Top 200 North American Exploration and Production (E&P) Companies –

Operational and Financial Review 2010

GlobalData’s report “Top 200 North American Exploration and Production (E&P)
Companies - Operational and Financial Review 2010” provides analysis on the financial
and Operational parameters of top 200 North American Exploration and Production
(E&P) Companies. Top 200 North American exploration and production companies issue
report is a compilation and analysis of operational and financial parameters as reported
by companies. The report analyses the performance of companies based on indicators
such as reserves & production, capital expenditure, costs, acreage, performance
metrics, and results of oil & gas operations.

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http://www.globaldata.com/reportstore/Report.aspx?ID=Top-200-North-American-
Exploration-and-Production-EP-Companies-Operational-and-Financial-Review-
2010&ReportType=Industry_Report&coreindustry=ALL&Title=Oil_~_Gas

Crude Oil Price Witnessed a Rebound in the Second Half of 2009, but the Gas Price
Weakness Continued
Extreme commodity price volatility is a major concern for the E&P companies. Prices
rose from around $80 per barrel in October 2007 to $147 per barrel in July 2008 and
then fell to less than $40 per barrel by the end of 2008. 2009 saw a steady crude oil
price recovery due to signs of global economic recovery and concerted efforts by OPEC
in cutting crude oil production output. However, increasing natural gas production, in
part driven by the emergence of unconventional gas plays, together with weak demand
has ensured that natural gas prices have continued to remain depressed. The average
2009 Henry Hub natural gas price was $3.9/Mcf, or 30% below the December 2008
price, and the average 2009 WTI oil price was $79.4 per barrel, up nearly 39% over
December 2008.

Oil and Gas Capital Expenditure Fell in 2009, However, Expected To Rise in 2010
Production of top 200 North American Oil and Gas Companies
In the beginning of 2009, majority of the biggest E&P companies’ started cutting back on
their capex plans for 2009 they had announced earlier, and they realigned their capital
budgets in line with their internal cash flows. However, GlobalData expects capital
expenditure to rise in 2010, driven by the announced 2010 budget by E&P companies,
increasing crude oil price prices and the strong balance sheets of companies. Total cost
incurred on upstream operations by the leading 200 North American companies
decreased by 31% from $221.9 billion in 2008 to $153.4 billion in 2009. Total acquisition
cost decreased by 33% from $59.7 billion in 2008 to $40.1 billion in 2009.
Gas Focused Assets and Corporate Deals Multiples Have Declined with the Drop
in Natural Gas Prices
The average deal multiples collapsed rapidly after third quarter of 2008. The US E&P
sector is heavily weighted towards natural gas production as natural gas contributed to
around two-thirds of the total oil and gas production. The average price paid by
companies to acquire a thousand cubic feet equivalent of oil and gas reserve ($/Mcfe)
reduced by half by the second quarter of 2009. This has started to recover but is still
quite low as compared to the peak levels of Q3, 2008. The deal multiples average to
date in 2010 is around $2.33 per Mcfe ($1.90 per Mcfe, if we remove PetroBakken
Energy’s deal to acquire Berens Energy.), lower than the average of $2.7 per Mcfe in
2007-2009.

Total Oil and Gas Reserves Reached 100 billion barrels of Oil Equivalent in 2009
The crude oil and natural gas reserves of top 200 oil and gas North American companies
increased 4.1% in 2009, rising from 96.7 Bboe in 2008 to 100.6 Bboe in 2009. Negative
revisions as a result of lower gas prices more than offset the upward revisions due to
higher crude oil prices and any potential positive performance revisions from improved
drilling techniques. The estimation of proved reserves is highly sensitive to price, so a
one-day price and a 12-month average are likely to result in two different totals. In
2009, for example, the year-end oil price was around $79 a barrel compared to average
of $62 a barrel. However in 2008, the year-end oil price was around $45 a barrel –
roughly half the average for the whole year.

For further details, please click or add the below link to your browser:
http://www.globaldata.com/reportstore/Report.aspx?ID=Top-200-North-American-
Exploration-and-Production-EP-Companies-Operational-and-Financial-Review-
2010&ReportType=Industry_Report&coreindustry=ALL&Title=Oil_~_Gas

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Contact Information:
Rajesh Gunnam
rgunnam@globaldata.com
+914066166782