fell 3% Tuesday after saying it shut in production on a portion of its unhedged natural gas production, due to low natural gas prices.
The Salt Lake City-based company said that effective Oct. 1, it has shut in about 32 million cubic feet per day of net natural gas production, about 70 million cubic feet per day gross, from its Rocky Mountain producing region. On a net basis the shut-in volume equals about one billion cubic feet equivalent or 2.3 Bcfe gross for the month of October.
Questar, despite the temporary shut-in, has raised the subsidiary's total production guidance for the year 2006. The company now expects to produce 127-129 Bcfe, compared with its earlier guidance of 126-128 Bcfe. Excluding certain accounting adjustments, the revised production outlook represents 10% to 12% growth over 2005 production of 114.2 Bcfe.
Since its July 26 earnings release, the company has also added natural gas hedges for the remaining of 2006 through 2009. The additions include hedges on 1.7 Bcf for the remaining of 2006, 6.9 Bcf for 2007, 7.8 Bcf for 2008 and 20.5 Bcf for 2009. The hedges are based on estimates of the average price per Mcf, net to the well, the company added.
Shares of Questar were down $2.73 to $78.47.
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