Production volumes during the fourth quarter of 2014 were 20.2 Bcfe, an increase of 0.8 Bcfe or 4% compared to production of 19.4 Bcfe during the fourth quarter of 2013. The increase in production is primarily due to the Forest Oil business combination and the Company’s development program.
Revenues from production of oil, natural gas liquids and natural gas decreased from $109.3 million in the fourth quarter of 2013 to $107.0 million for the fourth quarter of 2014, a decrease of 2%. This decrease of $2.4 million was a result of a decrease in average prices per Mcfe of 6% (before the effects of economic hedges), partially offset by an increase in production of 4%.
The Company’s realized average price for natural gas including hedges was $4.28 per Mcf in the fourth quarter of 2014, or $0.17 per Mcf higher than the Company’s unhedged realized average price of $4.11 per Mcf. The Company’s realized average price of oil including hedges was $69.10 per Bbl in the fourth quarter of 2014, or $6.56 per Bbl higher than the Company’s unhedged realized average price of $62.54 per Bbl. For fourth quarter of 2014, our hedged volumes were approximately 83% of natural gas volumes and 96% of oil volumes, which resulted in a realized gain on such derivative instruments of $6.6 million. For fourth quarter of 2013, our hedged volumes were approximately 69% and 79% of our natural gas and oil volumes, respectively, which resulted in a realized gain on such derivative instruments of $12.2 million. .... Results of the Year ended December 31, 2014
Production volumes during the year ended December 31, 2014 were 75.0 Bcfe, an increase of 11.2 Bcfe or 18% compared to production of 63.8 Bcfe during the year ended December 31, 2013. The increase in production is primarily due to the Forest Oil business combination and the Company’s development program.
Revenues from production of oil, natural gas liquids and natural gas increased from $354.2 million in 2013 to $462.4 million in 2014, an increase of 31%. This increase of $108.1 million was a result of an increase in average prices per Mcfe of 11% (before the effects of economic hedges), coupled with an increase in production of 18%.
The Company’s realized average price for natural gas including hedges was $4.30 per Mcf in 2014 or $0.14 per Mcf lower than the Company’s unhedged realized average price of $4.44 per Mcf. The Company’s realized average price of oil including hedges was $81.79 per Bbl in 2014 or $1.78 per Bbl lower than the Company’s unhedged realized average price of $83.57 per Bbl. In 2014, our hedged volumes were approximately 82% of natural gas volumes and 81% of oil volumes, which resulted in a realized loss on such derivative instruments of $10.8 million. In 2013, our hedged volumes were approximately 80% and 71% of our natural gas and oil volumes, respectively, which resulted in a realized gain on such derivative instruments of $46.2 million. .... Hedging
As of March 31, 2015, the Company has NYMEX hedges in place for the remaining calendar year of 2015 on approximately 218,000 MMbtu/d of its projected natural gas production, at a weighted average price of $4.15/ MMBtu, and 6,967 Bbl/day of oil production at a weighted average price of $89.85/bbl. For the calendar year of 2016, the Company has hedge contracts in place for 67,000 MMbtu/d of its projected natural gas production at a weighted average price of $3.26/MMbtu, and 2,750 Bbl/day of oil production at a weighted average price of $62.31/Bbl. For the calendar year of 2017, the Company has hedge contracts in place for 1,500 Bbl/day of oil production at a weighted average price of $64.80/Bbl.
Year-End Reserves
Year-end 2014 proved reserves, as determined by the Company’s independent reserve engineers and calculated pursuant to SEC guidelines, increased by 62% from approximately 839 Bcfe to 1,357 Bcfe. The changes in proved reserves from 2013 include the purchase of approximately 382 Bcfe of reserves associated primarily with the Forest Oil Corporation business combination and two other acquisitions. Additionally, the downward revision of approximately 98 Bcfe was primarily a result of the reclassification of certain proved undeveloped oil reserves in the Eagle Ford to probable undeveloped reserves as a result of the Company reducing its development program and rig count due to a decline in oil and natural gas prices in late 2014. In addition to pricing, 2014 downward revisions were also attributable to a combination of adjustments in working interest and performance revisions. In 2014, the Company also had 308.1 Bcfe of extensions and discoveries, which were primarily due to refocusing the Company’s development program on primarily gas assets in East Texas.
Proved reserves consisted of 989.8 Bcf of natural gas, 20.1 Mbbls of oil and 41.1 Mbbls of natural gas liquids.
Average prices before effects of economic hedges (2):
Oil (per Bbl)
$
62.54
$
90.25
$
83.57
$
94.41
NGL (per Bbl)
$
21.90
$
33.10
$
29.44
$
32.44
Natural gas (per Mcf)
$
4.11
$
3.62
$
4.44
$
3.66
Combined (per Mcfe)(1)
$
5.30
$
5.63
$
6.17
$
5.55
Average realized prices after effects of economic hedges (2):
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