GuruFocus Premium Membership

Serving Intelligent Investors since 2004. Only 96 cents a day.

Free Trial

Free 7-day Trial
All Articles and Columns »

Bill Barrett Corp. Reports Operating Results (10-Q)

August 03, 2010 | About:
10qk

10qk

18 followers
Bill Barrett Corp. (BBG) filed Quarterly Report for the period ended 2010-06-30.

Bill Barrett Corp. has a market cap of $1.65 billion; its shares were traded at around $35.98 with a P/E ratio of 24.1 and P/S ratio of 2.8. Bill Barrett Corp. had an annual average earning growth of 35.9% over the past 5 years.BBG is in the portfolios of Chuck Royce of Royce& Associates, Paul Tudor Jones of The Tudor Group, Bruce Kovner of Caxton Associates.

Highlight of Business Operations:

We were formed in January 2002 and are incorporated in the State of Delaware. We began active natural gas and oil operations in March 2002 upon the acquisition of properties in the Wind River Basin of Wyoming. Also in 2002, we completed two additional acquisitions of properties in the Uinta (Utah), Wind River (Wyoming), Powder River (Wyoming) and Williston (North Dakota, South Dakota and Montana) Basins. In early 2003, we completed an acquisition of largely undeveloped coalbed methane properties located in the Powder River Basin. In September 2004, we acquired properties in and around the Gibson Gulch field in the Piceance Basin of Colorado. In December 2004, we completed our initial public offering of 14,950,000 shares of our common stock at a price to the public of $25.00 per share. We received net proceeds of $347.3 million after deducting underwriting fees and other offering costs. We completed an acquisition in May 2006 of coalbed methane properties located in the Powder River Basin. In June 2007, we completed the sale of our Williston Basin properties. In June 2009, we completed an acquisition of unproved undeveloped acreage in the Cottonwood Gulch area of the Piceance Basin.

Beginning in January 2009 on a prospective basis, we elected to receive NGL values for a portion of our natural gas production in the Piceance Basin. Given the strength of NGL market prices relative to natural gas market prices during the six months ended June 30, 2010, we realized an increase in production revenues of approximately $29.5 million, or $0.63 per Mcfe, as compared to an increase of $7.5 million, or $0.17 per Mcfe, for the six months ended June 30, 2009. In the future there is no assurance that the amount received related to NGL resulting from the processing of natural gas will exceed the cost of processing.

Hedging Activities. During the six months ended June 30, 2010, approximately 75% of our natural gas volumes (excluding basis only swaps, which was equivalent to 15% of our natural gas volumes) and 47% of our oil volumes were subject to financial hedges, which resulted in an increase in natural gas revenues of $56.7 million and an increase in oil revenues of $1.2 million after settlements for all commodity derivatives, including basis only and NGL swaps. During the six months ended June 30, 2009, approximately 78% of our natural gas volumes (excluding basis only swaps, which was equivalent to 2% of our natural gas volumes) and 50% of our oil volumes were subject to financial hedges, which resulted in an increase in natural gas revenues of $157.4 million and an increase in oil revenues of $5.1 million after settlements for all commodity derivatives, including basis only swaps.

The overall increase in commodity derivative gain (loss) to a gain of $2.0 million for the six months ended June 30, 2010 from a loss of $34.9 million for the six months ended June 30, 2009 is due to an increase in unrealized gains primarily resulting from changes in the fair value of our basis only hedges, offset by realized losses primarily related to settlements of our basis only swaps.

Lease Operating Expense. Lease operating expense increased to $0.56 per Mcfe for the six months ended June 30, 2010 from $0.50 per Mcfe for the six months ended June 30, 2009. The following table displays the lease operating expense by basin:

Read the The complete Report

About the author:

10qk
GuruFocus - Stock Picks and Market Insight of Gurus

Rating: 4.0/5 (4 votes)

Comments

Please leave your comment:


Get WordPress Plugins for easy affiliate links on Stock Tickers and Guru Names | Earn affiliate commissions by embedding GuruFocus Charts
GuruFocus Affiliate Program: Earn up to $400 per referral. ( Learn More)
Free 7-day Trial
FEEDBACK