EXHIBIT 99.1
NEWS RELEASE
Investor Relations Contacts:
Susan Spratlen or Chris Paulsen (972) 444-9001
Pioneer's Oil and Gas Reserves Rise 30%
Dallas, Texas, January 27, 2005 -- Pioneer Natural Resources Company (NYSE:PXD)
today announced that as of December 31, 2004, its total proved oil and gas
reserves were 1.02 billion barrels oil equivalent, or 6.1 trillion cubic feet
(Tcf) natural gas equivalent, including 409 million barrels of crude oil and
natural gas liquids and 3.7 Tcf of natural gas. Proved developed reserves
account for approximately 65% of total proved reserves. The estimated present
value of Pioneer's proved reserves, utilizing a 10% discount rate, was $9.0
billion. The year-end NYMEX equivalent prices utilized to determine proved
reserves were $43.33 per barrel of oil and $6.19 per thousand cubic feet of gas.
Netherland, Sewell and Associates, Inc. (NSA), a top oil and gas reserve
engineering firm, audited the proved reserves of significant fields that
represent approximately 85% of the present value and approximately 88% of the
quantity of Pioneer's proved reserves at year-end 2004. NSA also audited the
proved reserves of Pioneer's significant fields at year- end 2003.
Pioneer added 303 million barrels oil equivalent (MMBOE) of proved reserves
during 2004, replacing 441% of production at a finding and development cost of
$10.48 per barrel oil equivalent (BOE). Pioneer acquired 278 MMBOE of proved
reserves, primarily in the Rockies through its merger with Evergreen Resources,
Inc., and added 39 MMBOE of proved reserves from discoveries and field
extensions in the U.S., Argentina, Tunisia and Canada. During 2004, Pioneer also
produced 69 MMBOE, sold 1 MMBOE and had downward revisions to prior reserve
estimates of 14 MMBOE.
Costs incurred during 2004 totaled $3.2 billion, including $557 million for
development and exploration activities, $2.6 billion for acquisitions and $15
million for asset retirement obligations. Of Pioneer's 2004 development and
exploration cost incurred, 56% was invested in developing proved undeveloped
reserves booked in prior years, and 15% was invested in non-drilling related
categories including seismic and other geologic and geophysical activities.
Year-end proved reserves and costs incurred are detailed in the attached
supplemental schedule.
For the three years ending in 2004, Pioneer's finding and development cost
averaged $8.90 per BOE. Over the three-year period, Pioneer added 519 MMBOE for
total costs incurred of $4.6 billion. Three-year average reserve replacement was
311%. For the five years ending in 2004, Pioneer's finding and development cost
averaged $8.27 per BOE. Over the five-year period, Pioneer added 678 MMBOE for
total costs incurred of $5.6 billion. Five-year average reserve replacement was
269%.
Scott D. Sheffield, Chairman and CEO, stated, "I'm excited about the quality of
the reserves we added to our portfolio in 2004 and the potential represented by
the opportunities we've generated over the past year. We enter 2005 with an
enhanced long-lived asset base in North America, additional opportunities for
development drilling, several new fields with significant unrecorded reserve
potential awaiting final commercialization decisions and an even stronger
foundation for our exploration program. In past years, we've invested heavily in
building a broad portfolio of exploration opportunities in each of our focus
areas, including the Gulf of Mexico, Alaska, North Africa and West Africa. In
2005, we should begin to realize the benefit of these investments as we step up
the level of drilling and test the potential of our more mature prospect
inventory."
Pioneer is a large independent oil and gas exploration and production company
with operations in the United States, Argentina, Canada, Equatorial Guinea,
South Africa and Tunisia. Pioneer's headquarters are in Dallas. For more
information, visit Pioneer's website at www.pioneernrc.com.
Except for historical information contained herein, the statements in this News
Release are forward-looking statements that are made pursuant to the Safe Harbor
Provisions of the Private Securities Litigation Reform Act of 1995. Forward-
looking statements and the business prospects of Pioneer are subject to a number
of risks and uncertainties that may cause Pioneer's actual results in future
periods to differ materially from the forward-looking statements. These risks
and uncertainties include, among other things, volatility of oil and gas prices,
product supply and demand, competition, government regulation or action,
international operations and associated international political and economic
instability, litigation, the costs and results of drilling and operations,
Pioneer's ability to replace reserves, implement its business plans, or complete
its development projects as scheduled, access to and cost of capital,
uncertainties about estimates of reserves, quality of technical data,
environmental and weather risks, acts of war or terrorism. These and other risks
are described in Pioneer's 10-K and 10-Q Reports and other filings with the
Securities and Exchange Commission.