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National Fuel Reports First Quarter Earnings

Corporate and All Other

The Corporate and All Other category includes the following active, wholly owned subsidiaries of the Company: National Fuel Gas Midstream Corporation (“Midstream”), formed to build, own and operate natural gas processing and pipeline gathering facilities in the Appalachian region; and the Northeast division of Seneca Resources Corporation that markets high quality hardwoods from Appalachian land holdings.

The Corporate and All Other category earnings of $1.0 million, for the quarter ended December 31, 2012, increased $0.3 million compared to the prior year’s first quarter. The increase in earnings is mainly due to higher earnings from Midstream’s pipeline gathering and natural gas processing operation. Midstream’s Trout Run gathering system in Lycoming County, Pa., and its Covington gathering system in Tioga County, Pa., have provided the critical gathering infrastructure for transporting Seneca’s Marcellus Shale production to the interstate pipeline system.

EARNINGS GUIDANCE

The Company is updating its earnings guidance for fiscal 2013 to reflect actual first quarter results and an increase in our production range. The revised GAAP earnings range is $2.75 to $3.00 per share. The previous earnings guidance had been a range of $2.65 to $2.95 per share. This revised guidance includes forecast oil and gas production for fiscal 2013 for the Exploration and Production segment in the range between 102 and 112 Bcfe (previous production range was between 95 and 107), hedges currently in place, and NYMEX equivalent pricing of $3.50 per MMBtu for natural gas and $85 per Bbl for crude oil for unhedged production for the remainder of the fiscal year.

EARNINGS TELECONFERENCE

The Company will host a conference call on Friday, February 8, 2013, at 11 a.m. (Eastern Time) to discuss this announcement. There are two ways to access this call. For those with Internet access, visit the investor relations page at National Fuel’s website at investor.nationalfuelgas.com. For those without Internet access, access is also provided by dialing (toll-free) 1-866-700-6067 and using the passcode “69013483.” For those unable to listen to the live conference call, a replay will be available at approximately 2 p.m. (Eastern Time) at the same website link and by phone at (toll-free) 1-888-286-8010 using passcode “47931748.” Both the webcast and telephonic replay will be available until the close of business on Friday, February 15, 2013.

National Fuel is an integrated energy company with $6.1 billion in assets comprised of the following four operating segments: Exploration and Production, Pipeline and Storage, Utility, and Energy Marketing. Additional information about National Fuel is available at www.nationalfuelgas.com or through its investor information service at 1-800-334-2188.

Certain statements contained herein, including statements identified by the use of the words “anticipates,” “estimates,” “expects,” “forecasts,” “intends,” “plans,” “predicts,” “projects,” “believes,” “seeks,” “will,” “may” and similar expressions, and statements which are other than statements of historical facts, are “forward-looking statements” as defined by the Private Securities Litigation Reform Act of 1995. Forward-looking statements involve risks and uncertainties, which could cause actual results or outcomes to differ materially from those expressed in the forward-looking statements. The Company’s expectations, beliefs and projections contained herein are expressed in good faith and are believed to have a reasonable basis, but there can be no assurance that such expectations, beliefs or projections will result or be achieved or accomplished. In addition to other factors, the following are important factors that could cause actual results to differ materially from those discussed in the forward-looking statements: factors affecting the Company’s ability to successfully identify, drill for and produce economically viable natural gas and oil reserves, including among others geology, lease availability, title disputes, weather conditions, shortages, delays or unavailability of equipment and services required in drilling operations, insufficient gathering, processing and transportation capacity, the need to obtain governmental approvals and permits, and compliance with environmental laws and regulations; changes in laws, regulations or judicial interpretations to which the Company is subject, including those involving derivatives, taxes, safety, employment, climate change, other environmental matters, real property, and exploration and production activities such as hydraulic fracturing; changes in the price of natural gas or oil; impairments under the SEC’s full cost ceiling test for natural gas and oil reserves; uncertainty of oil and gas reserve estimates; significant differences between the Company’s projected and actual production levels for natural gas or oil; changes in demographic patterns and weather conditions; changes in the availability, price or accounting treatment of derivative financial instruments; governmental/regulatory actions, initiatives and proceedings, including those involving rate cases (which address, among other things, allowed rates of return, rate design and retained natural gas), environmental/safety requirements, affiliate relationships, industry structure, and franchise renewal; delays or changes in costs or plans with respect to Company projects or related projects of other companies, including difficulties or delays in obtaining necessary governmental approvals, permits or orders or in obtaining the cooperation of interconnecting facility operators; financial and economic conditions, including the availability of credit, and occurrences affecting the Company’s ability to obtain financing on acceptable terms for working capital, capital expenditures and other investments, including any downgrades in the Company’s credit ratings and changes in interest rates and other capital market conditions; changes in economic conditions, including global, national or regional recessions, and their effect on the demand for, and customers’ ability to pay for, the Company’s products and services; the creditworthiness or performance of the Company’s key suppliers, customers and counterparties; economic disruptions or uninsured losses resulting from major accidents, fires, severe weather, natural disasters, terrorist activities, acts of war, cyber attacks or pest infestation; changes in price differential between similar quantities of natural gas at different geographic locations, and the effect of such changes on the demand for pipeline transportation capacity to or from such locations; other changes in price differentials between similar quantities of oil or natural gas having different quality, heating value, geographic location or delivery date; significant differences between the Company’s projected and actual capital expenditures and operating expenses; changes in laws, actuarial assumptions, the interest rate environment and the return on plan/trust assets related to the Company’s pension and other post-retirement benefits, which can affect future funding obligations and costs and plan liabilities; the cost and effects of legal and administrative claims against the Company or activist shareholder campaigns to effect changes at the Company; increasing health care costs and the resulting effect on health insurance premiums and on the obligation to provide other post-retirement benefits; or increasing costs of insurance, changes in coverage and the ability to obtain insurance. The Company disclaims any obligation to update any forward-looking statements to reflect events or circumstances after the date thereof.

                                   
NATIONAL FUEL GAS COMPANY
RECONCILIATION OF CURRENT AND PRIOR YEAR GAAP EARNINGS
QUARTER ENDED DECEMBER 31, 2012
 
Exploration & Pipeline & Energy Corporate /
(Thousands of Dollars) Production       Storage       Utility       Marketing       All Other       Consolidated**
 
First quarter 2012 GAAP earnings $ 30,315 $ 9,959 $ 19,353 $ 429 $ 643 $ 60,699
 
Drivers of operating results
Higher (lower) crude oil prices 2,462 2,462
Higher (lower) natural gas prices (9,026 ) (9,026 )
Higher (lower) natural gas production 19,597 19,597
Higher (lower) crude oil production (276 ) (276 )
Lower (higher) lease operating expenses (4,609 ) (4,609 )
Lower (higher) depreciation / depletion (6,785 ) 1,019 (628 ) (6,394 )
 
Higher (lower) transportation and storage revenues 5,526 5,526
Higher (lower) efficiency gas revenues 380 380
Higher (lower) gathering and processing revenues 1,375 1,375
Lower (higher) operating expenses (2,950 ) 1,314 (1,636 )
 
Colder weather 1,371 1,371
 
Higher AFUDC * 320 320
(Higher) lower interest expense (2,205 ) (2,205 )
 
Lower (higher) income tax expense/effective tax rate 535 535
 
All other / rounding   157           (271 )         305         66         (432 )         (175 )
 
First quarter 2013 GAAP earnings $ 26,680         $ 16,933         $ 22,878       $ 495       $ 958         $ 67,944  
 
 
* AFUDC = Allowance for Funds Used During Construction
** Amounts do not reflect intercompany eliminations
 
                                   
NATIONAL FUEL GAS COMPANY
RECONCILIATION OF CURRENT AND PRIOR YEAR GAAP EARNINGS PER SHARE
QUARTER ENDED DECEMBER 31, 2012
 
Exploration & Pipeline & Energy Corporate /
Production       Storage       Utility       Marketing       All Other       Consolidated**
 
First quarter 2012 GAAP earnings $ 0.36 $ 0.12 $ 0.23 $ 0.01 $ 0.01 $ 0.73
 
Drivers of operating results
Higher (lower) crude oil prices 0.03 0.03
Higher (lower) natural gas prices (0.11 ) (0.11 )
Higher (lower) natural gas production 0.23 0.23
Higher (lower) crude oil production - -
Lower (higher) lease operating expenses (0.05 ) (0.05 )
Lower (higher) depreciation / depletion (0.08 ) 0.01 (0.01 ) (0.08 )
 
Higher (lower) transportation and storage revenues 0.07 0.07
Higher (lower) efficiency gas revenues - -
Higher (lower) gathering and processing revenues 0.02 0.02
Lower (higher) operating expenses (0.04 ) 0.02 (0.02 )
 
Colder weather 0.02 0.02
 
Higher AFUDC * - -
(Higher) lower interest expense (0.03 ) (0.03 )
 
Lower (higher) income tax expense/effective tax rate 0.01 0.01
 
All other / rounding   0.01           -         (0.01 )         -         (0.01 )         (0.01 )
 
First quarter 2013 GAAP earnings $ 0.32         $ 0.20       $ 0.27         $ 0.01       $ 0.01         $ 0.81  
 
 
* AFUDC = Allowance for Funds Used During Construction
** Amounts do not reflect intercompany eliminations
 
           
NATIONAL FUEL GAS COMPANY
AND SUBSIDIARIES
 
(Thousands of Dollars, except per share amounts)
Three Months Ended
December 31,
(Unaudited)

SUMMARY OF OPERATIONS

  2012     2011  
Operating Revenues $ 452,854   $ 432,423  
 
Operating Expenses:
Purchased Gas 121,919 132,193
Operation and Maintenance 107,732 100,059
Property, Franchise and Other Taxes 19,664 19,230
Depreciation, Depletion and Amortization   72,331     62,547  
321,646 314,029
 
Operating Income 131,208 118,394
 
Other Income (Expense):
Interest Income 1,386 1,105
Other Income 1,415 1,336
Interest Expense on Long-Term Debt (21,448 ) (18,641 )
Other Interest Expense   (1,068 )   (770 )
 
Income Before Income Taxes 111,493 101,424
 
Income Tax Expense   43,549     40,725  
 
Net Income Available for Common Stock $ 67,944   $ 60,699  
 
Earnings Per Common Share:
Basic $ 0.81   $ 0.73  
Diluted $ 0.81   $ 0.73  
 
Weighted Average Common Shares:
Used in Basic Calculation   83,390,278     82,870,931  
Used in Diluted Calculation   84,006,050     83,699,981  
 
           
NATIONAL FUEL GAS COMPANY
AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(Unaudited)
 
December 31, September 30,
(Thousands of Dollars)         2012           2012  
 
ASSETS
Property, Plant and Equipment $ 6,791,637 $ 6,615,813
Less - Accumulated Depreciation, Depletion and Amortization   1,935,448           1,876,010  
Net Property, Plant and Equipment   4,856,189         $ 4,739,803  
 
Current Assets:
Cash and Temporary Cash Investments 61,017 74,494
Hedging Collateral Deposits - 364
Receivables - Net 143,567 115,818
Unbilled Utility Revenue 47,134 19,652
Gas Stored Underground 44,485 49,795
Materials and Supplies - at average cost 29,946 28,577
Other Current Assets 49,108 56,121
Deferred Income Taxes   19,112           10,755  
Total Current Assets   394,369           355,576  
 
Other Assets:
Recoverable Future Taxes 152,202 150,941
Unamortized Debt Expense 12,860 13,409
Other Regulatory Assets 551,707 546,851
Deferred Charges 6,781 7,591
Other Investments 90,513 86,774
Goodwill 5,476 5,476
Fair Value of Derivative Financial Instruments 37,135 27,616
Other   965           1,105  
Total Other Assets   857,639           839,763  
Total Assets $ 6,108,197         $ 5,935,142  
 
CAPITALIZATION AND LIABILITIES
Capitalization:
Comprehensive Shareholders' Equity
Common Stock, $1 Par Value Authorized - 200,000,000
Shares; Issued and Outstanding - 83,482,125 Shares
and 83,330,140 Shares, Respectively $ 83,482 $ 83,330
Paid in Capital 673,607 669,501
Earnings Reinvested in the Business   1,343,765           1,306,284  
Total Common Shareholders' Equity Before
Items of Other Comprehensive Loss 2,100,854 2,059,115
Accumulated Other Comprehensive Loss   (84,644 )         (99,020 )
Total Comprehensive Shareholders' Equity 2,016,210 1,960,095
Long-Term Debt, Net of Current Portion   1,149,000           1,149,000  
Total Capitalization   3,165,210           3,109,095  
 
Current and Accrued Liabilities:
Notes Payable to Banks and Commercial Paper 238,000 171,000
Current Portion of Long-Term Debt 250,000 250,000
Accounts Payable 94,909 87,985
Amounts Payable to Customers 15,278 19,964
Dividends Payable - 30,416
Interest Payable on Long-Term Debt 16,320 29,491
Customer Advances 22,068 24,055
Customer Security Deposits 18,926 17,942
Other Accruals and Current Liabilities 103,582 79,099
Fair Value of Derivative Financial Instruments   13,816           24,527  
Total Current and Accrued Liabilities   772,899           734,479  
 
Deferred Credits:
Deferred Income Taxes 1,126,551 1,065,757
Taxes Refundable to Customers 66,396 66,392
Unamortized Investment Tax Credit 1,898 2,005
Cost of Removal Regulatory Liability 147,267 139,611
Other Regulatory Liabilities 22,911 21,014
Pension and Other Post-Retirement Liabilities 514,116 516,197
Asset Retirement Obligations 123,984 119,246
Other Deferred Credits   166,965           161,346  
Total Deferred Credits   2,170,088           2,091,568  
Commitments and Contingencies   -           -  
Total Capitalization and Liabilities $ 6,108,197         $ 5,935,142  
 
           
NATIONAL FUEL GAS COMPANY
AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
Three Months Ended
December 31,
(Thousands of Dollars)         2012           2011  
 
Operating Activities:
Net Income Available for Common Stock $ 67,944 $ 60,699
Adjustments to Reconcile Net Income to Net Cash
Provided by Operating Activities:
Depreciation, Depletion and Amortization 72,331 62,547
Deferred Income Taxes 41,000 39,398
Other 7,923 2,375
Change in:
Hedging Collateral Deposits 364 (5,417 )
Receivables and Unbilled Utility Revenue (55,261 ) (51,054 )
Gas Stored Underground and Materials and Supplies 3,941 (2,226 )
Unrecovered Purchased Gas Costs - (3,002 )
Other Current Assets 7,013 232
Accounts Payable 6,163 (5,065 )
Amounts Payable to Customers (4,686 ) (3,522 )
Customer Advances (1,987 ) 6,171
Customer Security Deposits 984 364
Other Accruals and Current Liabilities (5,667 ) (3,460 )
Other Assets (597 ) (6,244 )
Other Liabilities         6,495           3,867  
Net Cash Provided by Operating Activities       $ 145,960         $ 95,663  
 
Investing Activities:
Capital Expenditures $ (162,981 ) $ (249,105 )
Other         (3,533 )         (966 )
Net Cash Used in Investing Activities       $ (166,514 )       $ (250,071 )
 
Financing Activities:
Changes in Notes Payable to Banks and Commercial Paper $ 67,000 $ (20,000 )
Reduction of Long-Term Debt - (150,000 )
Net Proceeds From Issuance of Long-Term Debt - 496,085
Dividends Paid on Common Stock (60,879 ) (29,398 )
Proceeds From Issuance of Common Stock         956           1,555  
Net Cash Provided By Financing Activities       $ 7,077         $ 298,242  
Net Increase (Decrease) in Cash and Temporary
Cash Investments (13,477 ) 143,834
Cash and Temporary Cash Investments
at Beginning of Period         74,494           80,428  
Cash and Temporary Cash Investments
at December 31       $ 61,017         $ 224,262  
 
                 
NATIONAL FUEL GAS COMPANY
AND SUBSIDIARIES
 
SEGMENT OPERATING RESULTS AND STATISTICS
(UNAUDITED)
 
Three Months Ended
(Thousands of Dollars, except per share amounts) December 31,

EXPLORATION AND PRODUCTION SEGMENT

  2012           2011         Variance
Total Operating Revenues $ 155,450         $ 135,974         $ 19,476  
 
Operating Expenses:
Operation and Maintenance:
General and Administrative Expense 14,433 13,860 573
Lease Operating Expense 25,696 18,605 7,091
All Other Operation and Maintenance Expense 5,498 1,532 3,966
Property, Franchise and Other Taxes 3,257 2,546 711
Depreciation, Depletion and Amortization   51,922           41,484           10,438  
  100,806           78,027           22,779  
 
Operating Income 54,644 57,947 (3,303 )
 
Other Income (Expense):
Interest Income 470 347 123
Other Interest Expense   (8,696 )         (5,304 )         (3,392 )
 
Income Before Income Taxes 46,418 52,990 (6,572 )
Income Tax Expense   19,738           22,675           (2,937 )
Net Income $ 26,680 $ 30,315 $ (3,635 )
 
Net Income Per Share (Diluted) $ 0.32         $ 0.36         $ (0.04 )
 
 
 
 
Three Months Ended
December 31,

PIPELINE AND STORAGE SEGMENT

  2012           2011         Variance
Revenues from External Customers $ 43,459 $ 35,225 $ 8,234
Intersegment Revenues   22,797           21,064           1,733  
Total Operating Revenues   66,256           56,289           9,967  
 
Operating Expenses:
Purchased Gas 786 1 785
Operation and Maintenance 19,439 19,514 (75 )
Property, Franchise and Other Taxes 5,433 5,408 25
Depreciation, Depletion and Amortization   8,525           10,092           (1,567 )
  34,183           35,015           (832 )
 
Operating Income 32,073 21,274 10,799
 
Other Income (Expense):
Interest Income 64 57 7
Other Income 1,343 1,027 316
Other Interest Expense   (6,177 )         (6,332 )         155  
 
Income Before Income Taxes 27,303 16,026 11,277
Income Tax Expense   10,370           6,067           4,303  
Net Income $ 16,933         $ 9,959         $ 6,974  
 
Net Income Per Share (Diluted) $ 0.20         $ 0.12         $ 0.08  
 
                 
NATIONAL FUEL GAS COMPANY
AND SUBSIDIARIES
 
SEGMENT OPERATING RESULTS AND STATISTICS
(UNAUDITED)
 
Three Months Ended
(Thousands of Dollars, except per share amounts) December 31,

UTILITY SEGMENT

  2012           2011         Variance
Revenues from External Customers $ 208,563 $ 208,810 $ (247 )
Intersegment Revenues   4,311           4,389           (78 )
Total Operating Revenues   212,874           213,199           (325 )
 
Operating Expenses:
Purchased Gas 105,942 108,405 (2,463 )
Operation and Maintenance 43,261 45,333 (2,072 )
Property, Franchise and Other Taxes 10,355 10,547 (192 )
Depreciation, Depletion and Amortization   10,508           10,561           (53 )

 

  170,066           174,846           (4,780 )
 
Operating Income 42,808 38,353 4,455
 
Other Income (Expense):
Interest Income 886 646 240
Other Income 219 242 (23 )

Other Interest Expense

  (8,233 )         (8,160 )         (73 )
 
Income Before Income Taxes 35,680 31,081 4,599
Income Tax Expense   12,802           11,728           1,074  
Net Income $ 22,878         $ 19,353         $ 3,525  
 
Net Income Per Share (Diluted) $ 0.27         $ 0.23         $ 0.04  
 
 
 
 
Three Months Ended
December 31,

ENERGY MARKETING SEGMENT

  2012           2011         Variance
Revenues from External Customers $ 44,166 $ 51,222 $ (7,056 )
Intersegment Revenues   426           287           139  
Total Operating Revenues   44,592           51,509           (6,917 )
 
Operating Expenses:
Purchased Gas 42,156 49,090 (6,934 )
Operation and Maintenance 1,594 1,746 (152 )
Property, Franchise and Other Taxes 58 9 49
Depreciation, Depletion and Amortization   23           24           (1 )
  43,831           50,869           (7,038 )
 
Operating Income 761 640 121
 
Other Income (Expense):
Interest Income 53 35 18
Other Income 12 35 (23 )
Other Interest Expense   (10 )         (4 )         (6 )
 
Income Before Income Taxes 816 706 110
Income Tax Expense   321           277           44  
Net Income $ 495         $ 429         $ 66  
 
Net Income Per Share (Diluted) $ 0.01         $ 0.01         $ -  
 
                 
NATIONAL FUEL GAS COMPANY
AND SUBSIDIARIES
 
SEGMENT OPERATING RESULTS AND STATISTICS
(UNAUDITED)
 
Three Months Ended
(Thousands of Dollars, except per share amounts) December 31,

ALL OTHER

  2012           2011         Variance
Revenues from External Customers $ 1,015 $ 937 $ 78
Intersegment Revenues   5,480           3,362           2,118  
Total Operating Revenues   6,495           4,299           2,196  
 
Operating Expenses:
Operation and Maintenance 1,226 948 278
Property, Franchise and Other Taxes 298 171 127
Depreciation, Depletion and Amortization   1,153           194           959  
  2,677           1,313           1,364  
 
Operating Income 3,818 2,986 832
 
Other Income (Expense):
Interest Income 39 62 (23 )
Other Income (34 ) (77 ) 43
Other Interest Expense   (469 )         (454 )         (15 )
 
Income Before Income Taxes 3,354 2,517 837
Income Tax Expense   1,469           1,113           356  
Net Income $ 1,885         $ 1,404         $ 481  
 
Net Income Per Share (Diluted) $ 0.02         $ 0.02         $ -  
 
               
NATIONAL FUEL GAS COMPANY
AND SUBSIDIARIES
 
SEGMENT OPERATING RESULTS AND STATISTICS
(UNAUDITED)
 
Three Months Ended
(Thousands of Dollars, except per share amounts) December 31,

CORPORATE

  2012         2011         Variance
Revenues from External Customers $ 201 $ 255 $ (54 )
Intersegment Revenues   547         1,028           (481 )
Total Operating Revenues   748         1,283           (535 )
 
Operating Expenses:
Operation and Maintenance 3,181 3,348 (167 )
Property, Franchise and Other Taxes 263 549 (286 )
Depreciation, Depletion and Amortization   200         192           8  
  3,644         4,089           (445 )
 
Operating Loss (2,896 ) (2,806 ) (90 )
 
Other Income (Expense):
Interest Income 23,304 20,306 2,998
Other Income (125 ) 109 (234 )
Interest Expense on Long-Term Debt (21,448 ) (18,641 ) (2,807 )
Other Interest Expense   (913 )       (864 )         (49 )
 
Loss Before Income Taxes (2,078 ) (1,896 ) (182 )
Income Tax Benefit   (1,151 )       (1,135 )         (16 )
Net Loss $ (927 )     $ (761 )       $ (166 )
 
Net Loss Per Share (Diluted) $ (0.01 )     $ (0.01 )       $ -  
 
 
 
Three Months Ended
December 31,

INTERSEGMENT ELIMINATIONS

  2012         2011         Variance
Intersegment Revenues $ (33,561 )     $ (30,130 )       $ (3,431 )
 
Operating Expenses:
Purchased Gas (26,965 ) (25,303 ) (1,662 )
Operation and Maintenance   (6,596 )       (4,827 )         (1,769 )
  (33,561 )       (30,130 )         (3,431 )
 
Operating Income - - -
 
Other Income (Expense):
Interest Income (23,430 ) (20,348 ) (3,082 )
Other Interest Expense   23,430         20,348           3,082  
 
Net Income   -         -           -  
 
Net Income Per Share (Diluted) $ -       $ -         $ -  
 
                                                   
NATIONAL FUEL GAS COMPANY
AND SUBSIDIARIES
 
SEGMENT INFORMATION (Continued)
(Thousands of Dollars)
 
 
Three Months Ended
December 31,
(Unaudited)
 
Increase
  2012   2011 (Decrease)
 

Capital Expenditures:

 

Exploration and Production $ 127,652

(1)

(2)

$ 191,876

(3)

(4)

$ (64,224 )
Pipeline and Storage 25,751

(1)

(2)

44,190

(3)

(4)

(18,439 )
Utility 14,363

(1)

(2)

11,265

(3)

(4)

3,098
Energy Marketing   183   140   43  

Total Reportable

167,949 247,471

 

(79,522 )
All Other 13,665

(1)

(2)

31,404

(3)

(4)

(17,739 )
Corporate   8   76   (68 )
Total Capital Expenditures $ 181,622 $ 278,951 $ (97,329 )
 
 

(1) Capital expenditures for the three months ended December 31, 2012 include accounts payable and accrued liabilities related

to capital expenditures of $73.4 million, $10.5 million, $0.1 million and $2.1 million in the Exploration and Production segment,
Pipeline and Storage segment, Utility segment and the All Other category, respectively. These amounts have been excluded
from the Consolidated Statement of Cash Flows at December 31, 2012 since they represent non-cash investing activities at
that date.
 

(2) Capital expenditures for the three months ended December 31, 2012 exclude capital expenditures of $38.9 million, $12.7

million, $3.2 million and $12.7 million in the Exploration and Production segment, Pipeline and Storage segment, Utility
segment and the All Other category, respectively. These amounts were in accounts payable and accrued liabilities at
September 30, 2012 and paid during the three months ended December 31, 2012. These amounts were excluded from the
Consolidated Statements of Cash Flows at September 30, 2012 since they represented non-cash investing activities at that
date. These amounts have been included in the Consolidated Statement of Cash Flows at December 31, 2012.
 

(3) Capital expenditures for the three months ended December 31, 2011 include accounts payable and accrued liabilities related to

capital expenditures of $123.1 million, $16.6 million, $0.4 million and $14.9 million in the Exploration and Production segment,
Pipeline and Storage segment, Utility segment and the All Other category, respectively. These amounts have been excluded
from the Consolidated Statement of Cash Flows at December 31, 2011 since they represented non-cash investing activities at
that date.
 

(4) Capital expenditures for the three months ended December 31, 2011 exclude capital expenditures of $103.3 million, $16.4

million, $2.3 million and $3.1 million in the Exploration and Production segment, Pipeline and Storage segment, Utility segment
and the All Other category, respectively. These amounts were in accounts payable and accrued liabilities at September 30,
2011 and paid during the three months ended December 31, 2011. These amounts were excluded from the Consolidated
Statements of Cash Flows at September 30, 2011 since they represented non-cash investing activities at that date. These
amounts have been included in the Consolidated Statement of Cash Flows at December 31, 2011.
                     

DEGREE DAYS

Percent Colder
(Warmer) Than:

Three Months Ended December 31

Normal 2012 2011 Normal (1)

Last Year (1)

 
Buffalo, NY 2,253 2,036 1,848 (9.6) 10.2
Erie, PA 2,044 1,898 1,721 (7.1) 10.3
 

(1) Percents compare actual 2012 degree days to normal degree days and actual 2012 degree days to actual 2011 degree days.

 
                 
NATIONAL FUEL GAS COMPANY
AND SUBSIDIARIES
 

EXPLORATION AND PRODUCTION INFORMATION

 
 
Three Months Ended
December 31,
Increase
  2012   2011 (Decrease)
 

Gas Production/Prices:

Production (MMcf)
Appalachia 19,496 13,111 6,385
West Coast   745   817   (72 )
Total Production   20,241   13,928   6,313  
 
Average Prices (Per Mcf)
Appalachia $ 3.35 $ 3.39 $ (0.04 )
West Coast 3.77 4.95 (1.18 )
Weighted Average 3.36 3.48 (0.12 )
Weighted Average after Hedging 4.09 4.78 (0.69 )
 

Oil Production/Prices:

Production (Thousands of Barrels)
Appalachia 6 10 (4 )
West Coast   708   709   (1 )
Total Production   714   719   (5 )
 
Average Prices (Per Barrel)
Appalachia $ 87.83 $ 88.16 $ (0.33 )
West Coast 100.10 109.23 (9.13 )
Weighted Average 100.01 108.93 (8.92 )
Weighted Average after Hedging 96.69 91.38 5.31
 
Total Production (MMcfe)   24,525   18,242   6,283  
 

Selected Operating Performance Statistics:

General & Administrative Expense per Mcfe (1) $ 0.59 $ 0.76 $ (0.17 )
Lease Operating Expense per Mcfe (1) $ 1.05 $ 1.02 $ 0.03
Depreciation, Depletion & Amortization per Mcfe (1) $ 2.12 $ 2.27 $ (0.15 )
 
 
(1) Refer to page 12 for the General and Administrative Expense, Lease Operating Expense
and Depreciation, Depletion, and Amortization Expense for the Exploration and Production
segment.
 
                 
NATIONAL FUEL GAS COMPANY
AND SUBSIDIARIES
 

EXPLORATION AND PRODUCTION INFORMATION

 
 
Hedging Summary for the Remaining Nine Months of Fiscal 2013
 

SWAPS

Volume

Average Hedge Price

Oil 1.3 MMBBL $94.92 / BBL
Gas 43.2 BCF $4.68 / MCF
 
Hedging Summary for Fiscal 2014
 

SWAPS

Volume

Average Hedge Price

Oil 1.2 MMBBL $98.95 / BBL
Gas 49.9 BCF $4.24 / MCF
 
Hedging Summary for Fiscal 2015
 

SWAPS

Volume

Average Hedge Price

Oil 0.4 MMBBL $90.14 / BBL
Gas 22.7 BCF $4.10 / MCF
 
Hedging Summary for Fiscal 2016
 

SWAPS

Volume

Average Hedge Price

Gas 17.9 BCF $4.07 / MCF
 
Hedging Summary for Fiscal 2017
 

SWAPS

 

Volume

Average Hedge Price

Gas 17.9 BCF $4.07 / MCF
 
 

Gross Wells in Process of Drilling

Quarter Ended December 31, 2012

Total

East

West

Company

Wells in Process - Beginning of Period
Exploratory 1.000 1.000 2.000
Developmental 82.000 0.000 82.000
Wells Commenced
Exploratory 0.000 3.000 3.000
Developmental 12.000 27.000 39.000
Wells Completed
Exploratory 0.000 2.000 2.000
Developmental 1.000 26.000 27.000
Wells Plugged & Abandoned
Exploratory 0.000 0.000 0.000
Developmental 0.000 0.000 0.000
Wells in Process - End of Period
Exploratory 1.000 2.000 3.000
Developmental 93.000 1.000 94.000
 
 

Net Wells in Process of Drilling

Quarter Ended December 31, 2012

Total

East

West

Company

Wells in Process - Beginning of Period
Exploratory 1.000 0.125 1.125
Developmental 59.500 0.000 59.500
Wells Commenced
Exploratory 0.000 0.375 0.375
Developmental 12.000 27.000 39.000
Wells Completed
Exploratory 0.000 0.250 0.250
Developmental 1.000 26.000 27.000
Wells Plugged & Abandoned
Exploratory 0.000 0.000 0.000
Developmental 0.000 0.000 0.000
Wells in Process - End of Period
Exploratory 1.000 0.250 1.250
Developmental 70.500 1.000 71.500
 
                   
NATIONAL FUEL GAS COMPANY
AND SUBSIDIARIES
 
 
Pipeline & Storage Throughput - (millions of cubic feet - MMcf)
 
Three Months Ended
December 31,
Increase
2012 2011 (Decrease)
Firm Transportation - Affiliated 28,234 26,177 2,057
Firm Transportation - Non-Affiliated 95,179 57,431 37,748
Interruptible Transportation 1,252 808 444
124,665 84,416 40,249
 
Utility Throughput - (MMcf)
Three Months Ended
December 31,
Increase
2012 2011 (Decrease)
Retail Sales:
Residential Sales 15,153 14,549 604
Commercial Sales 1,967 1,994 (27)
Industrial Sales 301 101 200
17,421 16,644 777
Off-System Sales 2,429 2,745 (316)
Transportation 18,637 16,928 1,709
38,487 36,317 2,170
 
Energy Marketing Volumes
Three Months Ended
December 31,
Increase
2012 2011 (Decrease)
Natural Gas (MMcf) 10,365 10,312 53
 
           
NATIONAL FUEL GAS COMPANY
AND SUBSIDIARIES
FISCAL 2013 EARNINGS GUIDANCE AND SENSITIVITY
 
 
 
 
 
Earnings per share sensitivity to changes
Fiscal 2013 (Diluted earnings per share guidance*) from prices used in guidance* ^
 
$0.50 change per MMBtu gas $5 change per Bbl oil
Earnings Range Increase   Decrease Increase   Decrease
 
Consolidated Earnings $2.75 - $3.00 + $0.11 - $0.11 + $0.02 - $0.02
 
 
 
 
* Please refer to forward looking statement footnote beginning at page 5 of this document.
 
^ This sensitivity table is current as of February 7, 2013 and only considers revenue from the Exploration and Production segment's
crude oil and natural gas sales. This revenue is based upon pricing used in the Company's earnings forecast. For its fiscal 2013
earnings forecast, the Company is utilizing flat NYMEX equivalent commodity pricing, exclusive of basis differential, of $3.50 per MMBtu
for natural gas and $85 per Bbl for crude oil. The sensitivities will become obsolete with the passage of time, changes in Seneca's
production forecast, changes in basis differential, as additional hedging contracts are entered into, and with the settling of hedge
contracts at their maturity.
 
           
NATIONAL FUEL GAS COMPANY
AND SUBSIDIARIES
 
 
 
 

Quarter Ended December 31 (unaudited)

  2012   2011
 
Operating Revenues $ 452,854,000 $ 432,423,000
 
Net Income Available for Common Stock $ 67,944,000 $ 60,699,000
 
Earnings Per Common Share:
Basic $ 0.81 $ 0.73
Diluted $ 0.81 $ 0.73
 
Weighted Average Common Shares:
Used in Basic Calculation   83,390,278   82,870,931
Used in Diluted Calculation   84,006,050   83,699,981
 
 

Twelve Months Ended December 31 (unaudited)

 
Operating Revenues $ 1,647,284,000 $ 1,760,317,000
 
Net Income Available for Common Stock $ 227,322,000 $ 260,557,000
 
Earnings Per Common Share:
Basic: $ 2.73 $ 3.15
Diluted $ 2.71 $ 3.11
 
Weighted Average Common Shares:
Used in Basic Calculation   83,258,386   82,677,232
Used in Diluted Calculation   83,800,341   83,726,544
 




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