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FD&A Costs – Company Interest Reserves (1)

FD&A Costs Excluding Future Development Capital Exploration and development capital expenditures ($ thousands) Exploration and development reserves additions including revisions (mboe) Finding and development cost ($/boe) Three year average F&D cost ($/boe)

$ 268,834 14,892 $ 18.05 $ 15.18

$

Net acquisition capital ($ thousands) Net acquisition reserves additions (mboe) Net acquisition cost ($/boe) Three year average net acquisition cost ($/boe)

$ 598,269 40,702 $ 14.70 $ 12.48

$ $ $

598,269 47,983 12.47 10.24

Total capital expenditures including net acquisitions ($ thousands) Reserves additions including net acquisitions (mboe) Finding development and acquisition cost ($/boe) Three year average FD&A cost ($/boe)

$ 867,103 $ 55,594 $ 15.60 $ 13.30

$ $ $ $

867,103 63,556 13.64 11.00

(1)

RESERVES

Proved Plus Probable 268,834 15,573 17.26 12.76

$ $

AR 2005

Proved

In all cases, the F&D, or FD&A number is calculated by dividing the identified capital expenditures by the applicable reserves additions. Boes may be misleading, particularly if used in isolation. In accordance with NI 51-101, a boe conversion ratio for natural gas of 6 mcf:1 bbl has been used, which is based on an energy equivalency conversion method primarily applicable at the burner tip and does not represent a value equivalency at the wellhead.

FUTURE DEVELOPMENT CAPITAL NI 51-101 requires that FD&A costs be calculated including changes in FDC. Changes in forecast FDC occur annually as a result of development activities, acquisition and disposition activities and capital cost estimates that reflect the independent evaluator’s best estimate of what it will cost to bring the proved undeveloped and probable reserves on production. The current high level of activity has resulted in increased capital costs throughout the industry that are now reflected in the estimates of future development costs effective December 31, 2005. FD&A Costs Including Future Development Capital Proved Plus Probable

Proved Exploration and development capital expenditures ($ thousands) Exploration and development change in FDC ($ thousands) Exploration and development capital including change in FDC ($ thousands) Exploration and development reserves additions including revisions (mboe) Finding and development cost ($/boe) Three year average F&D cost ($/boe)

$ 268,834 $ 41,639 $ 310,473 14,892 $ 20.85 $ 17.64

$ $ $

Net acquisition capital ($ thousands) Net acquisition FDC ($ thousands) Net acquisition capital including FDC ($ thousands) Net acquisition reserves additions (mboe) Net acquisition cost ($/boe) Three year average net acquisition cost ($/boe)

$ 598,269 $ 72,200 $ 670,469 40,702 $ 16.47 $ 14.63

$ $ $ $ $

Total capital expenditures including net acquisitions ($ thousands) Total change in FDC ($ thousands) Total capital including change in FDC ($ thousands) Reserves additions including net acquisitions (mboe) Finding development and acquisition cost including FDC ($/boe) Three year average FD&A cost including FDC ($/boe)

$ 867,103 $ 113,839 $ 980,942 55,594 $ 17.64 $ 15.45

$ 867,103 $ 155,357 $ 1,022,460 63,556 $ 16.09 $ 13.50

$ $

268,834 79,197 348,031 15,573 22.35 16.51 598,269 76,160 674,429 47,983 14.06 12.36

Historic Company Interest Proved FD&A Costs 2005

2004

2003

2002

2001

Annual FD&A excluding FDC $ 15.60 Three year average FD&A excluding FDC $ 13.30

$ 16.53 $ 11.05

$ 10.78 $ 10.69

$ $

Annual FD&A including FDC $ 17.64 Three year average FD&A including FDC $ 15.45

$ 20.46 $ 13.02

$ 12.66 $ 11.96

2000

1999

8.87 9.07

$ 11.35 $ 8.06

$ $

5.73 5.68

$ $

5.86 5.76

$ 10.03 $ 10.16

$ 11.93 $ 9.09

$ $

7.56 7.15

$ $

6.78 6.64

21

2005  

Annual Report

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