Source: Energen Corp.
Energen Corporation (NYSE: EGN) announced today that, over the last several weeks, its oil and gas exploration and production unit, Energen Resources Corporation, has hedged approximately 40.5 billion cubic feet (Bcf) of natural gas in 2012 and 28 Bcf in 2013.
The average NYMEX-equivalent price of the hedges was $5.02 per thousand cubic feet (Mcf) in 2012 and $5.30 per Mcf in 2013. The majority of these hedges (29.5 Bcf in 2012 and 19.2 Bcf in 2013) are San Juan Basin-specific. These are the first natural gas hedge transactions that the company has made for 2012 and 2013. Energen utilizes commodity hedges as a means of helping protect its earnings and cash flows from commodity price volatility.
Energen also has added approximately 7.5 Bcf of natural gas hedges in 2011 at an average NYMEX-equivalent price of $4.75 per Mcf, 3.9 million gallons of natural gas liquids (NGL) hedges in 2011 at an average price of $1.01 per gallon, 3.5 million gallons of NGL hedges in 2012 at an average price of 96 cents per gallon, and 846,000 barrels of oil hedges in 2014 at an average NYMEX price of $89.28 per barrel.