Constellation Energy Partners LLC (NYSE Arca: CEP) today reported fourth quarter and full year 2010 results.
The company produced 3,674 MMcfe during the quarter, for average daily net production of 39.9 MMcfe during the quarter and 41.2 MMcfe for the full year. Operating costs, which include lease operating expenses, production taxes and general and administrative expenses, net of certain non-cash items, averaged $3.68 per Mcfe during the quarter and $3.49 per Mcfe for the full year.
During the quarter, the company completed 13 net wells and recompletions in the Cherokee Basin with total capital spending of $2.1 million. Total capital spending of $8.5 million in 2010 resulted in a total of 31 net wells and recompletions in the Cherokee Basin, and the company had an additional 5 net wells and recompletions in progress at year end. The company announced in December 2010 that it acquired interests in 36 wells (8 net wells at December 31, 2010) in the Central Kansas Uplift for $5.9 million.
The company recorded a net loss of $6.8 million for the fourth quarter 2010. For the full year, the company reported a net loss before charges of $4.4 million, which excludes non-cash asset impairment charges of $272.5 million, $270.4 million of which were recorded in the third quarter. Adjusted EBITDA for the fourth quarter was $11.7 million, which resulted in Adjusted EBITDA of $54.1 million for 2010.
“The fourth quarter rounded out a year of meaningful progress toward our stated goals,” said Stephen R. Brunner, President and Chief Executive Officer of Constellation Energy Partners. “Our operating results were again in line with our forecast, which allowed us to reduce debt by $7.5 million during the quarter for $30 million in total debt reduction in 2010.”
The company had a cash balance of $7.9 million as of December 31, 2010. Outstanding debt under the company’s credit facility currently totals $165 million, leaving the company with $30 million in available borrowing capacity at the company’s current borrowing base of $195 million. The company’s borrowing base is subject to semi-annual review by the lenders, with the next regularly-scheduled review due to occur in the second quarter of 2010.