | |
Revenues | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Oil sales | | $ | 683,114 | | | $ | 297,090 | | | $ | 212,715 | | | $ | 80,097 | | | $ | — | | | $ | 93,212 | | | $ | — | |
| Gas sales | | | 657,649 | | | | 590,380 | | | | 4,109 | [3] | | | 13,723 | | | | 49,407 | | | | 30 | | | | — | |
| Equity investee liquids sales | | | — | | | | — | | | | 26,063 | | | | — | | | | — | | | | — | | | | (26,063 | ) |
| Equity investee methanol sales | | | — | | | | — | | | | 94,949 | | | | — | | | | — | | | | — | | | | (94,949 | ) |
| Gathering, marketing and processing | | | 28,735 | | | | — | | | | — | | | | — | | | | — | | | | — | | | | 28,735 | |
| Electricity sales | | | 54,978 | | | | — | | | | — | | | | — | | | | — | | | | 54,978 | | | | | |
| Income from equity method investments | | | 61,267 | | | | — | | | | — | | | | — | | | | — | | | | — | | | | 61,267 | |
| | | |
| Total Revenues | | | 1,485,743 | | | | 887,470 | | | | 337,836 | | | | 93,820 | | | | 49,407 | | | | 148,220 | | | | (31,010 | ) |
Costs and expenses | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Oil and gas operating costs | | | 138,006 | | | | 92,076 | | | | 19,565 | | | | 8,763 | | | | 6,124 | | | | 11,564 | | | | (86 | ) |
| Workover and repair expense | | | 8,667 | | | | 8,430 | | | | — | | | | 237 | | | | — | | | | — | | | | — | |
| Production and ad valorem taxes | | | 51,125 | | | | 41,346 | | | | — | | | | — | | | | — | | | | 9,371 | | | | 408 | |
| Transportation | | | 12,091 | | | | 6,706 | | | | — | | | | 4,728 | | | | — | | | | 657 | | | | — | |
| Oil and gas exploration | | | 126,508 | | | | 111,096 | | | | 2,312 | | | | 5,191 | | | | 105 | | | | 2,116 | | | | 5,688 | |
| Gathering, marketing and processing | | | 20,905 | | | | — | | | | — | | | | — | | | | — | | | | — | | | | 20,905 | |
| Equity investee liquids expense | | | — | | | | — | | | | 9,074 | | | | — | | | | — | | | | — | | | | (9,074 | ) |
| Equity investee methanol expense | | | — | | | | — | | | | 50,671 | | | | — | | | | — | | | | — | | | | (50,671 | ) |
| Electricity generation | | | 37,637 | | | | — | | | | — | | | | — | | | | — | | | | 37,637 | | | | — | |
| DD&A | | | 277,829 | | | | 216,553 | | | | 20,677 | | | | 8,241 | | | | 8,400 | | | | 19,022 | | | | 4,936 | |
| Impairment of operating assets | | | 5,198 | | | | 5,198 | | | | — | | | | — | | | | — | | | | — | | | | — | |
| General and administrative | | | 69,326 | | | | 21,248 | | | | 435 | | | | 1,737 | | | | 39 | | | | 4,483 | | | | 41,384 | |
| Accretion expense | | | 8,137 | | | | 6,994 | | | | 28 | | | | 849 | | | | 165 | | | | 101 | | | | — | |
| Interest expense | | | 59,030 | | | | — | | | | — | | | | — | | | | — | | | | — | | | | 59,030 | |
| Deferred compensation | | | 31,307 | | | | — | | | | — | | | | — | | | | — | | | | — | | | | 31,307 | |
| (Gain) loss on derivative instruments | | | 2,121 | | | | 2,121 | | | | — | | | | — | | | | — | | | | — | | | | — | |
| Loss on involuntary conversion | | | 1,000 | | | | 1,000 | | | | — | | | | — | | | | — | | | | — | | | | — | |
| Gain on sale of assets | | | (5,415 | ) | | | (5,415 | ) | | | — | | | | — | | | | — | | | | — | | | | — | |
| Other expense (income), net | | | 2,248 | | | | 6,809 | | | | (360 | ) | | | (1,119 | ) | | | (1,308 | ) | | | (950 | ) | | | (824 | ) |
| | | |
| Total Costs and Expenses | | | 845,720 | | | | 514,162 | | | | 102,402 | | | | 28,627 | | | | 13,525 | | | | 84,001 | | | | 103,003 | |
| | | |
Operating Income (Loss) | | $ | 640,023 | | | $ | 373,308 | | | $ | 235,434 | | | $ | 65,193 | | | $ | 35,882 | | | $ | 64,219 | | | $ | (134,013 | ) |
| | | |
Key Statistics | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Sales Volumes | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | |
| Liquids (Bopd) | | | 56,245 | | | | 24,617 | | | | 17,681 | | | | 5,630 | | | | — | | | | 8,317 | | | | — | |
| Natural Gas (Mcfpd) | | | 476,636 | | | | 317,976 | | | | 60,320 | [3] | | | 9,285 | | | | 67,182 | | | | 21,873 | [5] | | | — | |
| Equity Investee Liquids (Bopd) | | | 2,376 | | | | — | | | | 2,376 | [4] | | | — | | | | — | | | | — | | | | — | |
| Equity Investee Methanol (Mgal) | | | 122,256 | | | | — | | | | 122,256 | | | | — | | | | — | | | | — | | | | — | |
| | | |
Production Volumes | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Liquids (Bopd) | | | 56,245 | | | | 24,617 | | | | 17,681 | | | | 5,630 | | | | — | | | | 8,317 | | | | — | |
| Natural Gas (Mcfpd) | | | 476,636 | | | | 317,976 | | | | 60,320 | | | | 9,285 | | | | 67,182 | | | | 21,873 | | | | — | |
| Equity Investee Liquids (Bopd) | | | 2,376 | | | | — | | | | 2,376 | | | | — | | | | — | | | | — | | | | — | |
| | | |
Total Production Boepd[6] | | | 138,060 | | | | 77,613 | | | | 30,110 | | | | 7,178 | | | | 11,197 | | | | 11,963 | | | | — | |
| | | |
Average Realized Price | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | |
| Liquids | | $ | 44.49 | | | $ | 44.21 | | | $ | 44.07 | | | $ | 52.11 | | | $ | — | | | $ | 41.05 | | | $ | — | |
| Natural Gas | | $ | 5.30 | | | $ | 6.80 | | | $ | 0.25 | | | $ | 5.41 | | | $ | 2.69 | | | $ | 1.10 | | | $ | — | |
| Equity Investee Liquids | | $ | 40.18 | | | $ | — | | | $ | 40.18 | | | $ | — | | | $ | — | | | $ | — | | | $ | — | |
| Equity Investee Methanol | | $ | 0.78 | | | $ | — | | | $ | 0.78 | | | $ | — | | | $ | — | | | $ | — | | | $ | — | |
| | | |
| | |
| [1] | | Other international includes operations in Argentina, China, Ecuador and Suriname. |
| |
| [2] | | Corporate and Other includes corporate overhead, intercompany eliminations and marketing. |
| |
| [3] | | Natural gas in Equatorial Guinea is under contract for $0.25 per MMBTU through 2026 to a methanol plant and an LPG plant. Both of these plants are owned by affiliated entities accounted for under the equity method of accounting. |
| |
| [4] | | Equity Investee LPG volumes include condensate and natural gas liquids of 672 Bpd and 1,704 Bpd, respectively. These volumes are included in Equatorial Guinea production and LPG sales revenue. |
| |
| [5] | | Ecuador natural gas volumes are included in Other International and Consolidated production, but are not included in natural gas sales revenue for either. Because the gas-to-power project in Ecuador is 100 percent owned by Noble Energy, intercompany natural gas sales are eliminated for accounting purposes. |
| |
| [6] | | Barrels of oil equivalent for natural gas is calculated at a 6 to 1 ratio. |
Schedule 8
Noble Energy, Inc.
Pretax Cash Flow Hedges Earnings Impact
(Dollars in thousands)
(Unaudited)
| | | | | | | | | | | | | | | | | |
| | | Three Months Ended | | Nine Months Ended |
| | | 9/30/2006 | | 9/30/2005 | | 9/30/2006 | | 9/30/2005 |
| | | |
Reduction of oil and gas sales: | | | | | | | | | | | | | | | | |
| Cash settlement crude oil contracts | | $ | (46,386 | ) | | $ | (60,796 | ) | | $ | (159,687 | ) | | $ | (103,294 | ) |
| Cash settlement natural gas contracts | | | (7,541 | ) | | | (29,269 | ) | | | (69,477 | ) | | | (28,208 | ) |
| | | |
| Total cash settlements | | | (53,927 | ) | | | (90,065 | ) | | | (229,164 | ) | | | (131,502 | ) |
| Non-cash impact of loss associated with Gulf of Mexico shelf asset sale | | | 10,129 | | | | — | | | | 10,129 | | | | — | |
| | | |
| Net reduction of oil and gas sales | | | (43,798 | ) | | | (90,065 | ) | | | (219,035 | ) | | | (131,502 | ) |
| | | |
Gain (loss) on derivative instruments: | | | | | | | | | | | | | | | | |
| Loss associated with Gulf of Mexico shelf asset sale | | | — | | | | — | | | | (395,230 | ) | | | — | |
| Other | | | 6,315 | | | | 259 | | | | 5,507 | | | | (2,121 | ) |
| | | |
| Gain (loss) on derivative instruments | | | 6,315 | | | | 259 | | | | (389,723 | ) | | | (2,121 | ) |
| | | |
Pretax earnings decrease | | $ | (37,483 | ) | | $ | (89,806 | ) | | $ | (608,758 | ) | | $ | (133,623 | ) |
| | | |
Impact of Loss Associated with Gulf of Mexico Shelf Asset sale
(Dollars in thousands)
(Unaudited)
| | | | | |
Loss associated with Gulf of Mexico shelf asset sale (2Q 2006) | | | (398,516 | ) |
Contracts settled (3Q 2006) | | | 10,129 | |
Other changes (3Q 2006) | | | 3,286 | |
| | | | |
Unsettled loss associated with Gulf of Mexico shelf asset sale | | | (385,101 | ) |
| | | | | | | | | | | | | |
| Settlement schedule | | Crude Oil | | Natural Gas | | Total |
| | | |
| 4Q 2006 | | | — | | | | 17,237 | | | | 17,237 | |
| 1Q 2007 | | | — | | | | 51,028 | | | | 51,028 | |
| 2Q 2007 | | | — | | | | 39,589 | | | | 39,589 | |
| 3Q 2007 | | | — | | | | 42,404 | | | | 42,404 | |
| 4Q 2007 | | | — | | | | 49,402 | | | | 49,402 | |
| 1Q 2008 | | | 5,979 | | | | 54,529 | | | | 60,508 | |
| 2Q 2008 | | | 5,834 | | | | 32,191 | | | | 38,025 | |
| 3Q 2008 | | | 5,763 | | | | 34,055 | | | | 39,818 | |
| 4Q 2008 | | | 5,633 | | | | 41,457 | | | | 47,090 | |
| | | |
Remaining settlements | | | 23,209 | | | | 361,892 | | | | 385,101 | |
| | | |
Schedule 9
Noble Energy, Inc.
Ecuador Power Operations
(Dollars in thousands, except realized prices)
(Unaudited)
| | | | | | | | | | | | | | | | | |
| | | Three Months Ended | | | Nine Months Ended | |
| | | 9/30/2006 | | | 9/30/2005 | | | 9/30/2006 | | | 9/30/2005 | |
| | | |
Revenues | | | | | | | | | | | | | | | | |
| Power Sales | | $ | 14,231 | | | $ | 17,012 | | | $ | 43,447 | | | $ | 49,133 | |
| Capacity Charge | | | 2,010 | | | | 1,831 | | | | 6,225 | | | | 5,845 | |
| | | |
| Total Revenues | | | 16,241 | | | | 18,843 | | | | 49,672 | | | | 54,978 | |
| | | | | | | | | | | | | | | | | |
Costs and expenses | | | | | | | | | | | | | | | | |
| Field | | | | | | | | | | | | | | | | |
| Lease Operating | | | 756 | | | | 616 | | | | 2,119 | | | | 2,215 | |
| DD&A | | | 2,593 | | | | 3,435 | | | | 8,337 | | | | 9,230 | |
| General and administrative | | | 595 | | | | 469 | | | | 1,857 | | | | 1,539 | |
| Plant | | | | | | | | | | | | | | | | |
| Fuel & Other Operating Costs | | | 10,733 | | | | 10,024 | | | | 21,661 | | | | 17,401 | |
| DD&A | | | 1,182 | | | | 1,053 | | | | 3,505 | | | | 3,169 | |
| General and administrative | | | 2,017 | | | | 1,149 | | | | 5,620 | | | | 4,083 | |
| | | |
| Total Costs and Expenses | | | 17,876 | | | | 16,746 | | | | 43,099 | | | | 37,637 | |
Operating (Loss) Income | | $ | (1,635 | ) | | $ | 2,097 | | | $ | 6,573 | | | $ | 17,341 | |
| | | |
| Natural Gas Production (Mcfpd) | | | 20,131 | | | | 24,466 | | | | 22,764 | | | | 21,772 | |
| Average Natural Gas Price | | $ | 3.76 | | | $ | 3.93 | | | $ | 3.76 | | | $ | 3.86 | |
| | | |
| Power Production — Total MW | | | 182,806 | | | | 221,840 | | | | 603,513 | | | | 565,724 | |
| Average Power Price ($/Kwh) | | $ | 0.089 | | | $ | 0.085 | | | $ | 0.082 | | | $ | 0.097 | |
| | | |
Schedule 10
Income from Equity Method Investees
Methanol Operations
(Dollars in thousands, except realized prices)
(Unaudited) (Dollars in thousands)
| | | | | | | | | | | | | | | | | |
| | | Three Months Ended | | Nine Months Ended |
| | | 9/30/2006 | | 9/30/2005 | | 9/30/2006 | | 9/30/2005 |
| | | |
Revenues | | | | | | | | | | | | | | | | |
| Methanol sales | | $ | 15,654 | | | $ | 34,745 | | | $ | 70,967 | | | $ | 94,949 | |
| Other | | | 2,682 | | | | 1,218 | | | | 7,959 | | | | 4,614 | |
| | | |
| Total revenues | | | 18,336 | | | | 35,963 | | | | 78,926 | | | | 99,563 | |
| | | | | | | | | | | | | | | | | |
Costs and expenses | | | | | | | | | | | | | | | | |
| Cost of goods manufactured | | | 11,425 | | | | 12,182 | | | | 34,576 | | | | 34,240 | |
| DD&A | | | 2,348 | | | | 2,404 | | | | 7,075 | | | | 6,999 | |
| General and administrative | | | 381 | | | | 529 | | | | 1,403 | | | | 1,639 | |
| | | |
| Total costs and expenses | | | 14,154 | | | | 15,115 | | | | 43,054 | | | | 42,878 | |
| | | | | | | | | | | | | | | | | |
Income Tax Provision | | | 880 | | | | 4,622 | | | | 8,457 | | | | 12,406 | |
| | | | | | | | | | | | | | | | | |
| | | |
Income (Loss) from Equity Method Investees | | $ | 3,302 | | | $ | 16,226 | | | $ | 27,415 | | | $ | 44,279 | |
| | | |
| Methanol Sales (MGal) | | | 18,769 | | | | 46,133 | | | | 85,233 | | | | 122,256 | |
| Average Realized Price ($/Gal) | | $ | 0.83 | | | $ | 0.75 | | | $ | 0.83 | | | $ | 0.78 | |
Alba Plant
(Dollars in thousands, except realized prices)
(Unaudited) (Dollars in thousands)
| | | | | | | | | | | | | | | | | |
| | | Three Months Ended | | Nine Months Ended |
| | | 9/30/2006 | | 9/30/2005 | | 9/30/2006 | | 9/30/2005 |
| | | |
Revenues | | | | | | | | | | | | | | | | |
| LPG Plant Sales | | $ | 40,164 | | | $ | 14,571 | | | $ | 104,720 | | | $ | 26,063 | |
| Other | | | 310 | | | | 1 | | | | 957 | | | | 4,044 | |
| | | |
| Total Revenues | | | 40,474 | | | | 14,572 | | | | 105,677 | | | | 30,107 | |
| | | | | | | | | | | | | | | | | |
Costs and expenses | | | | | | | | | | | | | | | | |
| LPG Plant Expenses | | | 8,285 | | | | 2,723 | | | | 19,222 | | | | 5,892 | |
| DD&A | | | 1,645 | | | | 2,182 | | | | 4,933 | | | | 3,212 | |
| | | |
| Total Costs and Expenses | | | 9,930 | | | | 4,905 | | | | 24,155 | | | | 9,104 | |
| | | | | | | | | | | | | | | | | |
Income Tax Provision | | | 35 | | | | 3,063 | | | | 35 | | | | 4,014 | |
| | | | | | | | | | | | | | | | | |
| | | |
Income (Loss) from Equity Method Investees | | $30,509 | | $ | 6,604 | | | $ | 81,487 | | | $ | 16,989 | |
| | | |
| LPG Plant Sales (Bopd) | | | 8,932 | | | | 3,859 | | | | 8,168 | | | | 2,376 | |
| Average Realized Price ($/Bbl) | | $ | 48.88 | | | $ | 41.04 | | | $ | 46.96 | | | $ | 40.18 | |
