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

May 04, 2010 | About:
10qk

10qk

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Bill Barrett Corp. (BBG) filed Quarterly Report for the period ended 2010-03-31.

Bill Barrett Corp. has a market cap of $1.59 billion; its shares were traded at around $34.63 with a P/E ratio of 18.6 and P/S ratio of 2.7. Bill Barrett Corp. had an annual average earning growth of 35.9% over the past 5 years.BBG is in the portfolios of NWQ Managers of NWQ Investment Management Co, Chuck Royce of Royce& Associates, Steven Cohen of SAC Capital Advisors, Jim Simons of Renaissance Technologies LLC.

Highlight of Business Operations:

Bill Barrett Corporation (we, our or us) was formed in January 2002 and is 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 and going forward, we elected to receive natural gas liquids (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 during the three months ended March 31, 2010, we realized an increase in production revenues of approximately $12.8 million, or $0.59 per Mcfe as compared to an increase of $1.1 million, or $0.05 per Mcfe for the three months ended March 31, 2009. There is no assurance that the amount received related to NGL resulting from the processing of natural gas in the future will exceed the cost of processing.

Hedging Activities. During the three months ended March 31, 2010, approximately 77% of our natural gas volumes (excluding basis only swaps) and 47% of our oil volumes were hedged, which resulted in an increase in natural gas revenues of $15.9 million and an increase in oil revenues of $0.3 million after settlements for all commodity derivatives, including basis only and NGL swaps. During the three months ended March 31, 2009, approximately 79% of our natural gas volumes and 49% of our oil volumes were hedged, which resulted in an increase in natural gas revenues of $83.9 million and an increase in oil revenues of $3.2 million after settlements for all commodity derivatives.

The overall decrease in commodity derivative loss to $5.7 million for the three months ended March 31, 2010 from $26.0 million for the three months ended March 31, 2009 is primarily due to a reduction in unrealized losses resulting from the change in fair value of our basis only swaps of a loss of $0.8 million from January 1, 2010 to March 31, 2010 compared to the change in fair value of a loss of $20.1 million from January 1, 2009 to March 31, 2009.

Lease Operating Expense. Lease operating expense increased to $0.57 per Mcfe for the three months ended March 31, 2010 from $0.53 per Mcfe for the three months ended March 31, 2009. The following table displays the lease operating expense by basin:

Gathering, Transportation and Processing Expense. Gathering, transportation and processing expense increased to $0.73 per Mcfe for the three months ended March 31, 2010 from $0.50 per Mcfe for the three months ended March 31, 2009. The following table displays the gathering, transportation and processing expense by basin:

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