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EXHIBIT 28.1
MILLER AND LENTS, LTD. MARTIN G. MILLER (1948-1980)
MAX R. LENTS
KENNETH B. FORD
OIL AND GAS CONSULTANTS WALTER CROW
IRWIN L. LEVY
TWENTY-SEVENTH FLOOR R.G. VON TUNGELN
JAMES E. WERNER
1100 LOUISIANA WILLIAM F. NELSON
K.R. CHEATHAM
JAMES C. PEARSON
HOUSTON, TEXAS 77002-5216 J. ED SMITH
S.J. STIEBER
TELEPHONE 713 651-9455 T. LESLIE REEVES
R.W. FRAZIER
TELEFAX 713 654-9914 LARRY M. GRING
J.L. POWELL
CABLE "MILLENT" WILLIAM P. KOZA
ROBERT W. RASOR
WILLIAM K. KIBLER
KELLY P. VARNEY
CHARLES G. GUFFEY
KAREN F. LOVING
JAMES A. COLE
CHRISTOPHER A. BUTTA
GREGORY W. ARMES
February 11, 1994
Cabot Oil & Gas Corporation
15375 Memorial Drive
Houston, Texas 77079
Re: Review of Proved Reserves
And Future Net Revenues
As of January 1, 1994
Gentlemen:
At your request, we reviewed the estimates of Proved Reserves of oil
and gas and the Future Net Revenues associated with these reserves that Cabot
Oil & Gas Corporation, hereinafter Cabot, attributes to its net interests in
oil and gas properties as of January 1, 1994. Cabot's estimates, shown below,
are in accordance with the definitions contained in Securities and Exchange
Commission Regulation S-X, Rule 4-10(a).
Proved Reserves
---------------------------------------------
Developed Undeveloped Total
--------- ----------- -----------
Net Oil, MBbls 2,345.7 480.2 2,825.9
Net Gas, MMcf 669,672.0 138,607.7 808,279.7
Future Net Revenues
Undiscounted,M$ 1,305,716.0 214,294.0 1,520,010.0
Discounted at 10 Percent, M$ 581,357.8 59,740.0 641,097.8
Based on our investigations and subject to the limitations described
hereinafter, it is our judgment that (1) Cabot has an effective system for
gathering data and documenting information required to estimate its Proved
Reserves and to project its Future Net Revenues, (2) in making its estimates
and projections, Cabot used appropriate engineering, geologic, and evaluation
principles and techniques that are in accordance with practices generally
accepted in the petroleum industry, and (3) the results of those estimates and
projections are, in the aggregate, reasonable.
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MILLER AND LENTS, LTD.
Cabot Oil & Gas Corporation February 11, 1994
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All of the reserves discussed herein are located within the
continental United States. Gas volumes were estimated at the appropriate
pressure base and temperature base that are established for each well or field
by the applicable sales contract or regulatory body. Total gas reserves were
obtained by summing the reserves for all the individual properties and are
therefore stated herein at a mixed pressure base.
In accordance with Securities and Exchange Commission guidelines,
Future Net Revenues were computed based on prices being received for oil and
gas as of Cabot's fiscal year end, December 31, 1993. The Present Value of
Future Net Revenues was computed by discounting the Future Net Revenues at ten
percent per annum. Estimates of Future Net Revenues and the Present Value of
Future Net Revenues are not intended and should not be interpreted to represent
fair market values for the estimated reserves.
In conducting our investigations, we reviewed the pertinent available
engineering, geological and accounting information for each well or designated
property to satisfy ourselves that Cabot's estimates of reserves and future
production forecasts and economic projections are, in the aggregate,
reasonable. We independently selected a sampling of properties in each region
and reviewed the direct operating expenses and product prices used in the
economic projections.
In its estimates of Proved Reserves and Future Net Revenues associated
with its Proved Reserves, Cabot has considered that a portion of its facilities
associated with the movement of its gas in the Appalachian Region to its
markets are unusual in that the construction and operation of these facilities
are highly dependent on its producing operations. Cabot has deemed the portion
of the cost of these facilities associated with its revenue interest gas are
costs that are attributable to its oil and gas producing activities, and
accordingly, has included these costs in its computation of the Future Net
Revenues associated with its Proved Reserves.
Reserve estimates were based on decline curve extrapolations, material
balance calculations, volumetric calculations, analogies, or combinations of
these methods for each well, reservoir, or field. Reserve estimates from
volumetric calculations and from analogies are often less certain than reserve
estimates based on well performance obtained over a period during which a
substantial portion of the reserves were produced.
In making its projections, Cabot estimated yearly well abandonment
costs except where salvage values were assumed to offset these expenses. Costs
for possible future environmental claims were not included. Cabot's estimates
include no adjustments for production prepayments, exchange agreements, gas
balancing, or similar arrangements. We were provided with no information
concerning these conditions and we have made no investigations of these matters
as such was beyond the scope of this investigation.
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MILLER AND LENTS, LTD.
Cabot Oil & Gas Corporation February 11, 1994
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The evaluations presented in this report, with the exceptions of those
parameters specified by others, reflect our informed judgments based on
accepted standards of professional investigation but are subject to those
generally recognized uncertainties associated with interpretation of
geological, geophysical, and engineering information. Government policies and
market conditions different from those employed in this study may cause the
total quantity of oil or gas to be recovered, actual production rates, prices
received, or operating and capital costs to vary from those presented in this
report.
In conducting these evaluations, we relied upon production histories,
accounting and cost data, and other financial, operating, engineering, and
geological data supplied by Cabot. To a lesser extent, non-proprietary data
existing in the files of Miller and Lents, Ltd., and data obtained from
commercial services were used. We also relied, without independent
verification, upon Cabot's representation of its ownership interests, the
current prices, and the transportation fees applicable to each property.
Miller and Lents, Ltd. is an independent oil and gas consulting firm.
None of the principals of this firm have any financial interests in Cabot or
any of its affiliated companies. Our fee is not contingent upon the results of
our work or report, and we have not performed other services for Cabot that
would affect our objectivity.
Yours very truly,
MILLER AND LENTS, LTD.
By /s/ WALTER CROW
Walter Crow
President
WC/cw