National Fuel Gas Company (NYSE: NFG) (“National Fuel” or the “Company”) today announced its updated capital expenditure guidance for fiscal years 2012 and 2013 as well as updated production forecasts for Seneca Resources Corporation (“Seneca”), the Company’s wholly-owned exploration and production subsidiary. The Company is providing an updated production forecast range for the entire 2013 fiscal year of 112 to 126 billion cubic feet equivalent (“Bcfe”), which includes 88 to 98 Bcfe from the Marcellus Shale and 19 to 21 Bcfe from its California crude oil properties. The Company is also revising its production forecast range for the entire 2012 fiscal year to 81 to 90 Bcfe, a decrease from the previous forecast of 85 to 95 Bcfe. This reduction is a result of the Company’s response to a significant decline in natural gas prices, in combination with lower-than-anticipated production from Seneca’s non-operated joint venture in the Marcellus Shale. Currently, Seneca has curtailed natural gas production from the Marcellus Shale of approximately 15 million cubic feet (“MMcf”) per day, which represents volumes that would have been sold at spot market pricing. Such pricing typically has been lower than the value received by Seneca on volumes sold to meet current contracted firm sales agreements with various third parties. Seneca is also delaying certain well completion activities within its Marcellus operations. “National Fuel and its subsidiaries have always focused on maximizing the long term value of assets, and today is no different,” said David F. Smith, Chairman and Chief Executive Officer of National Fuel. “Despite the headwinds we face in the current natural gas price environment, the quality of our assets and the strength of our balance sheet provide us with the flexibility to make decisions that are beneficial to the Company in the long run. By curtailing a modest amount of current natural gas production and delaying some Marcellus completions, we are still able to increase production and achieve growth across many of our businesses while preserving the value of our assets for the future when we anticipate higher natural gas prices.”
For fiscal year 2012, the Company anticipates total capital expenditures in the range of $900 to $1,045 million. The new guidance represents a decrease from the previous forecast of $950 to $1,085 million and is largely a result of the Company’s response to the significant decline in natural gas prices. The Company’s capital expenditures for fiscal 2013 will be in the range of $685 to $860 million.The Company will be participating in the Howard Weil 40 th Annual Energy Conference starting today, March 26, 2012. Supporting materials and additional disclosures will be furnished to the Securities and Exchange Commission and will be available on the Company’s investor website at investor.nationalfuelgas.com. Certain statements contained herein, including forecasted production rates and capital expenditures, and statements that are identified by the use of the words “anticipates,” “estimates,” “expects,” “forecasts,” “intends,” “plans,” “predicts,” “projects,” “believes,” “seeks,” “will,” “may” and similar expressions, 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 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; uncertainty of oil and gas reserve estimates; significant differences between the Company’s projected and actual production levels for natural gas or oil; governmental/regulatory actions, initiatives and proceedings, including those involving environmental/safety requirements, 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 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 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; and the cost and effects of legal and administrative claims against the Company. Each forward-looking statement speaks only as of the date on which it is made. The Company disclaims any obligation to update any forward-looking statements to reflect events or circumstances after the date thereof.
Seneca Resources Corporation, the exploration and production segment of National Fuel Gas Company, explores for, develops, and purchases natural gas and oil reserves in California and Appalachia. Additional information about Seneca and National Fuel Gas Company is available at www.nationalfuelgas.com or through the Company’s investor information service at 1-800-334-2188.