NFR Energy LLC Announces Redetermination of Borrowing Base and Provides Hedging Update

HOUSTON, April 25, 2012 /PRNewswire/ -- NFR Energy LLC ("NFR" or the "Company") today announced that the lenders under its revolving credit agreement completed their semi-annual redetermination of the borrowing base, resulting in a decrease to the borrowing base from $625 million to $600 million. David Sambrooks, CEO of NFR commented, "The outcome of our redetermination was a very positive result for the Company.  NFR realized a roughly 4% decrease in the borrowing base despite an over 30% decline in the bank groups price deck from the prior redetermination last fall. Our significant hedge position as well as the significant impact from the Cotton Valley acquisitions we closed on during the second half of 2011, were both key elements to this outcome."

As of April 25, 2012, the balance outstanding under the revolving credit facility was $440 million.  The next redetermination of the borrowing base is scheduled for October 1, 2012.

Additionally, NFR's current hedge position, as detailed further below, protects for the remainder of 2012 approximately 87.5 Mmbtu/day at $6.15/Mmbtu and protects 88.3 Mmbtu/day of the Company's natural gas production for 2013 at $5.23/Mmbtu.





Weighted Average prices ($Mmbtu)/($/bbl)

















Swap or








Total Volume

Type


Remaining Term


Sub-Floor


Floor


Cap


Mmbtu/d


BOPD


Remaining
















2012






























Swap


9 Months (Apr-Dec)


-


$   6.19


-


70,559


-


19,403,725

Costless Collar


9 Months (Apr-Dec)


-


$   6.00


$   8.65


16,928


-


4,655,200

Three-Way Collar


9 Months (Apr-Dec)


$ 70.00


$ 85.00


$110.00


-


350


96,250
















Total 2012 Hedges










87,487


350

































2013






























Swap


12 Months (Jan-Dec)


-


$   5.23


-


88,325


-


32,238,731

Call Option 


12 Months (Jan-Dec)


-


-


$110.00


-


350


127,750
















Total 2013 Hedges










88,325


350

































2014






























Call Option 


12 Months (Jan-Dec)


-


-


$110.00


-


350


127,750

Call Option 


12 Months (Jan-Dec)


-


-


$    5.25


60,000


-


21,900,000
















Total 2014 Hedges










60,000


350

































2015






























Call Option 


12 Months (Jan-Dec)


-


-


$110.00


-


350


127,750

Call Option 


12 Months (Jan-Dec)


-


-


$    5.25


60,000


-


21,900,000
















Total 2015 Hedges










60,000


350


















 

Forward Looking Statements

This press release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. All statements, other than statements of historical facts, included in this press release that address activities, events or developments that the Company expects, believes or anticipates will or may occur in the future are forward-looking statements. Without limiting the generality of the foregoing, forward-looking statements contained in this press release specifically include the expectations of plans, strategies, objectives and anticipated financial and operating results of the Company, including the Company's drilling program, production, derivatives activities, capital expenditure levels and other guidance included in this press release. These statements are based on certain assumptions made by the Company based on management's experience and perception of historical trends, current conditions, anticipated future developments and other factors believed to be appropriate. Such statements are subject to a number of assumptions, risks and uncertainties, many of which are beyond the control of the Company, which may cause actual results to differ materially from those implied or expressed by the forward-looking statements. These include changes in oil and natural gas prices, the timing of planned capital expenditures, availability of acquisitions, uncertainties in estimating proved reserves and forecasting production results, operational factors affecting the commencement or maintenance of producing wells, the condition of the capital markets generally, as well as the Company's ability to access them, the proximity to and capacity of transportation facilities, and uncertainties regarding environmental regulations or litigation and other legal or regulatory developments affecting the Company's business and other important factors that could cause actual results to differ materially from those projected as described in the Company's annual report and subsequent quarterly reports posted under the Investor Relations tab on the Company's website.

Any forward-looking statement speaks only as of the date on which such statement is made and the Company undertakes no obligation to correct or update any forward-looking statement, whether as a result of new information, future events or otherwise, except as required by applicable law.

About NFR Energy LLC

NFR is an independent exploration and production company focused on the acquisition and development of oil and natural gas resources, primarily operating in East Texas and targeting the Cotton Valley Sand and Haynesville Shale formations. For more information, please visit the Company's website at www.nfrenergy.com.

SOURCE NFR Energy LLC



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http://www.nfrenergy.com/

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