Callon Announces Additional Natural Gas Hedges.Business Editors & Energy Writers NATCHEZ Natchez, city, United States Natchez, city (1990 pop. 19,460), seat of Adams co., SW Miss., on bluffs above the Mississippi River; settled 1716, inc. 1803. , Miss.--(BUSINESS WIRE)--Oct. 1, 2002 Callon Petroleum Company (NYSE NYSE See: New York Stock Exchange :CPE (Customer Premises Equipment) Communications equipment that resides on the customer's premises. CPE - Customer Premises Equipment ) (NYSE:CPE.PrA) today announced it has hedged an additional 2.5 billion cubic feet (Bcf) of its natural gas production during the six-month period from November November: see month. 2002 through April 2003. The hedges were implemented through a combination of derivative derivative: see calculus. derivative In mathematics, a fundamental concept of differential calculus representing the instantaneous rate of change of a function. transactions, in the form of no-cost collars, and commitments for physical deliveries at applicable index prices, with floors and ceilings specified spec·i·fy tr.v. spec·i·fied, spec·i·fy·ing, spec·i·fies 1. To state explicitly or in detail: specified the amount needed. 2. To include in a specification. 3. for the monthly index prices. The new hedges cover 500 million cubic feet (MMcf) per month for November 2002 through February February: see month. 2003, providing for a floor price of $3.75 per thousand cubic feet (Mcf) and an average ceiling price of $5.00 per Mcf. In addition, hedges covering 250 MMcf per month for March and April 2003 provide for a floor price of $3.75 per Mcf and a ceiling price of $4.60 per Mcf. Previous hedging transactions by the company cover 2 Bcf of its natural gas production for the eight-month period March through October October: see month. 2003. These hedges, in the form of no-cost collars, apply to 250 MMcf per month and provide for a floor price of $3.50 per Mcf and an average ceiling price of $4.76 per Mcf. Based upon the company's natural gas production rates for the second quarter of 2002, existing hedges represent 42% of natural gas production for the six-month period November 2002 through April 2003 and 21% of natural gas production for the following six-month period ending October 2003. The company's current natural gas hedges, by calendar quarter, consist of:
Volume Average Average
Quarter Hedged Floor Price Ceiling Price
Ended (MMcf) (Mcf) (Mcf)
12/31/02 1,000 $3.75 $5.05
3/31/03 1,500 $3.71 $4.86
6/30/03 1,000 $3.56 $4.72
9/30/03 750 $3.50 $4.76
12/31/03 250 $3.50 $4.76
Callon Petroleum Company has been engaged in the exploration, development, acquisition and operation of oil and gas properties in the Gulf Coast region since 1950. This news release contains projections and other forward-looking statements forward-looking statement A projected financial statement based on management expectations. A forward-looking statement involves risks with regard to the accuracy of assumptions underlying the projections. , including statements regarding the company's ability to fund its future obligations, within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. These projections and statements reflect the company's current views with respect to future events and financial performance. No assurances can be given, however, that these events will occur or that these projections will be achieved and actual results could differ materially from those projected as a result of certain factors. |
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