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LRR Energy, L.P. Announces 2011 Year End Results And 2012 Guidance

LRR Energy, L.P. (NYSE: LRE) (“LRR Energy”) announced today its operating and financial results for the 46-day period from November 16 through December 31, 2011.

Highlights for the 46-day period ended December 31, 2011

  • Initial public offering ("IPO") closed on November 16, 2011; 10,608,000 common units were issued to the public for net proceeds of $188.5 million (including a partial exercise of underwriters' over-allotment option on December 14, 2011)
  • Average daily production of 5,761 Boe per day
  • Estimated proved reserves of 28.8 MMBoe as of December 31, 2011 of which 85% were classified as proved developed; 36% liquids; and standardized measure of $342.3 million
  • Five-year, $500.0 million credit facility with borrowing base of $250.0 million; $155.8 million outstanding as of December 31, 2011

Eric Mullins, Chairman and Co-Chief Executive Officer, commented, "We are very pleased with our successful initial public offering and the ability to offer our unitholders an investment in our long-lived, low-risk oil and natural gas properties that generate stable cash flows. LRR Energy has multiple avenues for growth through our relationships with Lime Rock Resources, Lime Rock Partners and third party oil and natural gas companies.” Charlie Adcock, Co-Chief Executive Officer, reflected that, “Our experienced team has a proven track record of successful acquisitions, skilled exploitation, distributions and capital management. We have a conservative financial strategy and are focused on increasing distributions through reserve and production growth.”

Results for the 46-day period ended December 31, 2011

  • Average daily production was 5,761 Boe per day resulting in revenues from the sale of oil, natural gas and NGLs of $11.2 million
  • Adjusted EBITDA was $10.3 million (see reconciliation of Non-GAAP financial measures on page 10)
  • Total capital expenditures were $0.8 million
  • Distributable Cash Flow was $8.0 million (see reconciliation of Non-GAAP financial measures on page 10)
  • Net income was $12.1 million, or $0.54 per basic and diluted weighted average limited partner unit outstanding
  • Gains on commodity derivative instruments totaled $10.7 million, including $4.0 million of realized gains and $6.7 million of unrealized gains
  • Lease operating expenses totaled $2.4 million, production and ad valorem taxes totaled $0.8 million, and depletion and depreciation totaled $3.9 million
  • General and administrative expense was $1.7 million

Proved Reserves

LRR Energy had 28.8 MMBoe of estimated proved reserves as of December 31, 2011. These estimates were calculated using the unweighted arithmetic average first-day-of-the-month closing price for each month of 2011. The average trailing twelve-month index prices were $96.19/Bbl for NYMEX-WTI and $4.12/MMBtu for NYMEX-Henry Hub natural gas. For NGL pricing, a differential is applied to the $96.19/Bbl average trailing twelve-month index price for oil. The standardized measure of estimated proved reserves was $342.3 million.

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